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. Part A - Inpatient hospital deductibles vary on # of days; limited reserve days; finite benefit; 1st 3 pints blood; Part B - 20% co-payment.






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






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






4. 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.






5. Receipt whereby coverage incepts ONLY after underwriting approval.






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






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






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






9. No-charge annuity w/drawals allowed up to 10% of total - THEN penalized on sliding scale based on # policy yrs.; conditionally waived.






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






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






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






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






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






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






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






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






18. 1: Tax-free lump sum; 2: Monthly pay-outs for fixed time; 3: Fixed monthly payments until depleted.






19. Potential circumstance that could cause a loss; measured in dollars.






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






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






22. 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.






23. Policy covering minor child; premium fixed but death benefit increases by 5 times @ age 18 or 21.






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






25. Treating or mitigating loss exposures through 1: avoidance; 2: retention (deductibles); 3: sharing; 4: reduction; or 5: transfer.






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






27. 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.






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






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






30. Federal program financed by payroll taxes provided equally by both employer & employee OR entirely by individual (if self-employed). Provides benefits for: Medicare @ age 65+; retirement; $255 lump sum death benefit; (limited) disability; survivors;






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






32. Employer w/ 25 or less employees must offer all eligible employees @ least 2 medical plan options where pre-existing conditions can't be excluded more than 1 yr.






33. Tendency of poorer risks to seek insurance.






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






35. Insurer has right to adjust (+ or -) death benefit if age or sex is misstated but normally doesn't void policy.






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






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






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






39. 1: Surrender for cash value (taxable); 2: Buy equal-benefit paid-up Level Term policy; 3: Buy reduced-benefit paid-up WL policy.






40. Allows for use of HMO/PPO or other private carrier to provide expanded benefits @ additional premium & if enrolled in BOTH Parts A & B.






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






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






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






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






45. Specialized policy covering diagnostic & preventative dental care; often no deductible; co-insurance; expensive; may be included w/ medical plan.






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






47. Same as WL but cash value increases @ current interest rates (not set); premium can start low or high & may change.






48. Death benefit determined by Insured's financial goals & needs (minus assets).






49. Prepaid med. benefits for members ONLY w/ approved primary care M.D. (HMO employee); focus on preventative care; low co-pay.






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