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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. Fraternal - non-profit - members only; Reciprocal - unincorp'd org. - members insure each other; Lloyd's Assoc. - groups sharing risks; Surplus lines - special market risks.






2. Basic Medical; Major Medical; Comprehensive Major Medical






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






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






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






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






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






8. 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.






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






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






11. 1: Single (lump sum) premium; 2: Periodic premiums - can be level (fixed $) OR flexible from mth. to mth. (w/ req. min.)






12. Earned premium is $ paid for coverage to date. Unearned premium is $ paid & returnable due to coverage not provided.






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






14. Provides for continued operation of business if partner becomes disabled - by allowing other partner(s) to buy disabled partner's interest in business.






15. 'The inability to perform ANY gainful occupation'.






16. Federally-funded but state-run program for truly indigent individuals & families providing medical care at Federal clinic.






17. Partially state-funded benefits for low-income people whereby cost of care is shared between state & recipient - based on income.






18. IRS allows tax-free transfer of cash values between 2 LIKE policies (i.e. Life to Life - Annuity to Annuity - or Life to Annuity).






19. Allows for Term policy renewal @ higher premium w/out medical exam; guarantees insurability; based on actual/attained age.






20. Part of IRS Section 125 cafeteria plan - which allows pre-tax payroll deductions for qualified medical expenses or child/dependent care.






21. Authorized (admitted) - can conduct business in state; Unauthorized (non-admitted) - cannot conduct business in state (w/ one exception).






22. Policy owner must notify Insurer of loss either in writing - in person or by phone w/in 20 days.






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






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






25. Plan A is the CORE benefit & is least expensive; All other plans include Plan A + additional benefits. Plans F & J are high deductible. K & L are both deductible & co-pay plans.






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






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






28. 1: Tax-free lump sum; 2: Monthly pay-outs for fixed time; 3: Fixed monthly payments until depleted.






29. Dependent children are covered until 19 or 23 (full-time student only) or until self-sufficient (if handicapped).






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






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






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






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






34. 1: Surrender for cash value (taxable); 2: Buy equal-benefit paid-up Level Term policy; 3: Buy reduced-benefit paid-up WL policy.






35. No deductible coverage for: daily room/board; ancillary costs; surgeon &/or physician expense (for added premium).






36. Premiums determined by target cash values or death benefit; partial cash value w/drawals allowed; transparent policy w/ unbundled premium.






37. Allows Insured to increase death benefit w/out medical exam (subject to age max.) w/ additional premium rate determined @ attained age.






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






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






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






41. 1: Non-cancelable; 2: Guaranteed renewable; 3: Cancelable; 4: Conditionally renewable; 5: Optionally renewable.






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






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






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






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






46. If total premiums paid w/in 1st 7 yrs. exceed net level premium that should have been paid - policy is an MEC.






47. Provides benefit during Social Security "black-out" period - up to 1 yr.






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






49. 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.






50. Responsible adult trustee designated to manage death benefits for minor child beneficiary until adulthood.







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