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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. Temp. coverage for set duration w/ death benefit ONLY (no cash value) - offers largest $ for lowest premium; renewable; convertible.






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






3. 1: mortality probability charge; 2: Insurer's investment return; 3: expenses (admin costs - commissions). 1 - 2 = net; 1 - 2 + 3 = gross.






4. A lapsed policy may be reinstated if not longer than 3-5 yrs. - & proof of insurability re-established - & back premiums + interest paid.






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






6. Federal law which prohibits companies w/ 20+ employees from denying work & medical benefits to employees due to age.






7. 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.






8. War; elective cosmetic surgery; routine dental; work. comp.-covered claims; self-inflicted (intentional); gov't. facility treatment; LTC; private nursing.






9. Benefits automatically increase annually based on inflationary index (i.e. Consumer Price Index) OR flat rate (5% max.).






10. 1: Single (lump sum) premium; 2: Periodic premiums - can be level (fixed $) OR flexible from mth. to mth. (w/ req. min.)






11. Type of partial disability rider - which pays fluctuating % of lost income w/out time limit.






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






13. Mathematical calculation based on overall FICA contributions used to determine retirement/disability/survivorship benefit.






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






15. Process whereby a reinsurer reinsures w/ another reinsurer.






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






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






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






19. Death benefit is NOT taxable. Cash value grows tax-deferred but cost basis (base premium) is not taxable - only interest is.






20. Same as Comprehensive Major Medical but w/ integrated deductible; much more expensive.






21. 1: Non-cancelable; 2: Guaranteed renewable; 3: Cancelable; 4: Conditionally renewable; 5: Optionally renewable.






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






23. Non-qualified Annuity - Non-deductible contributions & tax-deferred growth. At pay-out - tax-free principal but taxable growth.






24. An attempt to contain costs by employing various strategies - including wellness programs - preventative testing - outpatient & alternative procedures.






25. Allows Insured to increase benefit w/out medical exam (subject to age max.) w/ additional premium rate determined @ attained age; must prove income increase.






26. Term Life policy w/ decreasing death benefit; usually used to secure credit (loan) w/ lender as beneficiary & borrower as Insured.






27. Provides for continued operation of business if partner dies - by allowing surviving partner(s) to buy deceased partner's interest in business.






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






29. 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.






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






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






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






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






34. Coverage for catastrophic loss w/ high limits - front end deductible; co-insurance (80/20%); blanket coverage; stop loss max.






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






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






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






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






39. Facultative - case by case agreements; Automatic/Treaty - automatic acceptance of risk percentage per previous agreement.






40. Mandatory 100% employer-funded coverage for injuries/illnesses occurring "on" job; full-time employees only; exclusive remedy. Provides: 1: unlimited medical benefit; 2: survivor income replacement & funeral ($5 -000 max.); 3: disability benefit @ 66

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






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






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






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






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






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






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






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






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






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







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