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






2. Annuity distributions prior to age 59 1/2 incur a 10% IRS penalty EXCEPT for death - disability - immediate annuity - or rollover.






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






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






5. A&H - A&S - Sickness only; Medical; Disability; Accident only; Travel accident; LTC; Medicare supplement; AD&D; Dental/Vision/Prescription; Limited.






6. Beneficiary has right to leave death benefits / Insurer to protect $ from creditors; interest (taxable) paid on retained funds.






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






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






9. Same as WL but cash value increases @ current interest rates (not set); premium can start low or high & may change.






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






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






12. Provides supplemental coverage for physician/surgeon fees if enrolled (during enrollment period ONLY) & pay monthly premium w/ deductible and co-insurance.






13. 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.






14. Receipt whereby coverage incepts immediately upon submission of full consideration - unless declined & premium refunded.






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






16. Covers disabilities occurring both "on" AND "off" job; "on" job benefits paid in addition to work. comp. - if applicable (i.e. individual plan).






17. 1: Single (lump sum) premium; 2: Periodic premiums - can be level (fixed $) OR flexible from mth. to mth. (w/ req. min.)






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






19. Intentional deception; grounds for rescission.






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






21. Waives premium upon disability of Insured until return to work; disability must persist for 6 mths. or longer. Cash value & dividends not affected.






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






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






24. 4: Funds retained by Insurer until w/drawn - interest ONLY paid monthly (taxable); 5: Paid-up immediate annuity.






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






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






27. Permanent - not recoverable (spinal cord injury); Temporary - recoverable (temp. illness/injury - broken limb).






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






29. Mortality is the statistical possibility of death @ each age. Morbidity is the statistical possibility & extent of disability @ each age.






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






31. Provides disability income during surgery recovery from life-threatening condition (& sometimes cosmetic surgery).






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






33. Waives premium on Life policy for minor child until age 21 in event premium payor dies or becomes disabled.

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






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






36. Written contract that provides INCOME @ high interest rate for fixed period OR for annuitant's lifetime w/ possible death benefit.






37. 1: Tax-free lump sum; 2: Monthly pay-outs for fixed time; 3: Fixed monthly payments until depleted.






38. 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.






39. Identical to Incontestable Clause in Life policy.






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






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






42. If Insured changes to: more hazardous job - benefits reduced; less hazardous job - premiums reduce.






43. Refund of 50-80% of premium (minus claims paid) every 5-10 yrs. OR age 65; expensive!






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






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






46. 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.






47. Extreme form of Limited Pay Whole Life whereby entire premium is paid in a single payment.






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






49. 1: Non-cancelable; 2: Guaranteed renewable; 3: Cancelable; 4: Conditionally renewable; 5: Optionally renewable.






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