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Side A ------ Side B
An insurance salesperson who offers a $100 gourmet dinner in exchange for the purchase of a life insurance policy would be considered to have violated ethical sales practices byA. twistingB. replacementC. churningD. rebating ------ d
In what phase of the selling process are serious problems of misrepresentation likely to occur?A. ApproachB. Presentation of RecommendationsC. Fact finding and needs an needs analysisD. Policy delivery and ongoing serviceC.  ------ b
Which of the following phrases should agents avoid using when explaining policies to prospective applicants or clients?A. Cash valueB. Vanishing premiumC. Flexible premiumD. Death benefit ------ b
All of the following are involved in a product presentation exceptA. pressureB. educationC. discussionD disclosure ------ a
Which of the following is NOT part of the home office underwriting process?A. Credit reportB. Medical Information Bureau reportC. Applicant's analysis reportD. Inspection report ------ c
The basis for many state statutes regulating insurance advertising is the NAICsA. McCarran-Ferguson ActB. Fair Credit Reporting ActC. Ethics in Advertising ActD. Unfair Trade Practices Act ------ d
Ethics is best described asA. laws and statutes enacted by duly elected representativesB. religious rituals and ceremoniesC. instructions on how to interact with fellow members of a group or communityD. a society's laws and regulations ------ c
Which of the following is the goal of a sales presentation?A. To educate the client so the client can make her own decisions about what's right for herB. To sell the client as many products as possibleC. To convince the client that the producer's recommendations are bestD. To explain the rules and regulations governing particular insurance products ------ a
Which of the following is not part of a sales presentation?A. Review and re-establish the client-producer relationshipB. Introduce the recommended policyC. Review the product applicationD. Review the client's needs and priorities ------ c
Which of the following should a producer not do during a presentation?A. Explain and educateB.Sell a policyC. Motivate the clientD. Openly discuss a policy's limitations ------ b
All of the following are reasons why it is seldom in the best interest of a policyholder to replace a life insurance policy with a new one exceptA. most of the first-year premium is swallowed up in commissionB. replacement policies are never in the best interest of the policyownerC. the premium is higher because the insured is olderD. waiting periods begin anew ------ b
Diverting insurance funds for personal use is an example ofA. replacementB. rebatingC. misuse of premiumsD. misrepresentation ------ c
Selling variable universal life insurance policies as mutual funds is an example of a prohibited practice calledA. twistingB. misrepresentationC. replacementD. rebating ------ b
When an agent spreads a false story that damages a competing agent's reputation, the offense is calledA. twistingB. defamationC. disclosureD. rebating ------ b
When values of an insurance policy are used to purchase another policy with the same insurer for the sole purpose of earning additional premiums or commissions, the practice is calledA. replacementB. misallianceC. rebatingD. churning ------ d
Which of the following is an objective of the NAIC?A. To promote federal legislation of the insurance industryB. To encourage uniformity in state insurance laws and regulationsC. To develop continuing education courses for insurance producersD. To develop model insurance policies for adoption by insurers ------ b
Which of the following is not a provision of NAIC's Life Insurance Illustrations Model Regulation?A. Each policy illustration must be accompanied by a written explanation or policy summary.B. Each policy illustration should use the words vanish and vanishing premium sparingly.C. Each policy illustration must show that cash values and coverage vary depending on changes in an insurer's costs and dividends,.D. Each policy illustration must be complete. ------ b
Which of the following is not part of a product presentation?A. Explaining policies B. Asking for referralsC. Motivating the clientD. Discussing a policy's limitations ------ b
The use of preprinted material in a sales presentation is recommended for which of the following reasons?A. The agent doesn't have to know exactly how a product works.B. It saves a lot of time and explanations.C. Such material generally has been reviewed for compliance.D. The agent can give it to the client instead of the answering the client's questions. ------ c
The purpose behind full disclosure requirements is toA. make sure a client is told everything there is to know about a productB. help a client make an informed decisionC. make sure agents comply with the letter of the lawD. help a client distinguish one insurer's product from a similar offering from another insurer ------ b
Jim gives Bill a couple of tickets to a baseball game to thank him for purchasing a policy. This is an example ofA. rebating B. twistingC. replacement D. churning ------ a
Which of the following is an example of churning?A. illegally inducing a person  to drop existing insurance to purchase similar coverage with another agent or companyB. Rephrasing a policy provision in such a way that it says just the opposite of the originalC. Replacing a policy with the intent of earning additional premiums or commissionsD. Representing an insurance policy as a retirement plan ------ c
Melanie is a newly licensed producer. A customer calls and asks for some product recommendations, but Melanie thinks that she is not yet qualified to help the customer. Therefore, Melanie has an ethical responsibility toA. answer the customer's questions on the basis of her current knowledge and then send a letter confirming their conversationB. assure the customer that because she is licensed, there is a presumption that the advice Melanie gives is reliableC. refuse to speak to the customerD. seek help from a more experienced colleague or other professional before responding to the customer's questions ------ d
Solicitation of insurance includes\A. inviting prospective purchasers to enter a contract for an insurance productB. making general or specific recommendations concerning insurance productsC. comparing insurance products, advising on insurance matters, or interpreting policies or coveragesD. all of the above ------ d

Side A ------ Side B
An insurance salesperson who offers a $100 gourmet dinner in exchange for the purchase of a life insurance policy would be considered to have violated ethical sales practices byA. twistingB. replacementC. churningD. rebating ------ d
In what phase of the selling process are serious problems of misrepresentation likely to occur?A. ApproachB. Presentation of RecommendationsC. Fact finding and needs an needs analysisD. Policy delivery and ongoing serviceC.  ------ b
Which of the following phrases should agents avoid using when explaining policies to prospective applicants or clients?A. Cash valueB. Vanishing premiumC. Flexible premiumD. Death benefit ------ b
All of the following are involved in a product presentation exceptA. pressureB. educationC. discussionD disclosure ------ a
Which of the following is NOT part of the home office underwriting process?A. Credit reportB. Medical Information Bureau reportC. Applicant's analysis reportD. Inspection report ------ c
The basis for many state statutes regulating insurance advertising is the NAICsA. McCarran-Ferguson ActB. Fair Credit Reporting ActC. Ethics in Advertising ActD. Unfair Trade Practices Act ------ d
Ethics is best described asA. laws and statutes enacted by duly elected representativesB. religious rituals and ceremoniesC. instructions on how to interact with fellow members of a group or communityD. a society's laws and regulations ------ c
Which of the following is the goal of a sales presentation?A. To educate the client so the client can make her own decisions about what's right for herB. To sell the client as many products as possibleC. To convince the client that the producer's recommendations are bestD. To explain the rules and regulations governing particular insurance products ------ a
Which of the following is not part of a sales presentation?A. Review and re-establish the client-producer relationshipB. Introduce the recommended policyC. Review the product applicationD. Review the client's needs and priorities ------ c
Which of the following should a producer not do during a presentation?A. Explain and educateB.Sell a policyC. Motivate the clientD. Openly discuss a policy's limitations ------ b
All of the following are reasons why it is seldom in the best interest of a policyholder to replace a life insurance policy with a new one exceptA. most of the first-year premium is swallowed up in commissionB. replacement policies are never in the best interest of the policyownerC. the premium is higher because the insured is olderD. waiting periods begin anew ------ b
Diverting insurance funds for personal use is an example ofA. replacementB. rebatingC. misuse of premiumsD. misrepresentation ------ c
Selling variable universal life insurance policies as mutual funds is an example of a prohibited practice calledA. twistingB. misrepresentationC. replacementD. rebating ------ b
When an agent spreads a false story that damages a competing agent's reputation, the offense is calledA. twistingB. defamationC. disclosureD. rebating ------ b
When values of an insurance policy are used to purchase another policy with the same insurer for the sole purpose of earning additional premiums or commissions, the practice is calledA. replacementB. misallianceC. rebatingD. churning ------ d
Which of the following is an objective of the NAIC?A. To promote federal legislation of the insurance industryB. To encourage uniformity in state insurance laws and regulationsC. To develop continuing education courses for insurance producersD. To develop model insurance policies for adoption by insurers ------ b
Which of the following is not a provision of NAIC's Life Insurance Illustrations Model Regulation?A. Each policy illustration must be accompanied by a written explanation or policy summary.B. Each policy illustration should use the words vanish and vanishing premium sparingly.C. Each policy illustration must show that cash values and coverage vary depending on changes in an insurer's costs and dividends,.D. Each policy illustration must be complete. ------ b
Which of the following is not part of a product presentation?A. Explaining policies B. Asking for referralsC. Motivating the clientD. Discussing a policy's limitations ------ b
The use of preprinted material in a sales presentation is recommended for which of the following reasons?A. The agent doesn't have to know exactly how a product works.B. It saves a lot of time and explanations.C. Such material generally has been reviewed for compliance.D. The agent can give it to the client instead of the answering the client's questions. ------ c
The purpose behind full disclosure requirements is toA. make sure a client is told everything there is to know about a productB. help a client make an informed decisionC. make sure agents comply with the letter of the lawD. help a client distinguish one insurer's product from a similar offering from another insurer ------ b
Jim gives Bill a couple of tickets to a baseball game to thank him for purchasing a policy. This is an example ofA. rebating B. twistingC. replacement D. churning ------ a
Which of the following is an example of churning?A. illegally inducing a person  to drop existing insurance to purchase similar coverage with another agent or companyB. Rephrasing a policy provision in such a way that it says just the opposite of the originalC. Replacing a policy with the intent of earning additional premiums or commissionsD. Representing an insurance policy as a retirement plan ------ c
Melanie is a newly licensed producer. A customer calls and asks for some product recommendations, but Melanie thinks that she is not yet qualified to help the customer. Therefore, Melanie has an ethical responsibility toA. answer the customer's questions on the basis of her current knowledge and then send a letter confirming their conversationB. assure the customer that because she is licensed, there is a presumption that the advice Melanie gives is reliableC. refuse to speak to the customerD. seek help from a more experienced colleague or other professional before responding to the customer's questions ------ d
Solicitation of insurance includes\A. inviting prospective purchasers to enter a contract for an insurance productB. making general or specific recommendations concerning insurance productsC. comparing insurance products, advising on insurance matters, or interpreting policies or coveragesD. all of the above ------ d