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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. Voiding an insurance contract based on fraud - concealment or material misrepresentation; premiums returned; policy treated as never existing.






2. Must be delivered in person or by certified - registered or 1st-class mail w/ signature - unless waived by Insurance Commissioner.






3. Policy owner must notify Insurer of loss either in writing - in person or by phone w/in 20 days.






4. Same as WL but can be "paid-up" early by paying larger premium for shorter payment period (i.e. 10 Pay Life - 20 Pay Life).






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






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






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






8. If Insured changes to: more hazardous job - benefits reduced; less hazardous job - premiums reduce.






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






10. 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.






11. 1: Immediate benefits rec'd w/in 30 days but premium must be paid by lump sum; 2: Deferred - usually until retirement.






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






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






14. 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.






15. 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.






16. 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.






17. Time extension of benefits based on "qualifying" event. 18 mth. extension if laid off or fired; 36 mth. extension if death - divorce or child leaves home.






18. 1: Non-cancelable; 2: Guaranteed renewable; 3: Cancelable; 4: Conditionally renewable; 5: Optionally renewable.






19. Federal law which prohibits companies w/ 15+ employees from decreasing coverage benefits for women affected by pregnancy or childbirth.






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






21. Savings account for medical expenses; Tax-deductible contributions; tax-deferred growth; tax-free for qualified use; taxable for non-qualified use.






22. Covers disabilities occurring both "on" AND "off" job; "on" job benefits paid in addition to work. comp. - if applicable (i.e. individual plan).






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






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






25. 1: Fixed - guaranteed fixed monthly income & fixed interest rate; 2: Variable - unguaranteed; monthly income varies based on stocks/bond returns.






26. 1: Surrender for cash value (taxable); 2: Buy equal-benefit paid-up Level Term policy; 3: Buy reduced-benefit paid-up WL policy.






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






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






29. Same as WL but w/ Decreasing Term rider; upon death - pays monthly income for REMAINING term AFTER which pays full death benefit.






30. Same as WL but cash value increases @ current interest rates (not set); premium can start low or high & may change.






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






32. Intentional OR unintentional failure to disclose material underwriting facts that should have been disclosed; grounds for policy rescission.






33. Federal law which prohibits companies w/ 20+ employees from denying work & medical benefits to employees due to age.






34. 1: Req. - unless self-employed; 2: 7-day wait for disability benefits; 3: Premium based on ex-mod; 4: Rates approved by CDI; 5: to sell - must satisfy education reqs.






35. Available for any reason up to full cash value @ fixed (max 8%) OR variable interest rate; loan $ + interest deducted from benefit @ death.






36. Req. by CA statute & may provide workers coverage for action-over claims.






37. Death benefit determined by Insured's financial goals & needs (minus assets).






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






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






40. Dividends are NOT taxable but interest is. Loan interest is NOT tax-deductible. Interest paid by Insurer on retained funds is taxable.






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






42. 1: Skilled nursing care; 2: Intermediate care; 3: Custodial care; 4: Home health care.






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






44. Same as Comprehensive Major Medical but w/ integrated deductible; much more expensive.






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






46. Waives premium upon disability of Insured until return to work; disability must persist for 6 mths. or longer. Cash value & dividends not affected.






47. Mathematical calculation based on overall FICA contributions used to determine retirement/disability/survivorship benefit.






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






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






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







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