Unlock hundreds more features
Save your Quiz to the Dashboard
View and Export Results
Use AI to Create Quizzes and Analyse Results

OR
Sign inSign in with Facebook
Sign inSign in with Google
Quizzes > Business & Finance > Finance & Economics

New York Life Insurance Quiz - Test Your Expertise

Think you can ace the New York insurance exam? Start the quiz and challenge yourself with targeted new york life insurance questions!

Difficulty: Moderate
2-5mins
Learning OutcomesCheat Sheet
Paper art quiz illustration with insurance icons coins and question mark for New York Life Insurance on dark blue background

Ready to prove your expertise with our New York Life Insurance Quiz? This free new york life insurance questionnaire is designed for ambitious professionals and curious learners eager to test their understanding of policies, eligibility rules, annuities, riders, premium structures and real-life claim scenarios. Whether you're prepping for the new york insurance exam or brushing up on the new york life and health insurance exam, you'll discover clear explanations, practical examples, and practice dives into engaging scenarios . Each question mirrors industry best practices and even offers a new york life insurance quizlet-style review to reinforce your knowledge. It's perfect for both seasoned agents and newcomers looking for a comprehensive refresher. Click start the quiz now to challenge yourself, boost your confidence, and ace your next certification!

Which type of life insurance policy provides coverage for a specified period and has no cash value?
Universal Life Insurance
Term Life Insurance
Variable Life Insurance
Whole Life Insurance
Term life insurance offers pure death benefit protection for a set term without accumulating cash value. It is generally the most affordable form of life insurance for temporary needs. Unlike permanent policies, it cannot be surrendered for cash. Learn more about term life insurance.
What is the portion of a permanent life insurance policy that accumulates over time and can be borrowed against?
Premium
Death Benefit
Cash Value
Policy Fee
Cash value is the savings component of a permanent life insurance policy that grows over time on a tax-deferred basis. Policyholders may take loans against this value or make partial withdrawals. It's distinct from the death benefit paid to beneficiaries. Read more about cash value.
Who receives the proceeds of a life insurance policy when the insured passes away?
Policy Owner
Agent
Beneficiary
Underwriter
The beneficiary is the person or entity designated to receive the death benefit upon the insured's death. The policy owner names and can change the beneficiary, subject to any irrevocable designations. Beneficiaries may be primary or contingent. More on beneficiaries.
What term describes the periodic payment made to keep a life insurance policy in force?
Premium
Surrender Charge
Fee
Dividend
A premium is the payment required to maintain an insurance policy. It may be paid monthly, quarterly, or annually, depending on the contract. Failure to pay within the grace period can lead to policy lapse. Understand insurance premiums.
What is the 'grace period' in a life insurance contract?
Time after premium due date when coverage remains
End of term conversion window
Period before policy issue
Time to file a claim
The grace period is a set time after the premium due date during which the policy remains in force while the insurer waits for payment. It's commonly 30 or 31 days. If the premium isn't paid by the end, the policy lapses. Learn about the grace period.
What is a 'free look' period in life insurance?
Conditional coverage period
Underwriting waiver window
Discount on first-year premium
Time to review policy and cancel for full refund
The free look period allows a new policy owner to review their policy and cancel it within a specified time (often 10-30 days) for a full premium refund. It protects buyers from unwanted coverage. Requirements vary by state. Details on free look periods.
Which of the following riders waives future premiums if the insured becomes disabled?
Waiver of Premium Rider
Accelerated Death Benefit Rider
Accidental Death Rider
Guaranteed Insurability Rider
The Waiver of Premium Rider suspends premium payments if the insured meets the rider's disability definitions. Coverage continues without out-of-pocket premiums. This protects policyholders in case of long-term disability. More on waiver of premium.
What does 'underwriting' in life insurance refer to?
Paying agent commissions
Assessing applicant risk and determining policy terms
Marketing a policy
Setting premium payment dates
Underwriting is the process insurers use to evaluate risk, review medical and financial information, and set premiums or issue restrictions. It ensures that the insured's risk class aligns with pricing. Reinsurers often review large or unusual cases. Learn about underwriting.
In life insurance, what is a 'premium loan'?
A loan against a policy's cash value to pay premiums
A loan from an insurer to purchase a policy
A loan to buy additional riders
A loan to the insurer for reinsurance
A premium loan uses the policy's cash value as collateral to cover premium payments when the owner cannot pay out of pocket. Interest accrues on the loan and reduces death benefit or cash value if unpaid. It prevents policy lapse. More on premium financing.
What type of policy owner flexibility allows changing the death benefit and premium schedule?
Term Life Insurance
Universal Life Insurance
Group Life Insurance
Industrial Life Insurance
Universal life insurance offers adjustable premiums and death benefits within policy limits, providing flexibility to meet changing needs. The policy's cash value earns interest tied to insurer rates. Withdrawals and loans affect the death benefit. Universal life explained.
Which settlement option pays income for the life of the beneficiary?
Interest-Only Option
Life Income Option
Fixed Period Option
Lump-Sum Option
The life income option converts the death benefit into an annuity that pays the beneficiary a guaranteed income for life. Payments cease at death. Other options include lump-sum, fixed period, or interest-only. Settlement options overview.
What is an 'insurable interest' in life insurance?
Right to cancel policy anytime
Option to convert policy
Financial or emotional stake in insured's continued life
Right to change a beneficiary
Insurable interest means the policy owner must suffer financial or certain emotional loss if the insured dies. It prevents wagering on strangers' lives. It's required at policy issue, but not at claim. Learn about insurable interest.
Which policy term refers to the total amount of coverage stated on the policy face?
Net Amount at Risk
Face Amount
Paid-Up Additions
Cash Value
The face amount is the initial death benefit specified in the policy. It excludes cash value and does not change unless the policy has adjustable features. Riders added will increase the total benefit. Face amount definition.
What is the policy provision that prevents contesting the policy after a certain period?
Misstatement of Age Clause
Ownership Clause
Incontestability Clause
Underwriting Clause
The incontestability clause restricts the insurer from voiding the policy after it has been in force for usually two years, except for nonpayment of premiums. This protects the insured against late challenges. Incontestability clause details.
Which of the following is NOT a nonforfeiture option in whole life policies?
Reduced Paid-Up Option
Paid-Up Additions Option
Extended Term Option
Cash Surrender Option
Paid-Up Additions is a dividend option, not a nonforfeiture option. The three nonforfeiture options are cash surrender, reduced paid-up, and extended term insurance. These allow policyholders to retain some value if they stop paying premiums. Nonforfeiture options explained.
What is the primary function of an annuity?
Provide a stream of income, often for retirement
Pay a death benefit upon death
Underwrite life insurance policies
Offer cash surrender options
An annuity is designed to accumulate funds and then liquidate them in periodic payments, often during retirement. It can be fixed or variable and deferred or immediate. Unlike life insurance, the payment stops with the contract. Annuities explained.
Which life insurance policy feature allows conversion from term to permanent coverage without evidence of insurability?
Conversion Privilege
Accelerated Death Benefit Rider
Renewability Clause
Waiver of Premium Rider
A conversion privilege lets policyholders convert term life to a permanent policy within a specified period regardless of health changes. The face amount converted is often limited to the original amount. No new underwriting is required. Conversion privilege details.
Which dividend option on a participating whole life policy uses dividends to purchase one-year term insurance?
Paid-Up Term Option
Reduce Premium Option
Accumulate at Interest Option
Cash Option
The Paid-Up Term option, also called one-year term, applies dividends to buy term insurance equal to the policy's face amount for one year. It's often used to boost overall coverage at low cost. Dividend options explained.
What is a 'modified endowment contract' (MEC) for tax purposes?
A universal life policy with variable account
An annuity contract held inside life insurance
A policy overfunded beyond IRS limits
A term policy with extended maturity
A MEC is a life insurance policy funded too quickly (exceeding IRS 7-pay limits), triggering less favorable tax treatment of distributions. Withdrawals and loans are taxed and penalized like annuities. It retains death benefit status. IRS guidance on MECs.
Which term describes the profit-sharing feature in mutual life insurance companies that may provide policyholder refunds?
Commission
Dividend
Rebate
Premium Holiday
Mutual insurers pay policy dividends when actual experience is better than assumed in pricing. Dividends are not guaranteed but represent a refund of excess premium. They can be taken in cash, applied to premium, or used to buy paid-up additions. Insurance dividends.
What is the effect of a policy loan on a universal life insurance death benefit if unpaid at death?
Loan is forgiven
Loan is repaid with no impact
Death benefit is reduced by loan plus interest
Interest is waived
Outstanding loans and accrued interest reduce the death benefit payable to beneficiaries. The insurer deducts the total loan balance from the policy proceeds. This prevents the insurer from paying more than the net risk. Universal life details.
Which universal life feature guarantees the policy will remain in force as long as minimum premiums are paid?
Automatic Premium Loan
Cost of Insurance Charge
No-lapse Guarantee
Cash Surrender Value
A no-lapse guarantee ensures coverage will not terminate, even if cash value falls below the required level, provided specified premiums are paid. It protects against unfavorable interest or mortality charges. No-lapse feature.
In New York Life Insurance policies, what is the usual incontestability period?
One year
Two years
Three years
Six months
Most life policies, including those of New York Life, include a two-year incontestability clause. After two years, the insurer cannot contest statements in the application, except in cases of fraud. This period aligns with Model Regulation standards. Incontestability clause.
Which of these is a feature of a variable universal life policy?
Fixed interest credited monthly
No investment risk
Guaranteed cash value growth
Policyowner-directed subaccounts for cash value
Variable universal life policies permit allocation of cash value among separate account investments like equities and bonds. The policyowner bears investment risk and potential reward. Death benefit may fluctuate within guaranteed limits. Variable universal life.
What is the term for reducing the death benefit while keeping the policy in force without additional premiums?
Paid-Up Additions
Extended Term Option
Cash Surrender Option
Reduced Paid-Up Option
The reduced paid-up option uses cash value to purchase a single-premium paid-up policy with a lower face amount. Coverage continues for life with no further premiums. It's one of three nonforfeiture choices. Nonforfeiture options.
Which factor is NOT typically considered in life insurance underwriting?
Applicant's favorite music
Tobacco use
Occupation
Medical history
Underwriters assess risk factors like health, lifestyle, occupation, and tobacco/alcohol use. Favorite music has no bearing on mortality risk. Accurate underwriting ensures premiums align with risk. Underwriting basics.
Which return of premium term rider refunds all premiums if the insured outlives the term period?
Waiver of Premium Rider
Term Conversion Rider
Return of Premium Rider
Accelerated Death Benefit Rider
A Return of Premium rider refunds a portion or all of the premiums paid if the insured survives the term. It increases the cost of coverage but returns money, reducing the policy's net cost. Return of premium term.
What is the difference between joint life and survivor life annuities?
Survivor continues payments after first dies; joint stops
Survivor pays only if both alive
They are identical
Joint pays only if both die
A joint life annuity stops upon the first person's death, whereas a joint-and-survivor annuity continues payments to the surviving beneficiary. This ensures ongoing income for two lives. Joint and survivor annuities.
Which life insurance principle states that insurers must spread the risk of loss among a large number of insured units?
Adhesion
Principle of Utmost Good Faith
Insurable Interest
Law of Large Numbers
The law of large numbers allows insurers to predict losses more accurately by aggregating many similar exposures. It underpins premium setting and reserve calculations. The larger the pool, the more predictable outcomes become. Law of large numbers.
Under Section 7702 of the Internal Revenue Code, what test must a policy meet to qualify as life insurance?
Face Amount Test
Cash Value Accumulation Test or Guideline Premium Test
Medical Underwriting Test
Beneficiary Designation Test
Section 7702 specifies that policies meet either the Cash Value Accumulation Test or the Guideline Premium and Corridor Test to maintain favorable tax status. These limit funding to prevent the contract from becoming an investment vehicle. Failure disqualifies tax benefits. 7702 definitions.
What is 'negative arbitrage' in a universal life policy context?
Premium greater than face amount
Policy lapsing before end of term
Dividend paid lower than expected
Interest crediting rate below cost of insurance charge
Negative arbitrage occurs when the insurer's credited interest rate is lower than the policy's COI charges, causing cash value erosion. It can lead to lapses without additional premium. Understanding arbitrage helps manage UL risk. Arbitrage concept.
Which type of annuity allows the owner to allocate premiums among subaccounts with varying risk and return?
Fixed Annuity
Immediate Annuity
Variable Annuity
Indexed Annuity
Variable annuities invest in separate accounts where returns depend on asset performance. Owners choose among subaccounts representing stocks, bonds, or money-market instruments. They bear investment risk. Variable annuities explained.
In New York state, which regulatory body licenses life insurance agents?
National Association of Insurance Commissioners
New York State Department of Financial Services
Securities and Exchange Commission
Federal Insurance Office
The New York State Department of Financial Services regulates and licenses insurance agents and brokers in New York. It enforces state insurance law and consumer protections. The NAIC provides model laws but not licensing. DFS consumer resources.
What is the 'corridor requirement' in the Guideline Premium Test?
Maximum number of policy loans
Maximum premium relative to death benefit
Minimum premium payment interval
Minimum death benefit relative to cash value
The corridor requirement mandates a minimum ratio between death benefit and cash value to prevent policies from being overly funded. The corridor widens with age. It ensures the policy remains primarily insurance, not investment. IRC Section 7702 corridor details.
Which investment is NOT typical within a universal life policy's general account?
Common stock mutual funds
Mortgages
Corporate bonds
Government securities
General account assets are invested conservatively in bonds, mortgages, and government securities. Equity mutual funds and direct stocks are generally held in separate accounts of variable products, not general accounts. General vs separate accounts.
What defines a 'modified guaranteed universal life' (MGUL) policy?
Automatically increasing face amount
Guaranteed death benefit with flexible funding
Variable cash value tied to market
Premium waiver on mortgage loans
MGUL blends universal life's premium flexibility with death benefit guarantees. It requires a schedule of minimum premiums to maintain the guaranteed face amount. Cash value accrues but isn't the focus. MGUL details.
How are dividends treated for U.S. federal tax purposes when paid on a mutual insurer's policy?
They are considered a return of premium and not taxable to extent they don't exceed premiums paid
Taxed at capital gains rates
Fully taxable as ordinary income
Taxable only if kept in policy
Life insurance dividends are a non-taxable return of premium up to the total premiums paid. Amounts exceeding cumulative premiums may be taxable. They're not considered income or capital gains if they don't surpass basis. IRS publication on insurance dividends.
Which of these is a primary purpose of a viatical settlement?
Reinstate a lapsed policy
Allow terminally ill insured to sell policy for immediate cash
Provide annuity payments to beneficiaries
Convert term to permanent life insurance
A viatical settlement permits a terminally ill insured to sell their life insurance policy to a third party at a discount, receiving immediate funds. The buyer collects the death benefit. It's regulated at state level. Viatical settlement overview.
Which of these riders is most useful for estate liquidity planning?
Guaranteed Insurability Rider
Accelerated Death Benefit Rider
Term Conversion Rider
Child Term Rider
An accelerated death benefit rider allows access to a portion of the death benefit if the insured becomes terminally ill, aiding in estate liquidity or medical expenses. It reduces estate tax impact on heirs. Accelerated death benefit info.
What is the primary regulatory standard for life insurance product approval in New York?
Prior approval by DFS before marketing
File-and-use after marketing
Use-and-file after marketing
Self-certification by insurer
New York requires prior approval of life insurance policy forms and rates by the Department of Financial Services before they can be sold. This review is among the strictest in the U.S. NY DFS insurance guidance.
In life insurance taxation, how is a policy loan treated for the borrower?
Taxable only if policy lapses
Tax-free forever
Fully taxable immediately
Not taxable as income, but interest is due
Policy loans are not treated as taxable income at the time of loan, as they're collateralized by the policy's cash value. However, if the policy lapses with a loan outstanding, the loan amount above basis becomes taxable. Interest accrues. Tax treatment of life policy loans.
Which statement best describes a 'jeopardy assessment' in mutual insurance surplus management?
Fee for late premium payments
Commission clawback to agents
Premium surcharge for high-risk insureds
Charge paid by policyowners if surplus drops below required level
A jeopardy assessment is a rare charge levied on policyowners when insurer surplus falls below regulatory or contractual requirements. It spreads financial strain among members. Few modern policies include this. NAIC on jeopardy assessments.
Under New York Law, what is the minimum reserve valuation method for traditional whole life policies?
Net Level Premium Reserve
Policy Value Reserve Method
Commissioners Reserve Valuation Method (CRVM)
Cash Surrender Reserve
New York requires the CRVM for traditional compliant reserve calculations. CRVM sets conservative assumptions for mortality, interest, and lapse rates to ensure policyholder security. Other states may allow the VM-20. CRVM basics.
What federal law governs replacement of life insurance policies and requires insurers to notify existing companies?
The Affordable Care Act
NAIC Model Regulation #590
McCarran-Ferguson Act
ERISA
NAIC Model Regulation 590 sets replacement standards, including disclosures and insurer notifications during sales. New York adopted these rules to protect consumers from unsuitable replacements. Model Regulation 590.
Which statutory accounting principle requires insurers to discount unpaid losses and loss adjustment expenses?
SSAP 55R
GAAP
None; SAP does not discount unpaid losses
FASB ASC 944
Under Statutory Accounting Principles (SAP), unpaid losses and LAE are held at face value without discounting. This conservatism contrasts with GAAP. SAP prioritizes solvency and policyholder security. SAP vs GAAP for insurance.
In a Modified Endowment Contract, what penalty applies to distributions before age 59½?
10% penalty on taxable portion
5% penalty on total distribution
No penalty applies
20% penalty on policy loan
MEC withdrawals are taxed on a last-in, first-out basis and incur a 10% penalty on the taxable portion if taken before age 59½, similar to qualified retirement plans. This discourages overfunding life contracts for tax deferral. MEC distribution rules.
How does the McCarran-Ferguson Act affect federal regulation of insurance?
It requires insurers to file with SEC
It places insurance under exclusive federal oversight
It grants states primary authority over insurance regulation, limiting federal jurisdiction
It deregulates life insurance products
The McCarran-Ferguson Act of 1945 affirms that states, not the federal government, have primary authority to regulate and tax insurance. Federal antitrust laws apply only to the extent state law does not preempt them. McCarran-Ferguson Act text.
0
{"name":"Which type of life insurance policy provides coverage for a specified period and has no cash value?", "url":"https://www.quiz-maker.com/QPREVIEW","txt":"Which type of life insurance policy provides coverage for a specified period and has no cash value?, What is the portion of a permanent life insurance policy that accumulates over time and can be borrowed against?, Who receives the proceeds of a life insurance policy when the insured passes away?","img":"https://www.quiz-maker.com/3012/images/ogquiz.png"}

Study Outcomes

  1. Differentiate Policy Types -

    Analyze the characteristics of term, whole, and universal life insurance policies to accurately respond to new york life insurance questions.

  2. Determine Eligibility Criteria -

    Identify group and individual eligibility requirements for life insurance coverage in New York to master new york insurance exam content.

  3. Compare Annuity Options -

    Evaluate fixed, variable, and indexed annuities, understanding their benefits and limitations for use in the new york life and health insurance exam.

  4. Apply Key Exam Concepts -

    Recall essential terms and principles tested on the New York insurance exam to boost performance on this new york life insurance questionnaire.

  5. Enhance Test-Taking Skills -

    Use targeted quiz questions to gauge your knowledge gaps, improve recall, and build confidence for the new york life insurance quiz.

Cheat Sheet

  1. Term vs. Whole Life Insurance -

    Term life offers affordable, temporary coverage often used to protect specific financial obligations, while whole life provides permanent protection with cash”value accumulation (Society of Actuaries). Remember "Term is Temporary" - a handy mnemonic when tackling new york life insurance questions on your New York insurance exam.

  2. Group Life Eligibility Criteria -

    Under New York Regulation 58, group life plans require at least 2 employees in small groups or 50+ in large groups, with certificate holders defined per DFS guidelines. Use flashcards in your new york life insurance quizlet to recall these thresholds during the new york life and health insurance exam.

  3. Insurable Interest Requirement -

    New York mandates insurable interest at policy inception, meaning the policyowner must expect financial loss on the insured's death (NAIC model law). Think "Interest Instantly" to recall this key concept when reviewing the new york life insurance questionnaire.

  4. Annuity Types & Tax-Deferred Growth -

    Immediate annuities start payouts right away, while deferred annuities grow tax-deferred using FV = P × [((1 + r)^n - 1)/r] for contributions P at rate r (Journal of Financial Planning). Practicing this formula boosts your speed on annuity questions for the New York insurance exam.

  5. Policy Illustrations & Nonforfeiture Options -

    New York requires clear illustrations showing guaranteed and non-guaranteed values, plus nonforfeiture choices like cash surrender and reduced paid-up policies to protect value (NY State DFS). These terms often pop up in new york life insurance questions, so review them thoroughly in your quizlet set.

Make a Quiz (FREE) Copy & Edit This Quiz Create a Quiz with AI

Finance & Economics Quizzes

Powered by: Quiz Maker