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






2. The state in which the contract is accepted or delivered is the state that possesses regulatory jurisdiction over Group plan.






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






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






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






6. 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.






7. 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.






8. 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.






9. Death benefits & premium automatically increase annually based on inflationary index (i.e. Consumer Price Index).






10. Pure risk involves chance of loss ONLY (accident or misfortune). Speculative risk involves chance of loss OR gain (gambling - stock investment).






11. Disability policy rider covering "the inability to perform some - but not all of your duties"; pays max. 50% of disability benefit for up to 6 mths.






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






13. Excludes coverage for suicide during 1st 2 yrs. ONLY but - if it does - all premiums must be returned to beneficiary.






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






15. Policyholders - Mutual (participating) co. - may pay dividends; Stockholders - Stock (non-participating) co. - no dividends.






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






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






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






19. Reappearance of disability w/in 6 mth. period after "recovery" from same disability is considered recurrence - not new disability.






20. 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.






21. Same as WL but cash value put in investment vehicles chosen by policy owner (stocks - bonds - munis.); cash value NOT guaranteed.






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






23. 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.






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






25. Level - fixed death benefit - premium fixed until renewal; Decreasing - death benefit decreases over term - premium fixed until renewal; Increasing - death benefit increases over term - premium fixed until renewal.






26. Physical - slippery floor; Moral - dishonest acts; Morale - carelessness or recklessness.






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






28. 1: Skilled nursing care; 2: Intermediate care; 3: Custodial care; 4: Home health care.






29. Prohibited w/ regard to testing for people of same class; test results must remain confidential; coverage may be declined (once discovered).






30. Business continuation funding plan whereby each partner agrees to buy Life policies on each other - but not themselves.






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






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






33. 1: Individual; 2: Joint - multiple annuitants paid until 1st dies; 3: Joint & Survivor - multiple annuitants paid until 1st dies THEN survivors paid but @ reduced $.






34. Price of insurance per exposure unit.






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






36. Coverage remains in effect for 31 days past premium due date; benefits paid during grace period would be deducted from sum.






37. 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.






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






39. Pays death benefit until age 100 or death; builds equity (cash value); may be transferred or sold; generally level premium.






40. 1: Immediate benefits rec'd w/in 30 days but premium must be paid by lump sum; 2: Deferred - usually until retirement.






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






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






43. 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






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






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






46. If Insured & primary beneficiary die due to same act (w/in 14 days) - primary assumed 1st to die & contingent beneficiary paid death benefit.






47. No-cost provision that authorizes Insurer to borrow from cash value to pay unpaid premiums after grace period; must ask for @ app. time.






48. Expands individual WL policy to include Term Life for dependents (spouse - children - etc.).






49. Dividends are NOT taxable but interest is. Loan interest is NOT tax-deductible. Interest paid by Insurer on retained funds is taxable.






50. 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;