Question 1

These policies provide a death benefit when the insured dies during a specified period. The term of this type of policy is usually not less than one year, but may be up to 40 years or more. It provides only temporary protection because coverage ends at the end of the term of coverage stated in the policy. What are these?

Accepted Answer

Term life insurance policies provide a death benefit during a specified period and offer temporary protection, ending when the term expires.

Question 2

_____________ insures two lives under one policy. Death benefits are paid to the surviving insured. The surviving insured usually has the option of purchasing an individual whole life policy of the same face amount without providing evidence of insurability.

Accepted Answer

The answer of _____________ insures two lives under one policy....

Question 3

Risks associated with compliance with laws and regulations may actually _________ impact ________ in ________. Choose the correct set.

Accepted Answer

Compliance with laws and regulations can sometimes negatively impact an organization's goals in the short term due to the costs and resources required to meet compliance standards.

Question 4

Basel II aims to improve the security and long-term viability of the financial system by focusing on bank's ____________

Accepted Answer

The answer of Basel II aims to improve the security...

Question 5

Homeowner policies combine property and casualty coverage into the same policy (known as multi-line policies). Homeowner policies provide four types of property coverage. All of the following are out of those EXCEPT:

Accepted Answer

Medical coverage is not a type of property coverage; it is a type of liability coverage included in homeowner policies. The four types of property coverage are dwelling, personal property, loss of use, and other structures.

Question 6

__________pays damaged insured by the injured and the insured's passenger when injured in an auto accident caused by a motorist without liability insurance. The coverage also covers accidents caused by hit-and-run drivers.

Accepted Answer

Uninsured motorist coverage pays for injuries to the insured and their passengers in an accident caused by a driver without liability insurance or a hit-and-run driver.

Question 7

Foreign currency futures contracts may be legitimately traded either on a recognized futures exchange or in the ___________, which generally involves trading between large institutions such as banks and corporations.

Accepted Answer

The answer of Foreign currency futures contracts may be legitimately...

Question 8

Some of the countries that do not permit companies to use IAS without a reconciliation to domestic generally accepted accounting principals are all EXCEPT:

Accepted Answer

The US, Canada, and Hong Kong all permit companies to use IAS without a reconciliation to domestic generally accepted accounting principals. Japan does not.

Question 9

The tax implications are to be considered in case of life insurance. As, you can take out in chunks to supplement the income, and minimize tax burden, while keeping the majority still under the tax differed status (Not to mention the benefit of Roth IRA).So, the end result of what you have is for disposable income is once again better with the:

Accepted Answer

The answer of The tax implications are to be considered...

Question 10

General liability insurance covers the major liability exposure of a business, including lawsuits against an organization's facilities or products. General liability insurance does not cover:

Accepted Answer

General liability insurance typically does not cover liabilities related to the use of automobiles, which are usually covered under a separate commercial auto insurance policy.

Question 11

The risks associated with operating objectives include all of the following EXCEPT:

Accepted Answer

Financial institute is not directly related to operating objectives, which focus more on internal processes and efficiency rather than external financial entities.

Question 12

Asset/liability management is a planning tool designed to maximize earnings. ALM tries to create optimal risk/reward decisions and focuses on creating prices that achieve a desired spread. A sound ALM policy must manage many types of risks such as:

Accepted Answer

A sound Asset/Liability Management (ALM) policy must manage various types of risks, including credit risk, liquidity risk, and capital risk, among others, to ensure optimal risk/reward decisions and maintain financial stability.

Question 13

Sarbanes Oxley and bases are:

Accepted Answer

Sarbanes-Oxley refers to a set of regulatory reporting requirements for public companies to enhance transparency and prevent corporate fraud.

Question 14

The EU saving Directive is aimed at effective taxation of saving income in the form of:

Accepted Answer

The EU Savings Directive is specifically aimed at the taxation of interest payments on savings income.

Question 15

Insurance companies assist individuals in managing personal risk through risk pooling. Risk pooling is based on fact that the probability of any one type of loss occurring for a given individual is small. Therefore insurers can insure:

Accepted Answer

Insurance companies can insure a large number of people against a given peril because the probability of any one individual filing a claim is small, allowing them to spread the risk across many policyholders.

Question 16

The term umbrella market segmentation is referred to:

Accepted Answer

Umbrella market segmentation is a strategy used by financial services companies, including banks, insurance companies, and brokerage houses, to target multiple customer segments with a single product or service.

Question 17

Whole life policies accrue a cash value that the insurer must surrender to the policyholder if the policy does not remain in force until the policyholder's death. The actual cash value payable to the policyholder in this circumstance would be:

Accepted Answer

The cash value payable is reduced by any surrender charges and any outstanding policy loans or repayments.

Question 18

It provides additional living expenses when the home is unlivable, so home owners can continue to live comfortably. While the home is made livable, the homeowner policy will pay for items such as rented rooms at a hotel, restaurant meals, and laundry expenses. What is it?

Accepted Answer

Loss of use coverage in a homeowner's policy provides for additional living expenses when the home is unlivable due to a covered loss.

Question 19

____________insurance provides a specified benefit amount in either of the following cases: If the insured survives to the maturity date of the policy is reached. If the insured dies before the maturity date of the policy is reached.

Accepted Answer

Endowment insurance provides a benefit if the insured survives to the policy's maturity date or if the insured dies before the maturity date.

Question 20

Main areas within financial services are:

Accepted Answer

The answer of Main areas within financial services are:
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Exam 1: Certified Financial Services Auditor