OH-Life-Agent-Series-11-44 Exam Dumps - Insurance Licensing OHIO Life Insurance Questions and Answers

Life insurance premiums are calculated based on mortality (the likelihood of death), interest (investment earnings), and expenses (operational costs). Morbidity, which relates to illness rates, is primarily used in health insurance, not life insurance.

Aparticipating whole life insurance policyis issued by amutual insurerand may pay policy dividends to the policyholder. These dividends represent areturn of divisible surplus. Mutual insurers are owned by their policyholders and typically issue participating policies.

"A participating policy allows the policyholder to share in the insurer’s surplus earnings. These policies are most often issued by mutual insurers and return dividends which represent a portion of the divisible surplus."

Adjustable Life Insurance is a type of permanent life insurance that combines features of term and whole life insurance. It allows the policyowner to adjust two key policy features: the premium payment amount and the face amount (death benefit). This flexibility enables the policyowner to adapt the policy to changing financial needs and circumstances. Adjustments to the death benefit may require evidence of insurability, depending on the insurer's policies.

The Cost-of-Living Adjustment (COLA) rider allows the insured to increase the policy's face value based on increases in the Consumer Price Index (CPI). In this case, a 3% CPI increase on a $200,000 policy allows a proportional increase in the face amount.

Calculation: $200,000 × 0.03 = $6,000

Therefore, the new face amount can be increased by $6,000.

A "Period Certain" annuity, also known as a "term certain" or "fixed period" annuity, guarantees payments for a specified period, such as 10, 15, or 20 years, regardless of whether the annuitant lives or dies during that period. If the annuitant dies before the end of the period, the remaining payments are made to a designated beneficiary. This option provides a predictable income stream for a set duration.

If no living beneficiary exists at the time of the insured’s death, thedeath benefit is payable to the insured’s estate. This may be subject to probate.

"In the absence of a living beneficiary, the policy proceeds are paid to the estate of the insured."