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






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






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






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






5. Intentional OR unintentional failure to disclose material underwriting facts that should have been disclosed; grounds for policy rescission.






6. Expands individual WL policy to include Term Life for dependents (spouse - children - etc.).






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






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






9. Govt. organization providing health care benefits for dependents of military personnel.






10. Provides for continued operation of business if partner becomes disabled - by allowing other partner(s) to buy disabled partner's interest in business.






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






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






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






14. Prepaid med. benefits for members ONLY w/ approved primary care M.D. (HMO employee); focus on preventative care; low co-pay.






15. Two death benefit options - Option A: death benefit ONLY; Option B: death benefit + cash value; death benefit NOT guaranteed.






16. Federal law allows employees/their dependents to continue group benefits w/in 60 days after termination (if employer has 20+ employees); Insured pays premium @ 102% of group cost.






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






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






19. Application submitted w/out premium; no coverage until submission of full consideration & completed Statement of Continued Good Health.






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






21. Receipt whereby coverage incepts conditionally upon submission of full consideration and that all underwriting reqs. are met.






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






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






24. 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.






25. Disability income is based on "earned income" (salary - bonus - commission) - not unearned income (interest - investment - rents).






26. Time period preceding each disability during which benefits are not paid; longer elimination periods = cheaper premium.






27. Insurance purchased by other Insurer(s) to spread or diversify risk; promotes industry stability.






28. Combination of Basic Medical & Major Medical in one policy; Basic pays 1st - then Major Medical w/ corridor deductible.






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






30. 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.






31. Dividends are NOT taxable but interest is. Loan interest is NOT tax-deductible. Interest paid by Insurer on retained funds is taxable.






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






33. Federal program financed by payroll taxes provided equally by both employer & employee OR entirely by individual (if self-employed). Provides benefits for: Medicare @ age 65+; retirement; $255 lump sum death benefit; (limited) disability; survivors;






34. Same as WL but w/ adjustable death benefit (& corresponding premium) & over-fund option but w/ annually renewable term (ART).






35. Same as WL but death benefit decreases each yr. w/ dividends paid annually to offset decrease.






36. Price of insurance per exposure unit.






37. Waives premium upon disability of Insured until return to work; disability must persist for 90 days or longer; 1st 90 day premiums refunded after 90 days.






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






39. Same as Universal Life but cash value put in investment vehicles chosen by policy owner (stocks - bonds - munis.); cash value NOT guaranteed.






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






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






42. Savings account for medical expenses; Tax-deductible contributions; tax-deferred growth; tax-free for qualified use; taxable for non-qualified use.






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






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






45. Disability policy rider covering "the inability to perform some - but not all of your duties"; pays max. 50% of disability benefit for up to 6 mths.






46. Fixed premium w/ guaranteed min. death benefit that may increase due to higher than expected investment returns.






47. Upon death - death benefit is paid + the aggregate of cash value accumulated to date; add-on to WL policy ONLY.






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






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






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