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. Provides accidental death benefit @ full $ of "principal sum". Dismemberment is paid only @ 50% principal sum ("capital sum").






2. War - 2 types; Suicide (1st 2 yrs.); Aviation (non-commercial); Hazardous hobbies; Criminal acts; Alcohol/Drug influenced.






3. Policy owner has right to determine mode of premium payment but Insurer can charge admin. fee if not annual.






4. 1: Non-cancelable; 2: Guaranteed renewable; 3: Cancelable; 4: Conditionally renewable; 5: Optionally renewable.






5. Authorized (admitted) - can conduct business in state; Unauthorized (non-admitted) - cannot conduct business in state (w/ one exception).






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






7. 1: Cash (tax-free); 2: Apply to future premiums; 3: Retained by Insurer @ interest; 4: Buy Paid-up WL policy add-ons; 5: Pay-up existing policy; 6: Buy 1-yr. Term policy.






8. Generally 10 days after policy delivery to cancel policy w/ full refund - except 30 days for seniors or for replacement policies.






9. Fixed premium w/ guaranteed min. death benefit that may increase due to higher than expected investment returns.






10. Life license + NASD (FINRA) Series 6 or 7.






11. Employer w/ 25 or less employees must offer all eligible employees @ least 2 medical plan options where pre-existing conditions can't be excluded more than 1 yr.






12. Level - fixed death benefit - premium fixed until renewal; Decreasing - death benefit decreases over term - premium fixed until renewal; Increasing - death benefit increases over term - premium fixed until renewal.






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






14. Policy provisions must conform to state regulations where policy is sold.






15. Covers entire family w/ WL for breadwinner & (convertible) Level Term for spouse & children (until certain age).






16. Periodic return of premium to policy owners from Mutual (Par) Companies; not guaranteed & not taxable as income; may be used in 6 ways.






17. Waives premium upon disability of Insured until return to work; disability must persist for 90 days or longer; 1st 90 day premiums refunded after 90 days.






18. Same as WL but death benefit decreases each yr. w/ dividends paid annually to offset decrease.






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






20. Death benefit determined by Insured's projected lost earnings potential.






21. Application submitted w/out premium; no coverage until submission of full consideration & completed Statement of Continued Good Health.






22. 1: Skilled nursing care; 2: Intermediate care; 3: Custodial care; 4: Home health care.






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






24. Covers disabilities occurring ONLY "off" job; benefits do not overlap work. comp. (i.e. Group plan).






25. Same as Term Life but provides living benefit (endowment) to policy owner if Insured survives entire term.






26. Price of insurance per exposure unit.






27. Same as WL but premium low for 1st 5 yrs. - THEN has annual premium increases for set # yrs. - THEN level premium.






28. Time period preceding each disability during which benefits are not paid; longer elimination periods = cheaper premium.






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






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






31. Insurance purchased by other Insurer(s) to spread or diversify risk; promotes industry stability.






32. Identical to Incontestable Clause in Life policy.






33. Mortality is the statistical possibility of death @ each age. Morbidity is the statistical possibility & extent of disability @ each age.






34. Unintentional - up to $1 -000 + legal $; Intentional - $1 -000-5 -000 + legal $; If harmful - misdemeanor + up to 1 yr. prison + up to $10 -000.






35. Expands individual WL policy to include Term Life for dependents (spouse - children - etc.).






36. Benefits automatically increase annually based on inflationary index (i.e. Consumer Price Index) OR flat rate (5% max.).






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






38. 1: Single (lump sum) premium; 2: Periodic premiums - can be level (fixed $) OR flexible from mth. to mth. (w/ req. min.)






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






40. An unintentional mistake committed by an insurance representative; may be covered by E&O insurance.






41. PURELY employer-funded account to reimburse employees for qualified medical expenses not covered by group health plan.






42. Prepaid med. benefits for members w/ approved primary care M.D. (independent); low co-pay; non-PPO M.D. can be used at higher cost.






43. Palliative - treatment to manage pain; Curative - treatment to cure illness/condition.






44. Provides coverage for specific disease(s) - such as cancer or leukemia.






45. Federal program financed by payroll taxes provided equally by both employer & employee OR entirely by individual (if self-employed). Provides benefits for: Medicare @ age 65+; retirement; $255 lump sum death benefit; (limited) disability; survivors;






46. Peril is the CAUSE of loss. Hazard is a condition that increases LIKELIHOOD of loss.






47. Process which prevents claim denial as a result of false statement or promise (made by Insurer) - which was relied upon by Insured.






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






49. Upon death - death benefit is paid + the aggregate of cash value accumulated to date; add-on to WL policy ONLY.






50. Prohibited w/ regard to testing for people of same class; test results must remain confidential; coverage may be declined (once discovered).