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. 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;






2. 1: Individual; 2: Joint - multiple annuitants paid until 1st dies; 3: Joint & Survivor - multiple annuitants paid until 1st dies THEN survivors paid but @ reduced $.






3. Same as WL but death benefit increases annually - linked to Consumer Price Index; premium increases annually OR is set high from start.






4. 'The inability to perform ANY reasonable occupation based on education - training or experience'.






5. Conditional - coverage is conditional; Personal - parties are people; Good faith - honesty/integrity; Fiduciary - req's financial trust.






6. Allows Term policy conversion to Permanent policy w/out medical exam; must be identical or lower death benefit; based on either attained OR original age.






7. Part A - Inpatient hospital deductibles vary on # of days; limited reserve days; finite benefit; 1st 3 pints blood; Part B - 20% co-payment.






8. Prepaid med. benefits for members w/ approved primary care M.D. (independent); low co-pay; non-PPO M.D. can be used at higher cost.






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






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






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






12. Dependent children are covered until 19 or 23 (full-time student only) or until self-sufficient (if handicapped).






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






14. Premiums determined by target cash values or death benefit; partial cash value w/drawals allowed; transparent policy w/ unbundled premium.






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






16. Death benefit determined by Insured's financial goals & needs (minus assets).






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






18. Commercial (private) companies; HMOs; PPOs; Blue Cross/Blue Shield; Employer-sponsored plans; Government.






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






20. 1: Immediate benefits rec'd w/in 30 days but premium must be paid by lump sum; 2: Deferred - usually until retirement.






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






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






23. Privately-sold policies to provide benefits not covered by Medicare; divided into 12 plans listed alphabetically A - L; 30-day free look; guaranteed renewable.






24. 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






25. Financial interest in insured party that must exist @ time of application OR policy issuance. Requires consent (except minors).






26. Req. by CA statute & may provide workers coverage for action-over claims.






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






28. Provides coverage for specific disease(s) - such as cancer or leukemia.






29. 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.






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






31. 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.






32. Federally-sponsored health care for individuals 65+ &/or w/ certain disabilities; may run concurrent w/ group plan but group plan would act primary - THEN Medicare.






33. 1: mortality probability charge; 2: Insurer's investment return; 3: expenses (admin costs - commissions). 1 - 2 = net; 1 - 2 + 3 = gross.






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






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






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






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






38. 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.






39. Underwriting - determines insurability; Marketing/Sales - determines products; Actuarial - determines rates; Claims - investigates/pays claims.






40. Written contract to transfer risk of premature death from one party to another; pays stated sum upon death; creates instant estate.






41. Domestic - within home state; Foreign - outside home state; Alien - outside home country.






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






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






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






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






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






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






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






49. Taxable income (unlike individual plans); can be either short-term - 13-52 wks. max. or long-term - longer than 52 wks.






50. Allows policy owner to w/draw set % of death benefit upon verification of terminal illness w/ expectancy 12-24 mths.; generally tax-free.