Free Annuities Practice Questions
New Mexico Life, Accident & Health exam (series 18-27) — 68 practice questions.
Subtopics: Annuity purpose, Accumulation phase, Fixed annuity, Variable annuity, Annuity suitability, Surrender charge, Annuity payout math, Annuitant, Suitability documentation, Free-look seniors, Annuity grace period, Annuity incontestability, Annuity best interest, Annuity training, Annuity free look, Principles, Immediate vs deferred, Products, Payment options, Uses, Taxation, Parties to an annuity, Flexible premium annuity, Cash refund option, Installment refund option, Period certain option, Annuity units, Separate account, Tax-deferred accumulation, Exclusion ratio, Early withdrawal penalty, Annuitization, Death before annuitization, Qualified vs nonqualified, Structured settlement, Annuity exclusion ratio, Indexed annuities, Market value adjustment, Variable annuities, Payout options, Bonus annuities, Annuity disclosure, Annuity death benefit, Annuity taxation, 1035 exchanges, Surrender charges, Parties, Suitability
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Sample questions & answers
1. The primary purpose of an annuity purchased by a New Mexico consumer is to:
Create a stream of income, often for retirement
An annuity is primarily designed to liquidate a sum into a stream of income, commonly used for retirement.
2. During the accumulation phase of a New Mexico deferred annuity:
Funds are paid in and grow tax-deferred
In the accumulation phase the owner pays in funds that grow tax-deferred until annuitization or withdrawal.
3. A fixed annuity issued in New Mexico generally guarantees:
A minimum interest rate and fixed income payments
A fixed annuity guarantees a minimum interest rate during accumulation and fixed-dollar payments during payout.
4. A producer selling a variable annuity in New Mexico generally must also hold:
An appropriate securities registration in addition to a life license
Variable annuities are securities, so the producer must hold the proper securities registration along with a life insurance license.
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Practice: Annuities
Answer choices are shuffled every time, and every question comes with an explanation.
Practice questions are study aids generated for exam preparation and are not actual exam questions. Content is provided for educational purposes and is not legal advice. Verify current statutes, rules, and exam specifications with the Insurance Department and the exam administrator before relying on it.
