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Maryland Life Producer Exam (Series 20-27)

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Total Questions : 90

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Question # 1

A policyholder uses a Section 1035 exchange to replace an existing life insurance policy. If the new policy is later surrendered, the gain realized on termination is taxed as:

Options:

A.  

Ordinary income

B.  

A capital gain

C.  

Ordinary income plus a 10% surcharge

D.  

A deferred capital gain

Discussion 0
Question # 2

A valid contract requires all of the following EXCEPT:

Options:

A.  

Offer and acceptance

B.  

Competent parties

C.  

Consideration

D.  

Written evidence

Discussion 0
Question # 3

A life insurance policy beneficiary's life expectancy has a direct bearing upon:

Options:

A.  

The policy value that will be includable in the insured's estate

B.  

The taxable portion of each benefit payment under a life income settlement option

C.  

The total amount payable under the policy as a result of the insured's death

D.  

The premium rate for each $1,000 of face amount

Discussion 0
Question # 4

The qualified first-time homebuyer distribution available in IRAs has a maximum lifetime limit per participant of:

Options:

A.  

$2,000

B.  

$5,000

C.  

$10,000

D.  

$20,000

Discussion 0
Question # 5

In determining the payment of accelerated life insurance benefits, all of the following are considered activities of daily living EXCEPT:

Options:

A.  

Dressing

B.  

Eating

C.  

Bathing

D.  

Speaking

Discussion 0
Question # 6

A refusal to do business with a particular individual or business is known as:

Options:

A.  

An estoppel

B.  

An injunction

C.  

A boycott

D.  

A binder

Discussion 0
Question # 7

A producer is prohibited from:

Options:

A.  

Selling insurance to family members

B.  

Allowing an applicant to sign a blank or incomplete application

C.  

Countersigning a policy sold in Maryland

D.  

Splitting commissions with a licensed nonresident producer who has jointly sold a policy

Discussion 0
Question # 8

In general practice, can the Maryland Insurance Administration inspect the business records of an insurance company or agency?

Options:

A.  

No, because of privacy considerations

B.  

Yes, because of the powers defined by state laws

C.  

No, because only an officer of the court can inspect these records

D.  

Yes, because all company and agency records are public domain

Discussion 0
Question # 9

Which activity is an unfair claims settlement practice?

Options:

A.  

Negotiating the payment of claims where coverage or liability is in question

B.  

Denying claims on the basis of specific policy provisions

C.  

Including an arbitration provision in the insurer's policies

D.  

Offering settlements that are less than the fair value to offset insurer expenses

Discussion 0
Question # 10

Which contract offers flexible deposits, deferred taxation, a guaranteed minimum interest rate, and death proceeds equal to the cash value?

Options:

A.  

An adjustable whole life insurance policy

B.  

Available deferred annuity

C.  

A flexible premium fixed annuity

D.  

A universal life insurance policy

Discussion 0
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