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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. Upon notice - Insurer must provide Claim Form (Proof of Loss Form) to Insured w/in 15 days.






2. Waives premium on Life policy for minor child until age 21 in event premium payor dies or becomes disabled.

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3. Unilateral - Insurer provides contract; Adhesion - parties must adhere to terms; Aleatory - benefits may not inure equally.






4. Guaranteed min. interest rate on cash value buildup but possible higher rate if short-term investment returns higher than expected.






5. Fraternal - non-profit - members only; Reciprocal - unincorp'd org. - members insure each other; Lloyd's Assoc. - groups sharing risks; Surplus lines - special market risks.






6. Same as Term Life but provides living benefit (endowment) to policy owner if Insured survives entire term.






7. Federal law which allows health coverage portability when changing jobs - so long as previous coverage was in effect 63+ days; allows some tax deductibility for LTC.






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






9. Agreement - Offer & acceptance; Consideration - application + premium; Legal capacity - licensed &/or competent; Legal purpose - public good.






10. Group plan initially self-funded by employer (like SIR); after which - group plan Insurer covers (up to policy limit); requires TPA.






11. 1: mortality probability charge; 2: Insurer's investment return; 3: expenses (admin costs - commissions). 1 - 2 = net; 1 - 2 + 3 = gross.






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






13. Must be delivered in person or by certified - registered or 1st-class mail w/ signature - unless waived by Insurance Commissioner.






14. Commercial (private) companies; HMOs; PPOs; Blue Cross/Blue Shield; Employer-sponsored plans; Government.






15. 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.






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






17. Combination of Basic Medical & Major Medical in one policy; Basic pays 1st - then Major Medical w/ corridor deductible.






18. After 2-3 yrs. - Whole Life policy equity builds tax-deferred @ fixed interest rate until it equals death benefit; borrowable but taxable.






19. 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






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






21. 'The inability to perform ANY gainful occupation'.






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






23. Policy owner must notify Insurer of loss either in writing - in person or by phone w/in 20 days.






24. Premiums determined by target cash values or death benefit; partial cash value w/drawals allowed; transparent policy w/ unbundled premium.






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






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






27. Life license + NASD (FINRA) Series 6 or 7.






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






29. Authorized (admitted) - can conduct business in state; Unauthorized (non-admitted) - cannot conduct business in state (w/ one exception).






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






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






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






33. Monthly; Quarterly; Semi-annually; Annually (cheapest due to less admin cost).






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






35. 1: Non-cancelable; 2: Guaranteed renewable; 3: Cancelable; 4: Conditionally renewable; 5: Optionally renewable.






36. 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.






37. Prepaid med. benefits for "subscribers" @ approved facilities; many non-profit; Blue Cross - Hospital stays; Blue Shield - M.D. costs.






38. Tendency of poorer risks to seek insurance.






39. Policy provisions must conform to state regulations where policy is sold.






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






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






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






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






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






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






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. Provides increased death benefit if death occurs w/in 90 days & as result of accident; relatively INexpensive add-on.






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






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






50. Accumulation or "pay-in" - contributions & interest earned are tax-deferred; Annuity or "pay-out" - monthly annuity (taxable) paid.







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