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. Permanent - not recoverable (spinal cord injury); Temporary - recoverable (temp. illness/injury - broken limb).






2. 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.






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






4. 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.






5. Same as Universal Life but cash value put in investment vehicles chosen by policy owner (stocks - bonds - munis.); cash value NOT guaranteed.






6. Info already known; Info that should have been known; Waived info; Irrelevant info.






7. Waives premium upon disability of Insured until return to work; disability must persist for 90 days or longer; 1st 90 day premiums refunded after 90 days.






8. Federally-sponsored health care for individuals 65+ &/or w/ certain disabilities; may run concurrent w/ group plan but group plan would act primary - THEN Medicare.






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






10. Insurer has right to rescind policy & return premium if material misrepresentation in application is found w/in 1st 2 yrs.






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






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






13. 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.






14. Provides disability income during surgery recovery from life-threatening condition (& sometimes cosmetic surgery).






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






16. Dependent children are covered until 19 or 23 (full-time student only) or until self-sufficient (if handicapped).






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






18. Hybrid of HMO & PPO w/ greater flexibility on choosing specialists outside network w/ benefits still provided but @ higher co-pay.






19. Same as WL but cash value put in investment vehicles chosen by policy owner (stocks - bonds - munis.); cash value NOT guaranteed.






20. Annuity distributions prior to age 59 1/2 incur a 10% IRS penalty EXCEPT for death - disability - immediate annuity - or rollover.






21. Earned premium is $ paid for coverage to date. Unearned premium is $ paid & returnable due to coverage not provided.






22. Same as WL but w/ Level Term rider; upon death - pays monthly income for FULL term AFTER which pays full death benefit.






23. Type of partial disability rider - which pays fluctuating % of lost income w/out time limit.






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






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






26. Receipt whereby coverage incepts ONLY after underwriting approval.






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






28. No-cost provision that authorizes Insurer to borrow from cash value to pay unpaid premiums after grace period; must ask for @ app. time.






29. 4: Funds retained by Insurer until w/drawn - interest ONLY paid monthly (taxable); 5: Paid-up immediate annuity.






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






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






32. Provides benefit during Social Security "black-out" period - up to 1 yr.






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






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






35. 1: Fixed - guaranteed fixed monthly income & fixed interest rate; 2: Variable - unguaranteed; monthly income varies based on stocks/bond returns.






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






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






38. Pure risk involves chance of loss ONLY (accident or misfortune). Speculative risk involves chance of loss OR gain (gambling - stock investment).






39. Level - fixed death benefit - premium fixed until renewal; Decreasing - death benefit decreases over term - premium fixed until renewal; Increasing - death benefit increases over term - premium fixed until renewal.






40. Coverage for catastrophic loss w/ high limits - front end deductible; co-insurance (80/20%); blanket coverage; stop loss max.






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






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






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






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






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






46. Tendency of poorer risks to seek insurance.






47. Physical - slippery floor; Moral - dishonest acts; Morale - carelessness or recklessness.






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






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






50. Policy owner has right to determine mode of premium payment but Insurer can charge admin. fee if not annual.