Life & Health: Chapter 20--18 Quiz

1. What is the important notice that everyone replacing a policy must be given according to Rule 16.1 concerning Replacement?

An Important Notice Regarding Replacement

Instructions on How to Cancel a Policy

Information on How to Renew a Policy

A Reminder to Check Policy Details

Rule 16.1 regarding Replacement mandates that everyone replacing a policy must be provided with an Important Notice Regarding Replacement. This notice is essential to ensure that all parties involved in the policy replacement process are informed and aware of the implications.

Explanation

Rule 16.1 regarding Replacement mandates that everyone replacing a policy must be provided with an Important Notice Regarding Replacement. This notice is essential to ensure that all parties involved in the policy replacement process are informed and aware of the implications.

2. Replacement includes borrowing this much or more from Cash Value.

25%

10%

50%

75%

In replacement scenarios, borrowing 25% or more from Cash Value is generally considered a risk factor.

Explanation

In replacement scenarios, borrowing 25% or more from Cash Value is generally considered a risk factor.

3. What is the term used to describe the effort of an existing company to keep a policy in force?

Conservation

Renovation

Retention

Reconstruction

Conservation refers to the act of maintaining or keeping a policy in force. Retention, Renovation, and Reconstruction do not specifically refer to the effort of an existing company to keep a policy in force.

Explanation

Conservation refers to the act of maintaining or keeping a policy in force. Retention, Renovation, and Reconstruction do not specifically refer to the effort of an existing company to keep a policy in force.

4. What is the Free Look Period for a Replacement Life policy?

20 days

30 days

15 days

10 days

The Free Look Period for a Replacement Life policy is typically 20 days, during which the policyholder can review the terms of the policy and cancel it if they are not satisfied.

Explanation

The Free Look Period for a Replacement Life policy is typically 20 days, during which the policyholder can review the terms of the policy and cancel it if they are not satisfied.

5. According to the Solicitation Regulation, what is every person required to be given along with a Buyer's Guide?

Policy Summary

User Manual

Liability Waiver

Product Catalog

The Solicitation Regulation mandates that every person must be provided with a Buyer's Guide and a Policy Summary.

Explanation

The Solicitation Regulation mandates that every person must be provided with a Buyer's Guide and a Policy Summary.

6. What is the term for lying in an attempt to replace a contract?

Fraud

Twisting

Misrepresentation

Deception

Twisting is the act of an insurance agent deceiving a policyholder in order to replace an existing insurance policy with a new one, usually without the policyholder's knowledge or understanding of the consequences. Misrepresentation, Fraud, and Deception are similar actions but not specifically related to replacing contracts.

Explanation

Twisting is the act of an insurance agent deceiving a policyholder in order to replace an existing insurance policy with a new one, usually without the policyholder's knowledge or understanding of the consequences. Misrepresentation, Fraud, and Deception are similar actions but not specifically related to replacing contracts.

7. Rule 16.1, Life Insurance Replacement, defines borrowing more than ______% of the Cash Value from a policy as replacement.

15

25

30

20

The correct percentage in Rule 16.1 for defining borrowing more than the Cash Value from a policy as replacement is 25%.

Explanation

The correct percentage in Rule 16.1 for defining borrowing more than the Cash Value from a policy as replacement is 25%.

8. Who is responsible for promulgating a Rule, similar to a law?

Governor

Attorney General

Secretary of State

Insurance Commissioner

Rules, like laws, are promulgated by the designated authority within a particular jurisdiction. In this case, the Insurance Commissioner is the appropriate official responsible for promulgating Rules related to insurance regulations.

Explanation

Rules, like laws, are promulgated by the designated authority within a particular jurisdiction. In this case, the Insurance Commissioner is the appropriate official responsible for promulgating Rules related to insurance regulations.