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Test your basic knowledge |
CA Life Agent Exam
Start Test
Study First
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. Type of partial disability rider - which pays fluctuating % of lost income w/out time limit.
Annuity Classifications (2 of 5): When benefits begin
Residual disability rider
Types of reinsurance
Key Employee Disability policy
2. Actual/Expressed - written powers; Implied - unwritten but customary practices; Apparent - perceived powers.
Experience vs. Community rating in Group Health plan
Types of Agency Authority
Permanent vs. Temporary disability
Tax implications of Dividends - Loans & Interest
3. Financial interest in insured party that must exist @ time of application OR policy issuance. Requires consent (except minors).
Premium modes
Transplant/Cosmetic Surgery rider
Insurable interest
Accidental Death & Dismemberment (AD&D) Life policy
4. Fraternal - non-profit - members only; Reciprocal - unincorp'd org. - members insure each other; Lloyd's Assoc. - groups sharing risks; Surplus lines - special market risks.
Errors & Omissions (E&O)
Social Security (aka Old Age Survivors Disability Health Insurance or OASDHI)
Palliative vs. Curative care
Types of Insurers (miscellaneous)
5. Policy owner must notify Insurer of loss either in writing - in person or by phone w/in 20 days.
Factors that determine premium
Medicare Part A (aka Hospital Insurance or HI)
Return of Cash Value rider
Notice of Claim provision
6. War/Military; Intentional self-inflicted; Aviation (non-commercial); Foreign country; Loss of professional license; Illegal activity; Mental disorders (after 1-2 yrs.).
Suicide clause/provision
Common Disability Exclusions
Rate (as defined by CIC)
Trusts
7. Commercial (private) companies; HMOs; PPOs; Blue Cross/Blue Shield; Employer-sponsored plans; Government.
Common Disability Exclusions
Business Continuation (aka Buy-Sell) Disability policy
Suicide clause/provision
Types of Accident & Health (A&H) providers
8. Federal law which prohibits companies w/ 15+ employees from decreasing coverage benefits for women affected by pregnancy or childbirth.
Partial disability rider
Civil Rights/Pregnancy Discrimination Act
Medicare Part C (aka Medicare Advantage)
Business Continuation (aka Buy-Sell) Disability policy
9. Non-qualified Annuity - Non-deductible contributions & tax-deferred growth. At pay-out - tax-free principal but taxable growth.
Tax implications of an Annuity (1 of 2)
Waiver of Premium (Waiver of Cost of Insurance) rider
Common Disability Exclusions
Annuity Classifications (2 of 5): When benefits begin
10. Identical to Incontestable Clause in Life policy.
Whole (aka Permanent or Straight) Life policy
Key Employee policy
Time Limit on Certain Defenses provision
Social Security Benefit (Supplement) rider
11. Any person - assoc. - org. - partnership - business trust - LLC - or corp. capable of making an insurance contract.
Insurer (as defined by CIC)
Preferred Provider Organization (PPO)
Long Term Care (LTC) policy
Juvenile Life (aka Jumping Juvenile) policy
12. Underwriting - determines insurability; Marketing/Sales - determines products; Actuarial - determines rates; Claims - investigates/pays claims.
Term Life policy
Return of Cash Value rider
Departments of an Insurer
Accidental Death (aka Multiple Indemnity) rider
13. 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.
Consolidated Omnibus Budget Reconciliation Act (COBRA)
Applicant Representations vs. Warranties
Split Dollar Plan
Common Disability Exclusions
14. Allows policy owner to w/draw set % of death benefit upon verification of terminal illness w/ expectancy 12-24 mths.; generally tax-free.
Loss exposure
Partial disability rider
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
Presumptive disability
15. Earned premium is $ paid for coverage to date. Unearned premium is $ paid & returnable due to coverage not provided.
Recurrent disability clause/provision
Earned vs. Unearned premium
Small Employer Medical Expense plan
Non-Occupational Disability policy
16. Preferred or Preferred Smoker; Standard or Standard Smoker; Substandard; Denied.
Underwriting risk categories
Tax implications of Dividends - Loans & Interest
Exclusions to Work. Comp.
Permanent vs. Temporary disability
17. Permanent disability due to total loss of sight - hearing - speech or use of 2 + limbs; benefits paid even while continuing to work.
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
Employee Retirement Income Security Act (ERISA)
Graded Premium Whole Life policy
Presumptive disability
18. Upon death - death benefit is paid + the aggregate of premiums paid to date; add-on to Term policy ONLY.
Types of Licensed Producers
Concealment
Return of Premium rider
Annuity surrender charges
19. Fixed premium w/ guaranteed min. death benefit that may increase due to higher than expected investment returns.
Law of Large Numbers
Palliative vs. Curative care
Variable Life policy (2 of 2)
Cost of Living Adjustment (COLA) Disability rider
20. If total premiums paid w/in 1st 7 yrs. exceed net level premium that should have been paid - policy is an MEC.
7 Pay Test
Non-forfeiture options for WL policy
Convertibility provision
Annuity Classifications (2 of 5): When benefits begin
21. 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.
Valid life insurance contracts must identify...
Small Employer Medical Expense plan
Credit Life policy
Rate (as defined by CIC)
22. Upon notice - Insurer must provide Claim Form (Proof of Loss Form) to Insured w/in 15 days.
Accidental Death & Dismemberment (AD&D) Life policy
Life insurance policy
Cost of Living Adjustment (COLA) Disability rider
Claim Form (aka Proof of Loss Form) provision
23. Allows Term policy conversion to Permanent policy w/out medical exam; must be identical or lower death benefit; based on either attained OR original age.
Universal (aka Flexible Premium Adjustable) Life policy (3 of 4)
Convertibility provision
Types of Licensed Producers
IRS Penalties for Annuities
24. War; elective cosmetic surgery; routine dental; work. comp.-covered claims; self-inflicted (intentional); gov't. facility treatment; LTC; private nursing.
Long Term Care (LTC) policy
Exclusions for Major Medical plan
Tax implications of an Estate
Law of Large Numbers
25. Federal law which prohibits companies w/ 20+ employees from denying work & medical benefits to employees due to age.
Age Discrimination in Employment Act (ADEA)
Loss of Earnings Test
1035 Exchange
Cost of Living Adjustment (COLA) Disability rider
26. Covers disabilities occurring ONLY "off" job; benefits do not overlap work. comp. (i.e. Group plan).
Medicare Part B (aka Supplemental Medical Insurance or SMI)
Non-Occupational Disability policy
Permanent vs. Temporary disability
Mortality vs. Morbidity tables
27. If 2 or more family members are injured in the same accident - only payment of a single deductible is required.
Parole Pardon Rule
Estoppel
Common Accident provision
Reinsurance
28. Federally-funded but state-run program for truly indigent individuals & families providing medical care at Federal clinic.
Medicaid/Medi-Cal
Spendthrift provision
Impairment (Exclusion) rider
Dividend options
29. Domestic - within home state; Foreign - outside home state; Alien - outside home country.
Types of Insurers (by domicile)
Time Limit on Certain Defenses provision
Types of Insurers (miscellaneous)
Workers' Compensation insurance
30. After 2-3 yrs. - Whole Life policy equity builds tax-deferred @ fixed interest rate until it equals death benefit; borrowable but taxable.
Types of Renewability provisions
Factors that determine premium
Tax implications of Disability policy
Cash value
31. Mathematical calculation based on overall FICA contributions used to determine retirement/disability/survivorship benefit.
Tax implications of medical plans
Types of Insurers (by domicile)
Primary Insurance Amount (PIA)
CHAMPUS (aka TriCare)
32. Same as WL but w/ Level Term rider; upon death - pays monthly income for FULL term AFTER which pays full death benefit.
Concealment
Family Maintenance policy
Long Term Care (LTC) policy
Basic Medical plan
33. Allows Insured to increase benefit w/out medical exam (subject to age max.) w/ additional premium rate determined @ attained age; must prove income increase.
Graded Premium Whole Life policy
Exclusions to Work. Comp.
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
Medical Savings Account (MSA) & Health Savings Account (HSA)
34. Agreement - Offer & acceptance; Consideration - application + premium; Legal capacity - licensed &/or competent; Legal purpose - public good.
Types of Insurers (by ownership)
Key Employee policy
Elements to contract
Notice of Claim provision
35. Compensates business for loss due to death or disability of key employee; premiums not deductible but benefits tax-free.
Key Employee policy
Types of Agency Authority
Medicare Part D
Family Income policy
36. No-cost provision that authorizes Insurer to borrow from cash value to pay unpaid premiums after grace period; must ask for @ app. time.
Automatic Premium Loan (APL) provision
Comprehensive Major Medical plan
Return of Premium rider
Group Disability plan
37. Same as WL but cash value put in investment vehicles chosen by policy owner (stocks - bonds - munis.); cash value NOT guaranteed.
Variable Life policy (1 of 2)
Workers' Compensation insurance
Peril vs. Hazard
Revocable vs. Irrevocable beneficiary
38. PURELY employer-funded account to reimburse employees for qualified medical expenses not covered by group health plan.
Accidental Death & Dismemberment (AD&D) Disability rider
Health Reimbursement Account (HRA)
Civil Rights/Pregnancy Discrimination Act
Types of Medical Plans
39. An irrevocable IRS classification of a policy (determined by the 7 Pay Test) whereby tax advantages are lost for all distributions ONLY.
Waiver of Premium (Waiver of Cost of Insurance) rider
Modified Endowment Contract (MEC)
Civil Rights/Pregnancy Discrimination Act
Insurance contract characteristics (1 of 2)
40. Prepaid med. benefits for "subscribers" @ approved facilities; many non-profit; Blue Cross - Hospital stays; Blue Shield - M.D. costs.
Blue Cross/Blue Shield
Disability Income policy
Life insurance policy
Settlement options for Life policy (1 of 2)
41. 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.
Variable Life policy (2 of 2)
Dividend options
Considerations in replacing Health insurance
Valid life insurance contracts must identify...
42. Prohibited w/ regard to testing for people of same class; test results must remain confidential; coverage may be declined (once discovered).
Total disability (more restrictive definition)
AIDS/HIV discrimination
Annuity Classifications (1 of 5): How premium is paid
Legal Action provision
43. Beneficiary has right to leave death benefits / Insurer to protect $ from creditors; interest (taxable) paid on retained funds.
Incontestability clause/provision
Spendthrift provision
Annuity Classifications (5 of 5): # of lives
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
44. 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.
Limited Pay Whole Life policy
Retrocession
Beneficiary provisions
Health Reimbursement Account (HRA)
45. Life license + NASD (FINRA) Series 6 or 7.
Notice of Claim provision
Requirements to sell variable life products
Social Security Benefit (Supplement) rider
Beneficiary provisions
46. Privately-sold policies to provide benefits not covered by Medicare; divided into 12 plans listed alphabetically A - L; 30-day free look; guaranteed renewable.
Medicare Supplement or Medigap policy
Enhanced Ordinary (aka Extraordinary) Whole Life policy
Social Security (aka Old Age Survivors Disability Health Insurance or OASDHI)
Medicare Part D
47. Tendency of poorer risks to seek insurance.
Adverse selection
Errors & Omissions (E&O)
Business Continuation (aka Buy-Sell) policy
Annuity
48. Taxable income (unlike individual plans); can be either short-term - 13-52 wks. max. or long-term - longer than 52 wks.
Comprehensive Major Medical plan
Group Disability plan
Risk management
Types of Insurers (by authorization)
49. Same as WL but w/ adjustable death benefit (& corresponding premium) & over-fund option but w/ annually renewable term (ART).
Medicaid/Medi-Cal
Levels of Long Term Care provided
Types of Insurers (by sector)
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
50. Price of insurance per exposure unit.
Annuity
Suicide clause/provision
Legal Action provision
Rate (as defined by CIC)