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






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






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






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






5. Temp. coverage for set duration w/ death benefit ONLY (no cash value) - offers largest $ for lowest premium; renewable; convertible.






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






7. Palliative - treatment to manage pain; Curative - treatment to cure illness/condition.






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






9. Taxable income (unlike individual plans); can be either short-term - 13-52 wks. max. or long-term - longer than 52 wks.






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






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






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






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






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






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






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






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






18. Written contract that provides INCOME @ high interest rate for fixed period OR for annuitant's lifetime w/ possible death benefit.






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






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






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






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






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






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






25. Revocable - changeable anytime w/ Change of Beneficiary Form; Irrevocable - not changeable w/out beneficiary permission.






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






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






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






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






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






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






32. Upon death - death benefit is paid + the aggregate of premiums paid to date; add-on to Term policy ONLY.






33. Representation - oral or written statement made to best of knowledge or belief; Warranty - statement guaranteed/presumed/understood to be true.






34. 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.






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






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






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






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






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






40. Same as WL but w/ Decreasing Term rider; upon death - pays monthly income for REMAINING term AFTER which pays full death benefit.






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






42. To "make whole again" w/out benefit or detriment; neither monetary profit nor loss.






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






44. Allows policy owner to w/draw set % of death benefit upon verification of terminal illness w/ expectancy 12-24 mths.; generally tax-free.






45. Same as WL but policy owner can adjust death benefit w/ corresponding premium adjustments; mostly obsolete.






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






47. 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.






48. Excludes coverage for specific injury/illness either temporarily or permanently in order to eliminate pre-existing condition.






49. Provides usual & customary business expenses (rent - utilities - salaries - mortgage) if owner becomes disabled; premiums deductible - benefits taxable.






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







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