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Test your basic knowledge |
CA Life Agent Exam
Start Test
Study First
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. Partially state-funded benefits for low-income people whereby cost of care is shared between state & recipient - based on income.
Permanent vs. Temporary disability
Medi-Cal Share Cost plan
Trusts
Insurability Type Conditional receipt
2. If Insured & primary beneficiary die due to same act (w/in 14 days) - primary assumed 1st to die & contingent beneficiary paid death benefit.
Considerations in replacing Health insurance
Recurrent disability clause/provision
Common Disaster (Simultaneous Death Act) clause/provision
Types of Medical Plans
3. Prevents overinsuring in order to profit from disability by coordinating benefits between Insurers.
Relation of Earnings to Insurance provision
Settlement options for Life policy (2 of 2)
Group Disability plan
Medicare Part A (aka Hospital Insurance or HI)
4. Provides benefit during Social Security "black-out" period - up to 1 yr.
Rate (as defined by CIC)
Relation of Earnings to Insurance provision
Social Security Benefit (Supplement) rider
Revocable vs. Irrevocable beneficiary
5. Policy owner has right to determine mode of premium payment but Insurer can charge admin. fee if not annual.
Insurability Type Conditional receipt
Payment of Premium provision
Age Discrimination in Employment Act (ADEA)
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
6. Same as WL but can be "paid-up" early by paying larger premium for shorter payment period (i.e. 10 Pay Life - 20 Pay Life).
Dividends
Premium modes
Family Maintenance policy
Limited Pay Whole Life policy
7. 'The inability to perform your OWN normal occupation or daily duties'.
Permanent vs. Temporary disability
Total disability (as commonly defined)
Business Continuation (aka Buy-Sell) policy
Medicare
8. If total premiums paid w/in 1st 7 yrs. exceed net level premium that should have been paid - policy is an MEC.
Types of Insurers (miscellaneous)
7 Pay Test
Workers' Compensation insurance
Consolidated Omnibus Budget Reconciliation Act (COBRA)
9. No-cost provision that authorizes Insurer to borrow from cash value to pay unpaid premiums after grace period; must ask for @ app. time.
Employee Retirement Income Security Act (ERISA)
Social Security (aka Old Age Survivors Disability Health Insurance or OASDHI)
Dread Disease policy
Automatic Premium Loan (APL) provision
10. Process which prevents claim denial as a result of false statement or promise (made by Insurer) - which was relied upon by Insured.
Beneficiary provisions
Total disability (as commonly defined)
Estoppel
Loss exposure
11. Death benefit determined by Insured's projected lost earnings potential.
Phases of an annuity
Experience vs. Community rating in Group Health plan
Human Life Value approach
Insurance contract characteristics (2 of 2)
12. A lapsed policy may be reinstated if not longer than 3-5 yrs. - & proof of insurability re-established - & back premiums + interest paid.
Indeterminate Premium Whole Life policy
Reinstatement provision
Single Pay Whole Life policy
Health Insurance Portability and Accountability Act (HIPAA)
13. Receipt whereby coverage incepts ONLY after underwriting approval.
Approval Type Conditional receipt
Key Employee policy
Applicant Representations vs. Warranties
Types of Agency Authority
14. Actual/Expressed - written powers; Implied - unwritten but customary practices; Apparent - perceived powers.
7 Pay Test
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
Medicare Part B (aka Supplemental Medical Insurance or SMI)
Types of Agency Authority
15. WL policy covering 2 or more Insureds but payable upon death of FIRST Insured - after which policy ends.
Peril vs. Hazard
Joint Life (aka "First to die") policy
Payment of Premium provision
Convertibility provision
16. 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.
Health Insurance Portability and Accountability Act (HIPAA)
Health Reimbursement Account (HRA)
AIDS/HIV discrimination
Total disability (more restrictive definition)
17. Combination of Basic Medical & Major Medical in one policy; Basic pays 1st - then Major Medical w/ corridor deductible.
Accidental Death (aka Multiple Indemnity) rider
Comprehensive Major Medical plan
Annuity Classifications (3 of 5): Source of income
CA Work. Comp. Statutes
18. Same as WL but w/ Decreasing Term rider; upon death - pays monthly income for REMAINING term AFTER which pays full death benefit.
Doctrine of Comity
Family Income policy
Dividend options
Common Disaster (Simultaneous Death Act) clause/provision
19. Dividends are NOT taxable but interest is. Loan interest is NOT tax-deductible. Interest paid by Insurer on retained funds is taxable.
Endowment Life policy
Current Assumption (aka Interest-Sensitive) Whole Life policy
Tax implications of Dividends - Loans & Interest
Return of Cash Value rider
20. Summary of coverage including premium & mode of payment - death benefit - beneficiary(ies) - exclusions - & promise to pay.
Insuring clause/provision (aka Insuring Agreement)
Single Pay Whole Life policy
Settlement options for Life policy (1 of 2)
Major Medical plan
21. Conditional - coverage is conditional; Personal - parties are people; Good faith - honesty/integrity; Fiduciary - req's financial trust.
Trial Application (aka Request for Offer)
Types of hazards
Insurance contract characteristics (2 of 2)
Permanent vs. Temporary disability
22. Part of IRS Section 125 cafeteria plan - which allows pre-tax payroll deductions for qualified medical expenses or child/dependent care.
Flexible Spending Account (FSA)
Family Income policy
Medi-Cal Share Cost plan
Dread Disease policy
23. Benefits automatically increase annually based on inflationary index (i.e. Consumer Price Index) OR flat rate (5% max.).
Cost of Living Adjustment (COLA) Disability rider
Viatical Settlement Provider (VSP)
Group Disability plan
Automatic Premium Loan (APL) provision
24. Available for any reason up to full cash value @ fixed (max 8%) OR variable interest rate; loan $ + interest deducted from benefit @ death.
Policy loans
Pure risk vs. Speculative risk
Key Employee Disability policy
CA Work. Comp. Statutes
25. Permanent disability due to total loss of sight - hearing - speech or use of 2 + limbs; benefits paid even while continuing to work.
Presumptive disability
Estoppel
Insuring clause/provision (aka Insuring Agreement)
Experience vs. Community rating in Group Health plan
26. Covers disabilities occurring ONLY "off" job; benefits do not overlap work. comp. (i.e. Group plan).
Non-Occupational Disability policy
Revocable vs. Irrevocable beneficiary
Common Life Exclusions
Beneficiary provisions
27. 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.
Small Employer Medical Expense plan
Suicide clause/provision
CHAMPUS (aka TriCare)
Medicare Supplement or Medigap policy
28. Info already known; Info that should have been known; Waived info; Irrelevant info.
Considerations in replacing Health insurance
Concealment exceptions
AIDS/HIV discrimination
Preferred Provider Organization (PPO)
29. Federal law which prohibits companies w/ 15+ employees from decreasing coverage benefits for women affected by pregnancy or childbirth.
Civil Rights/Pregnancy Discrimination Act
Types of Term Life policies
Modified Premium Whole Life policy
Cost of Living Adjustment (COLA) Disability rider
30. Qualified Annuity - Tax-deductible contributions & tax-deferred growth but fully taxable w/drawals.
Types of reinsurance
Basic Medical plan
Tax implications of an Annuity (1 of 2)
Accidental Death & Dismemberment (AD&D) Disability rider
31. Mathematical law stating the larger # of occurrences - the more predictable the losses; used to calculate premiums.
Estoppel
Law of Large Numbers
Earned vs. Unearned premium
Return of Premium rider
32. Federally-funded but state-run program for truly indigent individuals & families providing medical care at Federal clinic.
Medi-Cal Share Cost plan
Return of Premium rider
Insurer (as defined by CIC)
Medicaid/Medi-Cal
33. 1: Fixed - guaranteed fixed monthly income & fixed interest rate; 2: Variable - unguaranteed; monthly income varies based on stocks/bond returns.
IRS Penalties for Annuities
Annuity Classifications (3 of 5): Source of income
Disability Income policy
Family Maintenance policy
34. 1: Cash (tax-free); 2: Apply to future premiums; 3: Retained by Insurer @ interest; 4: Buy Paid-up WL policy add-ons; 5: Pay-up existing policy; 6: Buy 1-yr. Term policy.
Cash value
Adverse selection
Time Limit on Certain Defenses provision
Dividend options
35. Intentional OR unintentional failure to disclose material underwriting facts that should have been disclosed; grounds for policy rescission.
Concealment
Dental Plan
Total disability (more restrictive definition)
Health Insurance Portability and Accountability Act (HIPAA)
36. No-charge annuity w/drawals allowed up to 10% of total - THEN penalized on sliding scale based on # policy yrs.; conditionally waived.
Medicare Part A (aka Hospital Insurance or HI)
Annuity surrender charges
Factors that determine premium
Concealment
37. 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.
Fraud
Long Term Care (LTC) policy
Health Maintenance Organization (HMO)
Total disability (more restrictive definition)
38. Unintentional - up to $1 -000 + legal $; Intentional - $1 -000-5 -000 + legal $; If harmful - misdemeanor + up to 1 yr. prison + up to $10 -000.
Single Pay Whole Life policy
Revocable vs. Irrevocable beneficiary
Penalties for violating AIDS/HIV privacy laws
Requirements to sell variable life products
39. 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.
Time Limit on Certain Defenses provision
Medical Savings Account (MSA) & Health Savings Account (HSA)
Pure risk vs. Speculative risk
Medicare
40. Basic Medical; Major Medical; Comprehensive Major Medical
Dividends
Types of Medical Plans
Group Disability plan
Types of Term Life policies
41. 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.
Types of Insurers (by ownership)
Types of Insurers (by domicile)
Pure risk vs. Speculative risk
COBRA Time Limitations
42. Beneficiary has right to leave death benefits / Insurer to protect $ from creditors; interest (taxable) paid on retained funds.
Non-Occupational Disability policy
Social Security (aka Old Age Survivors Disability Health Insurance or OASDHI)
Endowment Life policy
Spendthrift provision
43. Fixed premium w/ guaranteed min. death benefit that may increase due to higher than expected investment returns.
Medicare Part A & B "Gaps"
Variable Life policy (2 of 2)
Annuity Classifications (2 of 5): When benefits begin
CHAMPUS (aka TriCare)
44. 1: Non-cancelable; 2: Guaranteed renewable; 3: Cancelable; 4: Conditionally renewable; 5: Optionally renewable.
Medicaid/Medi-Cal
Types of Term Life policies
Types of Renewability provisions
Waiver of Premium provision
45. Palliative - treatment to manage pain; Curative - treatment to cure illness/condition.
Limited Pay Whole Life policy
Palliative vs. Curative care
Misstatement of Age/Sex provision
Civil Rights/Pregnancy Discrimination Act
46. A company providing lump sum buyout (50-90% of total) of Life policy; becomes owner & beneficiary & assumes premium payments; usually terminally ill viator.
Types of Licensed Producers
Plans A-L of Medical Supplement or Medigap
Disability Income policy
Viatical Settlement Provider (VSP)
47. Waives premium upon disability of Insured until return to work; disability must persist for 6 mths. or longer. Cash value & dividends not affected.
Plans A-L of Medical Supplement or Medigap
Renewability provision
Fraud
Waiver of Premium (Waiver of Cost of Insurance) rider
48. 4: Funds retained by Insurer until w/drawn - interest ONLY paid monthly (taxable); 5: Paid-up immediate annuity.
7 Pay Test
Types of Insurers (by ownership)
Types of Accident & Health insurance
Settlement options for Life policy (2 of 2)
49. Provides 24 hr. health coverage both "on" & "off" job - but may cause coverage duplication & coordination challenges.
Annuity Classifications (3 of 5): Source of income
Indeterminate Premium Whole Life policy
Requirements to sell variable life products
24 Hour Coverage (CA)
50. 1: Surrender for cash value (taxable); 2: Buy equal-benefit paid-up Level Term policy; 3: Buy reduced-benefit paid-up WL policy.
Non-forfeiture options for WL policy
Civil Rights/Pregnancy Discrimination Act
Spendthrift provision
Palliative vs. Curative care