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. Prevents overinsuring in order to profit from disability by coordinating benefits between Insurers.






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






3. 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.






4. 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.






5. 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.






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






7. Intentional deception; grounds for rescission.






8. Written policy terms supersede oral statements made prior to policy issue.






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






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






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






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






13. 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.






14. Policy owner has 90 days from date of loss to submit proof of loss to Insurer; valid claim must be paid immediately upon receipt.






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






16. After 2-3 yrs. - Whole Life policy equity builds tax-deferred @ fixed interest rate until it equals death benefit; borrowable but taxable.






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






18. Palliative - treatment to manage pain; Curative - treatment to cure illness/condition.






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






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






21. War/Military; Intentional self-inflicted; Aviation (non-commercial); Foreign country; Loss of professional license; Illegal activity; Mental disorders (after 1-2 yrs.).






22. Identical to Incontestable Clause in Life policy.






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






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






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






26. 1: Req. - unless self-employed; 2: 7-day wait for disability benefits; 3: Premium based on ex-mod; 4: Rates approved by CDI; 5: to sell - must satisfy education reqs.






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






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






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






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






31. Guaranteed min. interest rate on cash value buildup but possible higher rate if short-term investment returns higher than expected.






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






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






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






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






36. Same as Term Life but provides living benefit (endowment) to policy owner if Insured survives entire term.






37. Receipt whereby coverage incepts ONLY after underwriting approval.






38. Same as WL but can be "paid-up" early by paying larger premium for shorter payment period (i.e. 10 Pay Life - 20 Pay Life).






39. Provides medical & personal services for people needing extended assistance w/ Activities of Daily Living (ADL). Other benefits include: assisted living care; respite care; hospice care; adult day care.






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






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






42. 1: Non-cancelable; 2: Guaranteed renewable; 3: Cancelable; 4: Conditionally renewable; 5: Optionally renewable.






43. Mathematical law stating the larger # of occurrences - the more predictable the losses; used to calculate premiums.






44. 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.






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






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






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






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






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






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