1.Which statement about a life insurance policy's accidental death benefit is true?

	a.	Another name for the benefit is the additional purchase option.
	b.	It's a standard policy provision, not a rider.
	c.	In general, if death results from an accident, death must occur within 90 days of the accident event for the beneficiary to receive the accidental death benefit.
	d.	Most financial planners recommend insureds include this feature when purchasing policies.
	e.	All of the above are true.

2.A worker bought a permanent life insurance policy 50 months ago, paying a monthly premium of $100. Then he lost his job, needed all the money he could find, lapsed his policy, and received $8,000 of cash from the insurance company. For federal income tax purposes, is any part of the $8,000 taxable income?

	a.	No
	b.	Yes, all $8,000
	c.	Yes, $5,000
	d.	Yes, $3,000
	e.	Yes, $2,000

3.Which statement about life insurance policy lapses or reinstatements is always true?

	a.	Most lapsed policies are reinstated eventually.
	b.	A policyowner cannot reinstate a lapsed policy unless the reinstatement rider was purchased when the policy was issued.
	c.	Insureds do not have to prove they are still insurable when reinstating a policy.
	d.	The majority of reinstatements occur within the first 2 months of a lapse.
	e.	To reinstate, a policyowner must repay the missed premium payments without interest.

4.

The financial health of about 60% of life insurance companies is rated at least ______ by A.M. Best.

	a.	A++
	b.	A+
	c.	A
	d.	A-
	e.	B-

5.In life insurance, what are trailing commissions?

	a.	Commissions on life insurance policies after the first year.
	b.	Commissions on only term life insurance policies.
	c.	Commissions on only permanent life insurance policies.
	d.	Commissions on life insurance policies after an insured reaches projected life expectancy.
	e.	Commissions on life insurance policies following any policy change increasing the death benefit.

6.Some form of permanent life insurance, but virtually never term insurance, is most appropriate for which situation?

	a.	Providing estate liquidity
	b.	To fund business buy/sell agreements
	c.	To protect the financial security of young children whose parents are in their early 20s.
	d.	To pay off mortgage loan principal if the borrow dies still owing money to the lender.
	e.	Both a and b.

7.

About what percent of non-elderly U.S. citizens get their healthcare coverage through their employers? Choose the closest number.

	a.	6%
	b.	12%
	c.	33%
	d.	50%
	e.	94%

8.Which type of business buy/sell plan funded with life insurance works best when there are ten owners?

	a.	Cross purchase
	b.	Entity purchase
	c.	Hybrid purchase
	d.	Private purchase
	e.	Minority purchase