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






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






3. Generally 10 days after policy delivery to cancel policy w/ full refund - except 30 days for seniors or for replacement policies.






4. Both Contributory & Non-contributory Group policies are deductible to employer (not employee) but benefits are taxable. Individual policy premium is NOT deductible but benefit is received tax-free.






5. 1: Skilled nursing care; 2: Intermediate care; 3: Custodial care; 4: Home health care.






6. Covers disabilities occurring ONLY "off" job; benefits do not overlap work. comp. (i.e. Group plan).






7. Provides % of monthly income benefit if Insured becomes disabled due to illness or accident.






8. Provides 24 hr. health coverage both "on" & "off" job - but may cause coverage duplication & coordination challenges.






9. Same as WL but premium low for 1st 3-5 yrs. - THEN has one-time premium increase.






10. Written contract to transfer risk of premature death from one party to another; pays stated sum upon death; creates instant estate.






11. Hybrid of HMO & PPO w/ greater flexibility on choosing specialists outside network w/ benefits still provided but @ higher co-pay.






12. Life license + NASD (FINRA) Series 6 or 7.






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






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






15. 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.






16. 1: Single (lump sum) premium; 2: Periodic premiums - can be level (fixed $) OR flexible from mth. to mth. (w/ req. min.)






17. Allows for use of HMO/PPO or other private carrier to provide expanded benefits @ additional premium & if enrolled in BOTH Parts A & B.






18. WL policy covering 2 or more Insureds but payable upon death of FIRST Insured - after which policy ends.






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






20. Benefits NOT taxable; employer-paid premiums deductible to employer; individual plans not deductible unless over 7 1/2% of adjusted gross income - then excess deductible.






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






22. Privately-provided or Medicare-provided (if no private carrier) prescription drug plans for qualified individuals but w/ premium - deductible & co-pay.






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






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






25. A company providing lump sum buyout (50-90% of total) of Life policy; becomes owner & beneficiary & assumes premium payments; usually terminally ill viator.






26. Treating or mitigating loss exposures through 1: avoidance; 2: retention (deductibles); 3: sharing; 4: reduction; or 5: transfer.






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






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






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






30. 'The inability to perform ANY reasonable occupation based on education - training or experience'.






31. Provides accidental death benefit @ full $ of "principal sum". Dismemberment is paid only @ 50% principal sum ("capital sum").






32. Prepaid med. benefits for "subscribers" @ approved facilities; many non-profit; Blue Cross - Hospital stays; Blue Shield - M.D. costs.






33. Summary of coverage including premium & mode of payment - death benefit - beneficiary(ies) - exclusions - & promise to pay.






34. Funding mechanism whereby employer & employee share cost of premium. Upon death - benefit is shared between employer & beneficiary.






35. Intentional deception; grounds for rescission.






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






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






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






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






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






41. Provides accidental death benefit @ full $ of "principal sum". Dismemberment is paid only @ 50% principal sum ("capital sum").






42. Insurer has right to rescind policy & return premium if material misrepresentation in application is found w/in 1st 2 yrs.






43. Grows @ fixed interest rate for set term but cash value may adjust to prevailing rate (+ or -) if fully surrendered before term ends; % w/drawal ok.






44. Price of insurance per exposure unit.






45. Peril is the CAUSE of loss. Hazard is a condition that increases LIKELIHOOD of loss.






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






47. Must be delivered in person or by certified - registered or 1st-class mail w/ signature - unless waived by Insurance Commissioner.






48. Private sector (Commercial) - provides LA&H - P&C - & LTC; Public sector (Gov't) - provides flood - work. comp. - Medicare/Medicaid - Group Life (SGLI/FEGLI).






49. Qualified Annuity - Tax-deductible contributions & tax-deferred growth but fully taxable w/drawals.






50. Policy provisions must conform to state regulations where policy is sold.