Test your basic knowledge |

CA Life Agent Exam

Subject : certifications
Instructions:
  • Answer 50 questions in 15 minutes.
  • If you are not ready to take this test, you can study here.
  • Match each statement with the correct term.
  • Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. Representation - oral or written statement made to best of knowledge or belief; Warranty - statement guaranteed/presumed/understood to be true.






2. A company providing lump sum buyout (50-90% of total) of Life policy; becomes owner & beneficiary & assumes premium payments; usually terminally ill viator.






3. Waives premium on Life policy for minor child until age 21 in event premium payor dies or becomes disabled.

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4. Federal law allows employees/their dependents to continue group benefits w/in 60 days after termination (if employer has 20+ employees); Insured pays premium @ 102% of group cost.






5. IRS allows tax-free transfer of cash values between 2 LIKE policies (i.e. Life to Life - Annuity to Annuity - or Life to Annuity).






6. Written contract that provides INCOME @ high interest rate for fixed period OR for annuitant's lifetime w/ possible death benefit.






7. Permanent disability due to total loss of sight - hearing - speech or use of 2 + limbs; benefits paid even while continuing to work.






8. Mathematical law stating the larger # of occurrences - the more predictable the losses; used to calculate premiums.






9. After 2-3 yrs. - Whole Life policy equity builds tax-deferred @ fixed interest rate until it equals death benefit; borrowable but taxable.






10. Policyholders - Mutual (participating) co. - may pay dividends; Stockholders - Stock (non-participating) co. - no dividends.






11. Intentional deception; grounds for rescission.






12. Allows for use of HMO/PPO or other private carrier to provide expanded benefits @ additional premium & if enrolled in BOTH Parts A & B.






13. Although death benefit is tax-free - it is included in gross estate value so federal &/or state taxes may apply to a portion in excess of fixed federal limit.






14. Prepaid med. benefits for "subscribers" @ approved facilities; many non-profit; Blue Cross - Hospital stays; Blue Shield - M.D. costs.






15. Preferred or Preferred Smoker; Standard or Standard Smoker; Substandard; Denied.






16. 'The inability to perform your OWN normal occupation or daily duties'.






17. Financial interest in insured party that must exist @ time of application OR policy issuance. Requires consent (except minors).






18. Partially state-funded benefits for low-income people whereby cost of care is shared between state & recipient - based on income.






19. Insured can seek legal action against Insurer for denial of claim only after 60 days and up to 3 yrs. after providing proof of loss.






20. Accumulation or "pay-in" - contributions & interest earned are tax-deferred; Annuity or "pay-out" - monthly annuity (taxable) paid.






21. Govt. organization providing health care benefits for dependents of military personnel.






22. 1: parties to contract; 2: insured party or life; 3: insurable interest - if 3rd party; 4: risks insured against; 5: policy period (term); 6: premium & mode.






23. Coverage remains in effect for 31 days past premium due date; benefits paid during grace period would be deducted from sum.






24. Written contract to transfer risk of premature death from one party to another; pays stated sum upon death; creates instant estate.






25. 'The inability to perform ANY reasonable occupation based on education - training or experience'.






26. Two death benefit options - Option A: death benefit ONLY; Option B: death benefit + cash value; death benefit NOT guaranteed.






27. To "make whole again" w/out benefit or detriment; neither monetary profit nor loss.






28. Coverage for catastrophic loss w/ high limits - front end deductible; co-insurance (80/20%); blanket coverage; stop loss max.






29. Pre-existing illness/injury; Waiting period; Elimination period; Probationary period; Benefits - Exclusions - Limitations; Underwriting reqs.






30. Earned premium is $ paid for coverage to date. Unearned premium is $ paid & returnable due to coverage not provided.






31. Receipt whereby coverage incepts ONLY after underwriting approval.






32. Hybrid of HMO & PPO w/ greater flexibility on choosing specialists outside network w/ benefits still provided but @ higher co-pay.






33. No-charge annuity w/drawals allowed up to 10% of total - THEN penalized on sliding scale based on # policy yrs.; conditionally waived.






34. Potential circumstance that could cause a loss; measured in dollars.






35. Same as WL but w/ Level Term rider; upon death - pays monthly income for FULL term AFTER which pays full death benefit.






36. Allows policy owner to w/draw set % of death benefit upon verification of terminal illness w/ expectancy 12-24 mths.; generally tax-free.






37. WL policy covering 2 or more Insureds but payable upon death of FIRST Insured - after which policy ends.






38. Privately-provided or Medicare-provided (if no private carrier) prescription drug plans for qualified individuals but w/ premium - deductible & co-pay.






39. 1: Tax-free lump sum; 2: Monthly pay-outs for fixed time; 3: Fixed monthly payments until depleted.






40. Experience - rates impacted by actual prior claim experience of actual group; Community - identical rates used for entire community - regardless of experience.






41. Compensates business for loss due to death or disability of key employee; premiums not deductible but benefits tax-free.






42. Upon death - death benefit is paid + the aggregate of premiums paid to date; add-on to Term policy ONLY.






43. Provides increased death benefit if death occurs w/in 90 days & as result of accident; relatively INexpensive add-on.






44. Compensates business for loss due to disability of key employee; premiums not deductible but benefits tax-free.






45. Insurer has right to rescind policy & return premium if material misrepresentation in application is found w/in 1st 2 yrs.






46. Federally-funded but state-run program for truly indigent individuals & families providing medical care at Federal clinic.






47. Both Contributory & Non-contributory Group policies are deductible to employer (not employee) but benefits are taxable. Individual policy premium is NOT deductible but benefit is received tax-free.






48. Provides for continued operation of business if partner becomes disabled - by allowing other partner(s) to buy disabled partner's interest in business.






49. Combination of Basic Medical & Major Medical in one policy; Basic pays 1st - then Major Medical w/ corridor deductible.






50. Provides usual & customary business expenses (rent - utilities - salaries - mortgage) if owner becomes disabled; premiums deductible - benefits taxable.