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. Business continuation funding plan whereby each partner agrees to buy Life policies on each other - but not themselves.






2. Provides medical & personal services for people needing extended assistance w/ Activities of Daily Living (ADL). Other benefits include: assisted living care; respite care; hospice care; adult day care.






3. 4: Funds retained by Insurer until w/drawn - interest ONLY paid monthly (taxable); 5: Paid-up immediate annuity.






4. 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.






5. 1: Skilled nursing care; 2: Intermediate care; 3: Custodial care; 4: Home health care.






6. Same as WL but death benefit increases annually - linked to Consumer Price Index; premium increases annually OR is set high from start.






7. 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.






8. 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.






9. Process whereby a reinsurer reinsures w/ another reinsurer.






10. Written policy terms supersede oral statements made prior to policy issue.






11. Primary - if 2 or more - equally shared; Contingent (Secondary) - only if primary dead; Tertiary - only if both primary & secondary dead. If none listed - goes to estate.






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






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






14. Provides hospital insurance automatically @ age 65 (if FICA qualified) @ no fee but may have deductible & co-pay.






15. Federal law which allows health coverage portability when changing jobs - so long as previous coverage was in effect 63+ days; allows some tax deductibility for LTC.






16. Policy covering minor child; premium fixed but death benefit increases by 5 times @ age 18 or 21.






17. 1: Single (lump sum) premium; 2: Periodic premiums - can be level (fixed $) OR flexible from mth. to mth. (w/ req. min.)






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






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






20. An irrevocable IRS classification of a policy (determined by the 7 Pay Test) whereby tax advantages are lost for all distributions ONLY.






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






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






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






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






25. 'The inability to perform ANY gainful occupation'.






26. Federal law to protect Federal employees' (& their beneficiaries') pension - group insurance - & welfare benefits.






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






28. Same as WL but premium low for 1st 3-5 yrs. - THEN has one-time premium increase.






29. Policy owner has 90 days from date of loss to submit proof of loss to Insurer; valid claim must be paid immediately upon receipt.






30. Same as WL but policy owner can adjust death benefit w/ corresponding premium adjustments; mostly obsolete.






31. Price of insurance per exposure unit.






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






33. If 2 or more family members are injured in the same accident - only payment of a single deductible is required.






34. Specialized policy covering diagnostic & preventative dental care; often no deductible; co-insurance; expensive; may be included w/ medical plan.






35. Insurer has right to adjust (+ or -) death benefit if age or sex is misstated but normally doesn't void policy.






36. Any person - assoc. - org. - partnership - business trust - LLC - or corp. capable of making an insurance contract.






37. Provides 24 hr. health coverage both "on" & "off" job - but may cause coverage duplication & coordination challenges.






38. Underwriting - determines insurability; Marketing/Sales - determines products; Actuarial - determines rates; Claims - investigates/pays claims.






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






40. Non-qualified Annuity - Non-deductible contributions & tax-deferred growth. At pay-out - tax-free principal but taxable growth.






41. Monthly; Quarterly; Semi-annually; Annually (cheapest due to less admin cost).






42. Benefits NOT taxable; employer-paid premiums deductible to employer; individual plans not deductible unless over 7 1/2% of adjusted gross income - then excess deductible.






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






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






45. Excludes coverage for specific injury/illness either temporarily or permanently in order to eliminate pre-existing condition.






46. Excludes coverage for suicide during 1st 2 yrs. ONLY but - if it does - all premiums must be returned to beneficiary.






47. Summary of coverage including premium & mode of payment - death benefit - beneficiary(ies) - exclusions - & promise to pay.






48. Provides professional services - rehabilitation - training/re-training & related costs to assist Insured in returning to work.






49. Same as WL but w/ adjustable death benefit (& corresponding premium) & over-fund option but w/ annually renewable term (ART).






50. Agents - represent Insurer; Brokers - represent themselves & Insured; Solicitors - represent one agent to solicit leads.