35. With respect to the marketing and selling of annuities to seniors, which of the following statements is true? (Search Chapter 6)

• a. Producers have the duty to be alert to prospects and clients who may lack the ability to make informed decisions due to diminished capacity.
• b. Annuities are never suitable products for seniors.
• c. Producers must obtain a power of attorney before they can sell a product to anyone older than 70.

d. Producers cannot subject a senior prospect or client to a suitability assessment that is more detailed or rigorous than what would apply to any prospect or client.

34. Abe is a new annuity producer. According to the NAIC annuity suitability model regulation, his recommendation is suitable if what has occurred at the time of the recommendation and sale? (Search Chapter 6)

• a. The buyer is convinced to purchase the product.
• b. The buyer has raised no objections.
• c. The buyer's insurance needs and financial objectives are appropriately addressed.
• d. The buyer has completed the suitability data form.

32. For nonqualified annuities purchased today, at what point does the annuitized income stream generated from such contracts become fully taxable? (Search Chapter 5)

• a. when the full amount of principal has been distributed
• b. when the full amount of investment earnings has been distributed
• c. when the annuitant reaches age 70
• d. never

33. With respect to definition of "recommendation" under the NAIC Suitability in Annuity Transactions model regulation, all of the following statements are true EXCEPT: (Search Chapter 6)

• a. Just about anything a producer might say in meeting with a customer that results in the purchase of an annuity of any type constitutes a "recommendation."
• b. The producer's recommendation must first be approved by the insurer's underwriting department before it can be presented to a client for consideration.
• c. The rules regarding annuity recommendations apply to both producers and to insurance companies that deal directly with consumers.
• d. The rules regarding annuity recommendations apply equally to the sale of new annuities and the replacement of existing ones.

23. What covers the cost of a variable annuity's death benefit? (Search Chapter 3)

• a. the contract administrative service charge
• b. the contingent deferred sales charge
• c. the contract maintenance charge
• d. the mortality and expense charge