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






2. Actual/Expressed - written powers; Implied - unwritten but customary practices; Apparent - perceived powers.






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






4. Policyholders - Mutual (participating) co. - may pay dividends; Stockholders - Stock (non-participating) co. - no dividends.






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






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






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






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






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






10. Death benefit is NOT taxable. Cash value grows tax-deferred but cost basis (base premium) is not taxable - only interest is.






11. 1: Surrender for cash value (taxable); 2: Buy equal-benefit paid-up Level Term policy; 3: Buy reduced-benefit paid-up WL policy.






12. A&H - A&S - Sickness only; Medical; Disability; Accident only; Travel accident; LTC; Medicare supplement; AD&D; Dental/Vision/Prescription; Limited.






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






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






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






16. 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.






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






18. 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.






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






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






21. Tendency of poorer risks to seek insurance.






22. 1: Fixed - guaranteed fixed monthly income & fixed interest rate; 2: Variable - unguaranteed; monthly income varies based on stocks/bond returns.






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






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






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






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






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






28. Conditional - coverage is conditional; Personal - parties are people; Good faith - honesty/integrity; Fiduciary - req's financial trust.






29. Receipt whereby coverage incepts conditionally upon submission of full consideration and that all underwriting reqs. are met.






30. 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.






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






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






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






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






35. IRS allows tax-free transfer of cash values between 2 LIKE policies (i.e. Life to Life - Annuity to Annuity - or Life to Annuity).






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






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






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






39. Grows @ fixed min. interest rate but w/ possible higher rate tied to equity index (i.e S&P Equity Index) appreciation; gains shared w/ Insurer.






40. Mandatory 100% employer-funded coverage for injuries/illnesses occurring "on" job; full-time employees only; exclusive remedy. Provides: 1: unlimited medical benefit; 2: survivor income replacement & funeral ($5 -000 max.); 3: disability benefit @ 66

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






42. Coverage remains in effect for 31 days past premium due date; benefits paid during grace period would be deducted from sum.






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






44. Domestic - within home state; Foreign - outside home state; Alien - outside home country.






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






46. Multiple small employers w/ common affiliation (trade assoc. OR Chamber of Commerce) band together to purchase group plan.






47. 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.






48. 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.






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






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






Can you answer 50 questions in 15 minutes?



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