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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. Facultative - case by case agreements; Automatic/Treaty - automatic acceptance of risk percentage per previous agreement.
Non-forfeiture options for WL policy
Types of reinsurance
Annuity Classifications (5 of 5): # of lives
Endowment Life policy
2. Allows Insured to increase death benefit w/out medical exam (subject to age max.) w/ additional premium rate determined @ attained age.
Underwriting risk categories
Guaranteed Insurability Life rider
Survivorship (aka "Last to die") policy
Adverse selection
3. Monthly; Quarterly; Semi-annually; Annually (cheapest due to less admin cost).
Premium modes
Payment of Premium provision
Family or Dependents rider
Cash value
4. War; elective cosmetic surgery; routine dental; work. comp.-covered claims; self-inflicted (intentional); gov't. facility treatment; LTC; private nursing.
Key Employee policy
Exclusions for Major Medical plan
Common Disability Exclusions
Dividends
5. PURELY employer-funded account to reimburse employees for qualified medical expenses not covered by group health plan.
Business Continuation (aka Buy-Sell) Disability policy
Approval Type Conditional receipt
Health Reimbursement Account (HRA)
Medicaid/Medi-Cal
6. Prepaid med. benefits for members ONLY w/ approved primary care M.D. (HMO employee); focus on preventative care; low co-pay.
Endowment Life policy
Tax implications of Death Benefit & Cash Value
Dividend options
Health Maintenance Organization (HMO)
7. Revocable - changeable anytime w/ Change of Beneficiary Form; Irrevocable - not changeable w/out beneficiary permission.
Factors that determine premium
Types of Agency Authority
Revocable vs. Irrevocable beneficiary
24 Hour Coverage (CA)
8. A lapsed policy may be reinstated if not longer than 3-5 yrs. - & proof of insurability re-established - & back premiums + interest paid.
Reinstatement provision
Incontestability clause/provision
Workers' Compensation insurance
Doctrine of Comity
9. Govt. organization providing health care benefits for dependents of military personnel.
Rate (as defined by CIC)
Types of Accident & Health (A&H) providers
CHAMPUS (aka TriCare)
Payment of Premium provision
10. War/Military; Intentional self-inflicted; Aviation (non-commercial); Foreign country; Loss of professional license; Illegal activity; Mental disorders (after 1-2 yrs.).
Types of Insurers (by ownership)
Common Life Exclusions
Common Disability Exclusions
Non-forfeiture options for WL policy
11. Funding mechanism whereby employer & employee share cost of premium. Upon death - benefit is shared between employer & beneficiary.
Plans A-L of Medical Supplement or Medigap
Dread Disease policy
Spendthrift provision
Split Dollar Plan
12. Time period preceding each disability during which benefits are not paid; longer elimination periods = cheaper premium.
Experience vs. Community rating in Group Health plan
Elimination (aka Waiting) period
Indeterminate Premium Whole Life policy
Tax implications of an Annuity (1 of 2)
13. Domestic - within home state; Foreign - outside home state; Alien - outside home country.
Change of Occupation provision
Medicaid/Medi-Cal
Juvenile Life (aka Jumping Juvenile) policy
Types of Insurers (by domicile)
14. Grows @ fixed min. interest rate but w/ possible higher rate tied to equity index (i.e S&P Equity Index) appreciation; gains shared w/ Insurer.
Grace Period provision
Equity Indexed annuity
Annuity Classifications (2 of 5): When benefits begin
Non-forfeiture options for WL policy
15. Death benefits & premium automatically increase annually based on inflationary index (i.e. Consumer Price Index).
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
Equity Index Whole Life policy
Cost of Living Adjustment (COLA) Life rider
Types of Licensed Producers
16. No deductible coverage for: daily room/board; ancillary costs; surgeon &/or physician expense (for added premium).
Blue Cross/Blue Shield
Basic Medical plan
Split Dollar Plan
Exclusions for Major Medical plan
17. Receipt whereby coverage incepts immediately upon submission of full consideration - unless declined & premium refunded.
Errors & Omissions (E&O)
Return of Premium rider
Estoppel
Binding receipt (aka Temporary Insurance Agreement)
18. War - 2 types; Suicide (1st 2 yrs.); Aviation (non-commercial); Hazardous hobbies; Criminal acts; Alcohol/Drug influenced.
Permanent vs. Temporary disability
Common Life Exclusions
Equity Index Whole Life policy
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
19. An unintentional mistake committed by an insurance representative; may be covered by E&O insurance.
Business Overhead Expense (BOE) Disability policy
Errors & Omissions (E&O)
Exclusions for Major Medical plan
Types of Licensed Producers
20. Generally 10 days after policy delivery to cancel policy w/ full refund - except 30 days for seniors or for replacement policies.
Incontestability clause/provision
Earned vs. Unearned premium
Key Employee Disability policy
Free Look provision
21. Although death benefit is tax-free - it is included in gross estate value so federal &/or state taxes may apply to a portion in excess of fixed federal limit.
Dependent coverage
Guaranteed Insurability Life rider
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
Tax implications of an Estate
22. A company providing lump sum buyout (50-90% of total) of Life policy; becomes owner & beneficiary & assumes premium payments; usually terminally ill viator.
Medicare Part C (aka Medicare Advantage)
Tax implications of Dividends - Loans & Interest
Residual disability rider
Viatical Settlement Provider (VSP)
23. After 2-3 yrs. - Whole Life policy equity builds tax-deferred @ fixed interest rate until it equals death benefit; borrowable but taxable.
Payment of Premium provision
Cash value
Medicare Part B (aka Supplemental Medical Insurance or SMI)
Preferred Provider Organization (PPO)
24. Excludes coverage for suicide during 1st 2 yrs. ONLY but - if it does - all premiums must be returned to beneficiary.
Blue Cross/Blue Shield
Suicide clause/provision
Annuity Classifications (1 of 5): How premium is paid
Employer Liability
25. Provides for continued operation of business if partner dies - by allowing surviving partner(s) to buy deceased partner's interest in business.
Convertibility provision
Business Continuation (aka Buy-Sell) policy
Elimination (aka Waiting) period
Premium modes
26. Extreme form of Limited Pay Whole Life whereby entire premium is paid in a single payment.
Family Income policy
Family Maintenance policy
Single Pay Whole Life policy
Family policy
27. Voiding an insurance contract based on fraud - concealment or material misrepresentation; premiums returned; policy treated as never existing.
Supplemental Major Medical plan
Convertibility provision
Rescission
Loss exposure
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).
1035 Exchange
Exclusions to Work. Comp.
Palliative vs. Curative care
7 Pay Test
29. Life license + NASD (FINRA) Series 6 or 7.
Modified Endowment Contract (MEC)
Requirements to sell variable life products
Current Assumption (aka Interest-Sensitive) Whole Life policy
Annuity
30. Info already known; Info that should have been known; Waived info; Irrelevant info.
Indemnify
Concealment exceptions
Payor (aka Waiver of Payor's Premium) rider
Dental Plan
31. 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.
Long Term Care (LTC) policy
Applicant Representations vs. Warranties
Employer Liability
Convertibility provision
32. Covers entire family w/ WL for breadwinner & (convertible) Level Term for spouse & children (until certain age).
Equity Indexed annuity
Family policy
Modified Endowment Contract (MEC)
COBRA Time Limitations
33. 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.
Small Employer Medical Expense plan
Health Insurance Portability and Accountability Act (HIPAA)
Preferred Provider Organization (PPO)
Dividend options
34. Policy must be delivered w/ original (or copy of same) application attached.
Premium modes
Blackout Period
Entire Contract provision
Plans A-L of Medical Supplement or Medigap
35. Experience - rates impacted by actual prior claim experience of actual group; Community - identical rates used for entire community - regardless of experience.
Experience vs. Community rating in Group Health plan
Medical cost containment (aka Managed care)
Graded Premium Whole Life policy
Indeterminate Premium Whole Life policy
36. 4: Funds retained by Insurer until w/drawn - interest ONLY paid monthly (taxable); 5: Paid-up immediate annuity.
Primary Insurance Amount (PIA)
Settlement options for Life policy (2 of 2)
Rehabilitation rider
Medicare Supplement or Medigap policy
37. Period of time following any children's survivor benefit & before benefits are provided to employee's widow/widower.
Trial Application (aka Request for Offer)
Blackout Period
Enhanced Ordinary (aka Extraordinary) Whole Life policy
COBRA Time Limitations
38. Earned premium is $ paid for coverage to date. Unearned premium is $ paid & returnable due to coverage not provided.
Earned vs. Unearned premium
Key Employee policy
Policy delivery
Automatic Premium Loan (APL) provision
39. Intentional deception; grounds for rescission.
Fraud
Types of Term Life policies
Split Dollar Plan
Health Reimbursement Account (HRA)
40. Provides hospital insurance automatically @ age 65 (if FICA qualified) @ no fee but may have deductible & co-pay.
Types of hazards
Grace Period provision
Cost of Living Adjustment (COLA) Life rider
Medicare Part A (aka Hospital Insurance or HI)
41. Potential circumstance that could cause a loss; measured in dollars.
Relation of Earnings to Insurance provision
Loss exposure
Medicare Part A & B "Gaps"
Rescission
42. Unilateral - Insurer provides contract; Adhesion - parties must adhere to terms; Aleatory - benefits may not inure equally.
Departments of an Insurer
Total disability (as commonly defined)
Risk management
Insurance contract characteristics (1 of 2)
43. Prepaid med. benefits for "subscribers" @ approved facilities; many non-profit; Blue Cross - Hospital stays; Blue Shield - M.D. costs.
Blue Cross/Blue Shield
Supplemental Major Medical plan
Dividends
Non-forfeiture options for WL policy
44. Pays death benefit until age 100 or death; builds equity (cash value); may be transferred or sold; generally level premium.
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
Whole (aka Permanent or Straight) Life policy
Dread Disease policy
Grace Period provision
45. Actual/Expressed - written powers; Implied - unwritten but customary practices; Apparent - perceived powers.
Blackout Period
Single Pay Whole Life policy
Relation of Earnings to Insurance provision
Types of Agency Authority
46. Intentional OR unintentional failure to disclose material underwriting facts that should have been disclosed; grounds for policy rescission.
Occupational Disability policy
Loss of Earnings Test
Medicare Supplement or Medigap policy
Concealment
47. Savings account for medical expenses; Tax-deductible contributions; tax-deferred growth; tax-free for qualified use; taxable for non-qualified use.
Universal (aka Flexible Premium Adjustable) Life policy (3 of 4)
Medical Savings Account (MSA) & Health Savings Account (HSA)
Entire Contract provision
Permanent vs. Temporary disability
48. Same as Term Life but provides living benefit (endowment) to policy owner if Insured survives entire term.
Endowment Life policy
Point of Service plan
Loss exposure
AIDS/HIV discrimination
49. Permanent disability due to total loss of sight - hearing - speech or use of 2 + limbs; benefits paid even while continuing to work.
Presumptive disability
Tax implications of medical plans
Business Overhead Expense (BOE) Disability policy
Beneficiary provisions
50. Disability income is based on "earned income" (salary - bonus - commission) - not unearned income (interest - investment - rents).
Family or Dependents rider
Health Insurance Portability and Accountability Act (HIPAA)
Insurability Type Conditional receipt
Loss of Earnings Test