North Carolina Funeral Law Practice Exam

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Prepare for the North Carolina Funeral Law Exam with our comprehensive quiz. It includes helpful hints and multiple-choice questions to ensure you're ready for licensure. Understand the laws, regulations, and ethical practices necessary for a successful funeral service career.

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What percentage of investment income must burial associations also add to their reserve account?

  1. 2%

  2. 5%

  3. 6%

  4. 7%

The correct answer is: 5%

Burial associations in North Carolina are required to manage their finances responsibly to ensure they can meet their obligations to their members. One requirement is that a burial association must add a specified percentage of its investment income to its reserve account. The correct percentage is 5%. This stipulation is designed to enhance the financial stability of the association by ensuring that a portion of the income generated from investments is reinvested into the reserve account, which is crucial for covering future claims or benefits to members. Maintaining an adequate reserve is essential for the long-term viability of burial associations, and by allocating a portion of investment income, they can ensure that they remain solvent and can fulfill their commitments to members' families.

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