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Which of these statements concerning traditional iras is correct

October 29, 2022 by admin

Which of these statements concerning traditional IRAs is correct

Options:

a) Earnings are not tax deductible
b) Earnings are taxable when withdrawn
c) Contributions are never tax-deductible
d) Contributions are always made by the employer

The Correct Answer Is:

b) Earnings are taxable when withdrawn

Traditional Individual Retirement Accounts (IRAs) allow individuals to defer taxes on income earned in the account until it is withdrawn. This can significantly reduce an individual’s tax burden when withdrawing funds from their account. However, there are a few caveats to note with this strategy. First, earnings in an IRA are taxable when withdrawn regardless of whether the individual is using the money for retirement savings or other purposes. Second, if an individual has less than $1,000 in their IRA at the time of withdrawal, all of their earnings will be subject to taxation regardless of whether they have used the money for retirement savings or not.

What would be an expense factor in an insurance program

October 29, 2022 by admin

What would be an expense factor in an insurance program

Options:

A) Premiums collected
B) Mortality costs
C) Opportunity costs
D) Investment interest

The Correct Answer Is:

B) Mortality costs

Mortality costs would be an expense factor in an insurance program. Insurance companies are always looking for ways to reduce their expenses, which is why mortality costs may be a factor in an insurance program. Mortality costs are the expenses incurred due to deaths of policy holders. These expenses can include medical expenses, funeral services, and settlement payments. In recent years, insurers have been increasingly focused on reducing these costs by implementing programs that provide members with discounts or free coverage for specific types of injuries or illnesses.

Which statement regarding insurable risks is not correct

October 29, 2022 by admin

Which statement regarding insurable risks is not correct

Options:

A. The insurable risk needs to be statistically predictable.
B. An insurable risk must involve a loss that is definite as to cause, time, place and amount.
C. Insureds cannot be randomly selected.
D. Insurance cannot be mandatory.

The Correct Answer Is:

C. Insureds cannot be randomly selected

There is a misconception that insureds cannot be randomly selected for insurance risk. In reality, this is not true. Insurance companies can and do use random selection when selecting potential customers for insurance. Random selection ensures that all the possible risks are taken into consideration when issuing policies to customers.

Fixed annuities provide all of the following except

October 29, 2022 by admin

Fixed annuities provide all of the following except

Options:

A) Guaranteed interest
B) Retirement funds
C) Hedge against inflation
D) Tax advantage

The Correct Answer Is:

C) Hedge against inflation

Fixed annuities do not provide a hedge against inflation, as they are indexed to the rate of inflation. This means that if inflation rises, your guaranteed income will also rise, but if inflation falls, your guaranteed income will also fall. Fixed annuities do not provide a hedge against inflation as they are linked to the Consumer Price Index (CPI). Over time, CPI will rise more than the fixed annuity payout, resulting in a loss of purchasing power. In addition, variable annuities offer more flexibility and can provide a hedge against inflation by providing a higher payout if inflation rises faster than the fixed rate.

Which of the following products require a securities license

October 29, 2022 by admin

Which of the following products require a securities license

Options:

a) Equity Indexed annuity
b) Deferred annuity
c) Variable annuity
d) Fixed annuity

The Correct Answer Is:

c) Variable annuity

Variable annuities are products offered through brokers that allow investors to allocate a percentage of their investment into a variable annuity contract which pays out a fixed monthly income. These contracts must be sold through registered representatives and must be registered with the SEC. If an investor does not have a securities license, they may not buy or sell variable annuities.

All of the following are true about variable products except

October 29, 2022 by admin

All of the following are true about variable products except

Options:

A. Policyowners bear the investment risk
B. the premiums are invested in the insurer’s general account
C. the minimum death benefit is guaranteed
D. the cash value is not guaranteed

The Correct Answer Is:

B. the premiums are invested in the insurer’s general account

Variable products have become increasingly popular in recent years, as they offer an opportunity for insurers to generate greater returns while offering their customers a degree of customization. However, one drawback of variable products is that premiums are not typically invested in the insurer’s general account. This means that when there are periods of low activity, premiums may be lost as a result. As a result, it is important for insurers to carefully consider how they invest premiums in variable products in order to ensure that they are maximising their return potential.

Need of Insurance – 12 Important Needs of Insurance | Insurance

September 22, 2022 by admin

1) Economic protection is provided by insurance:

People and their property are protected economically by insurance. The property may be damaged or lost due to events such as fire, flood, lightning, earthquake, theft, or breakdown in machinery. Insurers provide financial protection against losses caused by specific risks to property. The property is not protected from any risk by insurance nor is it able to avoid any risk.

Losses cannot also be reduced by it. Such financial losses are only indemnified by it. The occurrence of fire cannot be prevented by a fire insurance policy. As a result, it compensates property owners for fire-related losses.

Characteristics of Insurance – 11 Major Characteristics of Insurance | Insurance

September 22, 2022 by admin

1) Insurance is a Contract

By means of insurance, two parties, namely the insurer and the insured, agree that the insurer will compensate the insured for certain probable risks in exchange for an insurance premium. In accordance with Indian Contract Act, insurance contracts are governed by the provisions pertaining to proposal, acceptance, consideration, competency of parties, lawful purpose, etc.

As a result of fire, marine, and general insurance, compensation is paid in the event of a certain event. A policyholder does not receive any compensation if there is no loss, nor is his or her premium refunded. If the insured person is still alive, the insurance company will pay them the amount of premium plus interest and bonus if the insured person dies.

Disability Insurance Quiz – Multiple Choice Questions (MCQs) | Disability Insurance

September 22, 2022 by admin

Disability insurance proceeds are taxable:

A) if the employee pays for the disability insurance
B) Never
C) Always
D) If the employer pays for the disability insurance

Answer: D) If the employer pays for the disability insurance

Marine Insurance Quiz – Multiple Choice Questions (MCQs) | Marine Insurance

September 22, 2022 by admin

Which of the following statements about marine insurance coverages is true?

A) Hull insurance limits coverage to the breakdown of a ship’s machinery and equipment.
B) Cargo insurance protects the shipowner for the loss of the earnings if a ship is lost of damaged and goods are not delivered.
C) Freight insurance covers the owner of cargo if the cargo is damaged or destroyed.
D) Protection and indemnity insurance provides liability insurance to the ship owner for bodily injury and property damage to third parties.

Answer: D