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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. Beneficiary has right to leave death benefits / Insurer to protect $ from creditors; interest (taxable) paid on retained funds.






2. Any person - assoc. - org. - partnership - business trust - LLC - or corp. capable of making an insurance contract.






3. Policy must be delivered w/ original (or copy of same) application attached.






4. Grows @ fixed interest rate for set term but cash value may adjust to prevailing rate (+ or -) if fully surrendered before term ends; % w/drawal ok.






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






6. Part of IRS Section 125 cafeteria plan - which allows pre-tax payroll deductions for qualified medical expenses or child/dependent care.






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






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






9. Same as WL but death benefit increases annually - linked to Consumer Price Index; premium increases annually OR is set high from start.






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






11. Process which prevents claim denial as a result of false statement or promise (made by Insurer) - which was relied upon by Insured.






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






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






14. Provides coverage for specific disease(s) - such as cancer or leukemia.






15. 1: Fixed - guaranteed fixed monthly income & fixed interest rate; 2: Variable - unguaranteed; monthly income varies based on stocks/bond returns.






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






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






18. Policy owner has 90 days from date of loss to submit proof of loss to Insurer; valid claim must be paid immediately upon receipt.






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






20. Govt. organization providing health care benefits for dependents of military personnel.






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






22. 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.






23. 1: Single (lump sum) premium; 2: Periodic premiums - can be level (fixed $) OR flexible from mth. to mth. (w/ req. min.)






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






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






26. 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.






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






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






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






30. 1: Individual; 2: Joint - multiple annuitants paid until 1st dies; 3: Joint & Survivor - multiple annuitants paid until 1st dies THEN survivors paid but @ reduced $.






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






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






33. Federally-funded but state-run program for truly indigent individuals & families providing medical care at Federal clinic.






34. An unintentional mistake committed by an insurance representative; may be covered by E&O insurance.






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






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






37. Experience - rates impacted by actual prior claim experience of actual group; Community - identical rates used for entire community - regardless of experience.






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






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






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






41. Private sector (Commercial) - provides LA&H - P&C - & LTC; Public sector (Gov't) - provides flood - work. comp. - Medicare/Medicaid - Group Life (SGLI/FEGLI).






42. 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.






43. 1: mortality probability charge; 2: Insurer's investment return; 3: expenses (admin costs - commissions). 1 - 2 = net; 1 - 2 + 3 = gross.






44. Reappearance of disability w/in 6 mth. period after "recovery" from same disability is considered recurrence - not new disability.






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






46. 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.






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






48. Provides for continued operation of business if partner dies - by allowing surviving partner(s) to buy deceased partner's interest in business.






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






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






Can you answer 50 questions in 15 minutes?



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