31.While life insurance protects the insured against the economic consequences of premature death, annuities protects against
a.the economic consequences of living too long.
b.varying interest rates.
d.default by life insurance companies.
32.To protect against moral hazard, disability income policies
a.do not cover disabilities from moral problems.
b.do not provide a high percentage of pre-disability income and require a waiting period.
c.usually pay more than 100 per cent of an insured's income.
d.usually require a five-year waiting period before benefits begin.
33.Life insurance companies have a portion of their assets invested in common stocks most likely because
a.there’s no other way to finance whole life insurance policies.
b.the company probably offers variable-life insurance policies.
c.it reduces the risk of the corporate bond portfolio.
d.common stockholders desire a small amount of their return in life insurance.
34.Insurance regulation is concerned with all but one of the following:
a.capital adequacy of insurance companies
b.making sure that the perils covered under insurance do not occur too frequently
c.protecting and informing consumers
d.keeping insurance available and affordable
35.All but one of the following are important areas of insurance regulation:
a.licensing of insurance companies and agents.
b.review of the financial condition of insurance companies.
c.annual safety inspection of insurance offices in each state.
d.the orderly liquidation of insolvent insurers.
36.While life insurance provides economic protection in case of premature death, pensions provide coverage against
b.working too long.
37.Private pension plans are
a.available only to people who work.
c.pensions provided by and to non-governmental, private sector businesses, organizations, and their workers.
d.a personal financial plan provided for a fee by a financial planner.
38.A noninsured pension plan will
a.not be covered under the Pension Benefit Guaranty Corporation.
b.always be underfunded.
c.be managed by an appointed trustee to invest funds contributed for the benefit of future pensioners.
d.will be covered by term insurance, not whole life.
39.The largest amount of pension assets are associated with
a.trusteed, private pension funds.
c.government-administered pension funds.
d.insured pension plans with life insurance companies.
40.Social security, formally called OASDHI, stands for
a.Office of Aging Survivors, Disabled and Health Insurance
b.Office of Active Standards for the Disabled, Healthy and Infirmed
c.Old Age, Survivors, Disability, and Health Insurance System
d.Old Age Standards for Disability Health Insurance