Virginia-Life-Annuities-and-Health-Insurance Exam Dumps - Virginia Life, Annuities, and Health Insurance Examination Series 11-01

Renewable term insurance renews at the insured’s attained age, not the original issue age. Thus, at renewal after five years, the premium is based on age 40 rates.

Exact Extract (Virginia Life Insurance Study Guide): “Renewable term—premiums increase at renewal based on the insured’s attained age.”

References (Virginia Documents / Study Guide):

— Virginia Life Insurance Examination Outline, Term Insurance Features

A class designation of beneficiary is used when the policyowner wishes to name beneficiaries as a group rather than listing each individual by name. This method is especially useful when the number or identity of beneficiaries may change over time. Naming “the insured’s children” allows all individuals who meet that description at the time of the insured’s death to share in the proceeds, including children born after the policy is issued. This avoids the need to update beneficiary designations whenever family circumstances change. Donating proceeds to a charity requires naming a specific organization, not a class. Establishing a trust requires a trust to be named as beneficiary, which is not a class designation. Naming a specific person to act on behalf of others is also not a class designation because the beneficiary must be clearly defined. Therefore, naming children as a group without listing them individually is the proper use of a class designation.

When replacing existing health insurance in Virginia, it is required by law that a replacement disclosure must appear in the application for new coverage. The purpose of this requirement is to inform the policyholder about the implications of replacing existing health insurance with a new policy. This ensures transparency and helps prevent consumers from losing necessary coverage or facing gaps in their benefits.

Medical expense claim forms generally focus on the occurrence, character, and extent of the loss to determine the eligibility and amount of benefits. The employee's annual salary is not typically included on the claim form unless the claim relates to a disability or income replacement policy, but not for medical expense claims.

In a non-qualified deferred annuity, the owner’s cost basis is the total amount of premiums paid into the contract. This figure is used to determine the taxable and non-taxable portions of withdrawals and annuity payments.

Earnings in the annuity grow tax-deferred, and when distributions occur, amounts exceeding the cost basis are taxable as ordinary income. Opportunity cost and cash values are unrelated to tax basis calculations.

Virginia exam standards emphasize understanding cost basis to correctly apply annuity taxation rules, making option B correct.

A preferred risk classification is typically available for life insurance applicants who have a better-than-average life expectancy. These individuals are generally in excellent health, have no significant medical issues, and engage in behaviors that reduce health risks, such as non-smoking. Applicants in this category are eligible for lower premiums because they are considered lower risk.

Detailed Answer in Step-by-Step Solution:

Designating a beneficiary "by class" means identifying a group (e.g., "my children") rather than naming specific individuals (C).

Option A (business life insurance) is unrelated to class designation.

Option B (no primary beneficiary) is incorrect; a class can still be primary.

Option D (unrelated beneficiaries) is not a requirement of class designation.

The Virginia study guide notes that a class designation identifies beneficiaries by a category (e.g., "spouse" or "heirs") rather than specific names, offering flexibility. Reference: Virginia Life, Annuities, and Health Insurance study guide, section on "Beneficiary Designations."

Virginia law requires insurers to provide each group member with a certificate that summarizes the group policy’s benefits and features, including coverage, exclusions, and how to file claims.

Exact Extract (Virginia Group Health Law): “Each individual insured under a group health policy shall be provided with a certificate summarizing the essential features of the insurance coverage.”

References (Virginia Documents / Study Guide):

— Code of Virginia §38.2-3521.2 (Certificates of coverage under group health policies)