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






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






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






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






5. Term Life policy w/ decreasing death benefit; usually used to secure credit (loan) w/ lender as beneficiary & borrower as Insured.






6. Allows for Term policy renewal @ higher premium w/out medical exam; guarantees insurability; based on actual/attained age.






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






8. 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).






9. Privately-sold policies to provide benefits not covered by Medicare; divided into 12 plans listed alphabetically A - L; 30-day free look; guaranteed renewable.






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






11. Disability income is based on "earned income" (salary - bonus - commission) - not unearned income (interest - investment - rents).






12. Death benefits & premium automatically increase annually based on inflationary index (i.e. Consumer Price Index).






13. Receipt whereby coverage incepts immediately upon submission of full consideration - unless declined & premium refunded.






14. Basic Medical; Major Medical; Comprehensive Major Medical






15. A lapsed policy may be reinstated if not longer than 3-5 yrs. - & proof of insurability re-established - & back premiums + interest paid.






16. Prevents overinsuring in order to profit from disability by coordinating benefits between Insurers.






17. Refund of 50-80% of premium (minus claims paid) every 5-10 yrs. OR age 65; expensive!






18. Facultative - case by case agreements; Automatic/Treaty - automatic acceptance of risk percentage per previous agreement.






19. WL policy covering 2 or more Insureds but ONLY payable upon death of LAST Insured - generally low premium but high death benefit.






20. Funding mechanism whereby employer & employee share cost of premium. Upon death - benefit is shared between employer & beneficiary.






21. War; elective cosmetic surgery; routine dental; work. comp.-covered claims; self-inflicted (intentional); gov't. facility treatment; LTC; private nursing.






22. Responsible adult trustee designated to manage death benefits for minor child beneficiary until adulthood.






23. 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.






24. Allows Insured to increase benefit w/out medical exam (subject to age max.) w/ additional premium rate determined @ attained age; must prove income increase.






25. 1: Non-cancelable; 2: Guaranteed renewable; 3: Cancelable; 4: Conditionally renewable; 5: Optionally renewable.






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






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






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






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






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






31. 1: Straight aka Pure Life - lifetime income but no survivorship refund; 2: Life w/ Period Certain - lifetime income w/ death benefit of monthly annuity for remaining predetermined term. 3: Annuity Certain - monthly income paid for predetermined term






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






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






34. 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.






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






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






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






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






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






40. War/Military; Intentional self-inflicted; Aviation (non-commercial); Foreign country; Loss of professional license; Illegal activity; Mental disorders (after 1-2 yrs.).






41. If total premiums paid w/in 1st 7 yrs. exceed net level premium that should have been paid - policy is an MEC.






42. 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.






43. No coverage for injuries while: 1: @ voluntary social event; 2: self-inflicted (intentional); 3: under alcohol/drug influence; 4: committing criminal act; 5: aggressor in workplace fight; 6: participating in athletic event (non-pro. athletes) 7: par






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






45. Temp. coverage for set duration w/ death benefit ONLY (no cash value) - offers largest $ for lowest premium; renewable; convertible.






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. Plan A is the CORE benefit & is least expensive; All other plans include Plan A + additional benefits. Plans F & J are high deductible. K & L are both deductible & co-pay plans.






48. Extreme form of Limited Pay Whole Life whereby entire premium is paid in a single payment.






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






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