Series 63 practice questionmediumExempt Securities — Insurance Policies
An insurance policy or fixed annuity contract issued by an insurance company authorized to do business in the state is:
- ARequired to be registered as a security with the state Administrator
- BExempt from the definition of a security under the USA✓ Correct answer
- CConsidered a federal covered security
- DRegulated exclusively by FINRA
Explanation
Why B — Exempt from the definition of a security under the USA
Under USA Section 401(b), insurance policies and fixed annuity contracts issued by companies authorized to do business in the state are excluded from the definition of a security. Since they are not considered securities under the USA, registration requirements do not apply. However, variable annuities and variable life insurance are considered securities.
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