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Test your basic knowledge |
CA Life Agent Exam
Start Test
Study First
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. Two death benefit options - Option A: death benefit ONLY; Option B: death benefit + cash value; death benefit NOT guaranteed.
Universal (aka Flexible Premium Adjustable) Life policy (4 of 4)
Total disability (any-occupational definition)
Entire Contract provision
Split Dollar Plan
2. PURELY employer-funded account to reimburse employees for qualified medical expenses not covered by group health plan.
Health Reimbursement Account (HRA)
Workers' Compensation insurance
Exclusions to Work. Comp.
Term Life policy
3. If 2 or more family members are injured in the same accident - only payment of a single deductible is required.
Survivorship (aka "Last to die") policy
Dividend options
Common Accident provision
COBRA Time Limitations
4. Fixed premium w/ guaranteed min. death benefit that may increase due to higher than expected investment returns.
Policy delivery
Variable Life policy (2 of 2)
CA Work. Comp. Statutes
Types of Agency Authority
5. Agreement - Offer & acceptance; Consideration - application + premium; Legal capacity - licensed &/or competent; Legal purpose - public good.
Insurable interest
Non-Occupational Disability policy
Small Employer Medical Expense plan
Elements to contract
6. Provides coverage for specific disease(s) - such as cancer or leukemia.
Insurability Type Conditional receipt
Dread Disease policy
Medicaid/Medi-Cal
Medicare Part D
7. Policy owner has 90 days from date of loss to submit proof of loss to Insurer; valid claim must be paid immediately upon receipt.
Common Disaster (Simultaneous Death Act) clause/provision
Relation of Earnings to Insurance provision
Proof of Loss provision
Trial Application (aka Request for Offer)
8. Dividends are NOT taxable but interest is. Loan interest is NOT tax-deductible. Interest paid by Insurer on retained funds is taxable.
Tax implications of Dividends - Loans & Interest
Medi-Cal Share Cost plan
Age Discrimination in Employment Act (ADEA)
Tax implications of an Annuity (1 of 2)
9. Temp. coverage for set duration w/ death benefit ONLY (no cash value) - offers largest $ for lowest premium; renewable; convertible.
Reinstatement provision
Health Insurance Portability and Accountability Act (HIPAA)
Settlement options for Life policy (1 of 2)
Term Life policy
10. IRS allows tax-free transfer of cash values between 2 LIKE policies (i.e. Life to Life - Annuity to Annuity - or Life to Annuity).
Doctrine of Comity
Family or Dependents rider
Plans A-L of Medical Supplement or Medigap
1035 Exchange
11. Written contract that provides INCOME @ high interest rate for fixed period OR for annuitant's lifetime w/ possible death benefit.
Types of Insurers (by sector)
Annuity
AIDS/HIV discrimination
Variable Life policy (2 of 2)
12. Responsible adult trustee designated to manage death benefits for minor child beneficiary until adulthood.
Trusts
Employer Liability
Tax implications of medical plans
Universal (aka Flexible Premium Adjustable) Life policy (4 of 4)
13. Policy owner has right to determine mode of premium payment but Insurer can charge admin. fee if not annual.
Viatical Settlement Provider (VSP)
Concealment
Revocable vs. Irrevocable beneficiary
Payment of Premium provision
14. 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.
Long Term Care (LTC) policy
Exclusions to Work. Comp.
Types of reinsurance
Types of Licensed Producers
15. Facultative - case by case agreements; Automatic/Treaty - automatic acceptance of risk percentage per previous agreement.
Types of reinsurance
Basic Medical plan
Approval Type Conditional receipt
Annuity
16. Insured can seek legal action against Insurer for denial of claim only after 60 days and up to 3 yrs. after providing proof of loss.
Legal Action provision
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
AIDS/HIV discrimination
Business Overhead Expense (BOE) Disability policy
17. Any person - assoc. - org. - partnership - business trust - LLC - or corp. capable of making an insurance contract.
Insurance contract characteristics (2 of 2)
Premium modes
Insurer (as defined by CIC)
Rehabilitation rider
18. Same as WL but policy owner can adjust death benefit w/ corresponding premium adjustments; mostly obsolete.
Basic Medical plan
Adjustable Whole Life policy
Risk management
Family or Dependents rider
19. Qualified Annuity - Tax-deductible contributions & tax-deferred growth but fully taxable w/drawals.
Universal (aka Flexible Premium Adjustable) Life policy (4 of 4)
Modified Endowment Contract (MEC)
Concealment
Tax implications of an Annuity (1 of 2)
20. Commercial (private) companies; HMOs; PPOs; Blue Cross/Blue Shield; Employer-sponsored plans; Government.
Types of Accident & Health (A&H) providers
Types of reinsurance
Factors that determine premium
Juvenile Life (aka Jumping Juvenile) policy
21. 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).
Types of Insurers (by ownership)
Limited Pay Whole Life policy
Annuity Classifications (5 of 5): # of lives
Departments of an Insurer
22. 1: Fixed - guaranteed fixed monthly income & fixed interest rate; 2: Variable - unguaranteed; monthly income varies based on stocks/bond returns.
24 Hour Coverage (CA)
Primary Insurance Amount (PIA)
Employee Retirement Income Security Act (ERISA)
Annuity Classifications (3 of 5): Source of income
23. 1: Straight aka Pure Life - lifetime income but no survivorship refund; 2: Life w/ Period Certain - lifetime income w/ death benefit of monthly annuity for remaining predetermined term. 3: Annuity Certain - monthly income paid for predetermined term
Total disability (more restrictive definition)
Considerations in replacing Health insurance
Equity Indexed annuity
Annuity Classifications (4 of 5): Disposition "pay-out" of proceeds
24. Death benefits & premium automatically increase annually based on inflationary index (i.e. Consumer Price Index).
Cost of Living Adjustment (COLA) Life rider
Cross Purchase Plan
Errors & Omissions (E&O)
Types of Insurers (by ownership)
25. Agents - represent Insurer; Brokers - represent themselves & Insured; Solicitors - represent one agent to solicit leads.
Universal (aka Flexible Premium Adjustable) Life policy (4 of 4)
Common Life Exclusions
Types of Licensed Producers
Insurance contract characteristics (1 of 2)
26. WL policy covering 2 or more Insureds but ONLY payable upon death of LAST Insured - generally low premium but high death benefit.
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
Survivorship (aka "Last to die") policy
Endowment Life policy
Types of Renewability provisions
27. Savings account for medical expenses; Tax-deductible contributions; tax-deferred growth; tax-free for qualified use; taxable for non-qualified use.
Types of Insurers (by authorization)
Medical Savings Account (MSA) & Health Savings Account (HSA)
Blue Cross/Blue Shield
Business Overhead Expense (BOE) Disability policy
28. Upon death - death benefit is paid + the aggregate of premiums paid to date; add-on to Term policy ONLY.
1035 Exchange
Annuity Classifications (3 of 5): Source of income
Insurance contract characteristics (1 of 2)
Return of Premium rider
29. Group plan initially self-funded by employer (like SIR); after which - group plan Insurer covers (up to policy limit); requires TPA.
Types of hazards
Insurable interest
Employer-Administered plan
Health Reimbursement Account (HRA)
30. 1: Immediate benefits rec'd w/in 30 days but premium must be paid by lump sum; 2: Deferred - usually until retirement.
Pure risk vs. Speculative risk
Annuity Classifications (2 of 5): When benefits begin
Permanent vs. Temporary disability
Family Income policy
31. No coverage for injuries while: 1: @ voluntary social event; 2: self-inflicted (intentional); 3: under alcohol/drug influence; 4: committing criminal act; 5: aggressor in workplace fight; 6: participating in athletic event (non-pro. athletes) 7: par
Workers' Compensation insurance
Exclusions to Work. Comp.
Adverse selection
Types of Accident & Health (A&H) providers
32. 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.
Civil Rights/Pregnancy Discrimination Act
Consolidated Omnibus Budget Reconciliation Act (COBRA)
Market Value Adjusted (aka Modified Guaranteed) annuity
Considerations in replacing Health insurance
33. Policy covering minor child; premium fixed but death benefit increases by 5 times @ age 18 or 21.
Juvenile Life (aka Jumping Juvenile) policy
Total disability (any-occupational definition)
Viatical Settlement Provider (VSP)
Accidental Death & Dismemberment (AD&D) Life policy
34. Allows Insured to increase death benefit w/out medical exam (subject to age max.) w/ additional premium rate determined @ attained age.
Notice of Claim provision
Guaranteed Insurability Life rider
Cost of Living Adjustment (COLA) Disability rider
Endowment Life policy
35. WL policy covering 2 or more Insureds but payable upon death of FIRST Insured - after which policy ends.
Entire Contract provision
Joint Life (aka "First to die") policy
Equity Indexed annuity
Family policy
36. Federal law to protect Federal employees' (& their beneficiaries') pension - group insurance - & welfare benefits.
Claim Form (aka Proof of Loss Form) provision
Employee Retirement Income Security Act (ERISA)
Point of Service plan
Guaranteed Insurability Life rider
37. Level - fixed death benefit - premium fixed until renewal; Decreasing - death benefit decreases over term - premium fixed until renewal; Increasing - death benefit increases over term - premium fixed until renewal.
Types of Term Life policies
Premium modes
Types of Insurers (by authorization)
Medicare
38. If Insured changes to: more hazardous job - benefits reduced; less hazardous job - premiums reduce.
Medicare Supplement or Medigap policy
Term Life policy
Change of Occupation provision
Types of reinsurance
39. 1: Skilled nursing care; 2: Intermediate care; 3: Custodial care; 4: Home health care.
Levels of Long Term Care provided
Reinsurance
Basic Medical plan
Experience vs. Community rating in Group Health plan
40. Price of insurance per exposure unit.
Permanent vs. Temporary disability
Errors & Omissions (E&O)
Rate (as defined by CIC)
Trial Application (aka Request for Offer)
41. Provides for continued operation of business if partner dies - by allowing surviving partner(s) to buy deceased partner's interest in business.
Insurability Type Conditional receipt
Business Continuation (aka Buy-Sell) policy
Small Employer Medical Expense plan
Levels of Long Term Care provided
42. An attempt to contain costs by employing various strategies - including wellness programs - preventative testing - outpatient & alternative procedures.
Tax implications of an Annuity (1 of 2)
Annuity
Exclusions for Major Medical plan
Medical cost containment (aka Managed care)
43. Provides accidental death benefit @ full $ of "principal sum". Dismemberment is paid only @ 50% principal sum ("capital sum").
Insurer (as defined by CIC)
Claim Form (aka Proof of Loss Form) provision
Accidental Death & Dismemberment (AD&D) Life policy
Whole (aka Permanent or Straight) Life policy
44. 1: Individual; 2: Joint - multiple annuitants paid until 1st dies; 3: Joint & Survivor - multiple annuitants paid until 1st dies THEN survivors paid but @ reduced $.
Annuity Classifications (5 of 5): # of lives
Juvenile Life (aka Jumping Juvenile) policy
Rate (as defined by CIC)
Employee Retirement Income Security Act (ERISA)
45. 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.
Law of Large Numbers
Medi-Cal Share Cost plan
Dividend options
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
46. Covers entire family w/ WL for breadwinner & (convertible) Level Term for spouse & children (until certain age).
Insurance contract characteristics (1 of 2)
Family policy
Survivorship (aka "Last to die") policy
Trial Application (aka Request for Offer)
47. 'The inability to perform your OWN normal occupation or daily duties'.
Total disability (as commonly defined)
Rate (as defined by CIC)
Reinstatement provision
Age Discrimination in Employment Act (ADEA)
48. Life license + NASD (FINRA) Series 6 or 7.
Fraud
Requirements to sell variable life products
Beneficiary provisions
Supplemental Major Medical plan
49. Pre-existing illness/injury; Waiting period; Elimination period; Probationary period; Benefits - Exclusions - Limitations; Underwriting reqs.
Cross Purchase Plan
Considerations in replacing Health insurance
Endowment Life policy
Retrocession
50. 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.
Peril vs. Hazard
COBRA Time Limitations
Comprehensive Major Medical plan
Loss exposure