What must an agent do when using statistics in an advertisement?

a$.$ They must only use statistics that are less than one year old.

b$.$ The statistics must be referenced and verifiable.

c$.$ Statistics are not permitted in advertisements.

d$.$ They may only use government$-$supplied statistics.

Harriet plans to recommend a high cash value life insurance policy to her client in order for him to obtain supplemental income at retirement. What is the first issue that she should consider before she can ethically make such a recommendation?

a$.$ The client must have taken advantage of all other tax$-$advantaged means of providing supplemental retirement income.

b$.$ The proposed insurance policy must be universal life insurance.

c$.$ The client must have a need for the policy's life insurance benefit.

d$.$ The client must expect to be in a lower tax bracket after retirement.

When completing an insurance application on her proposed insured, Agent Audrey edited the applicant's responses to some health questions and eliminated certain information she felt was irrelevant. Which statement is correct with respect to Audrey's actions?

a$.$ An agent has an ethical and legal duty to record an applicant's answers on the application as given. Audrey's actions were unethical and increased the risk that her client's coverage could be rescinded.

b$.$ Applicants for insurance are often unaware of what is meaningful information to an underwriter, and Audrey was correct in limiting the applicant's responses only to the information that she considered important.

c$.$ The ethical value of Audrey's actions depends on whether she is an agent or a broker, because brokers must ensure that their client obtains the coverage needed.