A person who, for a fee, gives advice or recommendations on benefits provided by an insurance 

contract is called

1.a broker

2.a producer

3.an advisor

4.a navigator

3.an advisor

*An insurance adviser is any person who, for a fee, offers to examine any policy for the purpose 

of giving advice or recommendations with respect to the benefits provided by the contract. An 

adviser must be licensed in the State of Maryland.

If an insured's age on a life insurance policy has been misstated, what is the insurer's liability if 

the insured dies?

1.No death benefit is owed because of the misstatement of age

2. The full original death benefit listed on the policy

3. A prorated death benefit based on the amount of insurance the insured's premiums would have 

been if purchased at the correct age

4. The original death benefit listed on the policy minus any outstanding loans and interest

3. A prorated death benefit based on the amount of insurance the insured's premiums would have 

been if purchased at the correct age

How long must an individual be unable to engage in any gainful activity due to physical or 

mental disability in order to qualify for Social Security Total Disability?

1. 3 months

2. 6 months

3. 12 months

4. 18 months

3. 12 months

All of the following actions are considered rebating EXCEPT

1. sharing commissions with other licensed and appointed agents

2.refunding part of the premium as an inducement for purchase

3.offering special dividends

4. offering anything of value not specified in the policy

1. sharing commissions with other licensed and appointed agents

Peter has a policy where 80% to 90% of the premium is invested in traditional fixed income 

securities and the remainder of the premium is invested in contracts tied to a stipulated stock 

index. What kind of policy is this?

1. Modified Endowment Contract

2. Current assumptive whole life

3.Credit life insurance

4. Equity index whole life

4."Equity index whole life". The type of policy where 80% to 90% of the premium is invested in 

traditional fixed income securities and the remainder of the premium is invested in contracts tied 

to a stipulated stock index is equity index whole life.

A tax-free Section 1035 Exchange of a life insurance policy to a different policy is permitted if it 

occurs

1. in the same state as the original transaction

2. within a 12-month period

3. from insurer to insurer and no cash is received by the policyowner

4. from agent to agent as long as the agents are licensed in the same line

3. from insurer to insurer and no cash is received by the policyowner

*The Internal Revenue Code (IRC) enables a tax-free Section 1035 Exchange of a life insurance 

policy to a different policy if it occurs from insurer to insurer and the policyowner does not 

receive any cash.

According to life insurance contract law, insurable interest exists

1.when any business relationship exists

2. at the time of application

3. at the time of death

4. only when determined by a judge

2.at the time of application

*According to life insurance in contract law, a person most likely will have an insurable interest 

in insuring a person's life if at the time of application

An example of replacement is

1.canceling disability policy to buy a term life policy

2. canceling a term life policy to buy a whole life policy

3. canceling a long-term care policy to buy a whole life policy

4. canceling a whole life policy to buy a major medical policy

2.canceling a term life policy to buy a whole life policy

When must a claim on a life insurance policy be paid after proof of loss has been received by the 

insurer?

1. Promptly

2.Within 10 days

3. Within 20 days

4. Within 30 days

1. Promptl

Variable life insurance and Universal life insurance are very similar. Which of these features are 

held exclusively by variable universal life insurance?

1. Policyowner may increase or decrease the premium payments

2.Policyowner may increase or decrease the face amount

3.Policyowner can contribute large sums of money

4.Policyowner has the right to select the investment which will provide the greatest return

4.Policyowner has the right to select the investment which will provide the greatest return