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. Process whereby a reinsurer reinsures w/ another reinsurer.






2. Allows Insured to increase death benefit w/out medical exam (subject to age max.) w/ additional premium rate determined @ attained age.






3. Process which prevents claim denial as a result of false statement or promise (made by Insurer) - which was relied upon by Insured.






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






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






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






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






8. 1: Immediate benefits rec'd w/in 30 days but premium must be paid by lump sum; 2: Deferred - usually until retirement.






9. Privately-provided or Medicare-provided (if no private carrier) prescription drug plans for qualified individuals but w/ premium - deductible & co-pay.






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






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






12. 1: Single (lump sum) premium; 2: Periodic premiums - can be level (fixed $) OR flexible from mth. to mth. (w/ req. min.)






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






14. Reappearance of disability w/in 6 mth. period after "recovery" from same disability is considered recurrence - not new disability.






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






16. Intentional deception; grounds for rescission.






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






18. 1: Fixed - guaranteed fixed monthly income & fixed interest rate; 2: Variable - unguaranteed; monthly income varies based on stocks/bond returns.






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






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






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






22. Group plan initially self-funded by employer (like SIR); after which - group plan Insurer covers (up to policy limit); requires TPA.






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






24. Federal law which allows health coverage portability when changing jobs - so long as previous coverage was in effect 63+ days; allows some tax deductibility for LTC.






25. 'The inability to perform your OWN normal occupation or daily duties'.






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






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






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






29. Pure risk involves chance of loss ONLY (accident or misfortune). Speculative risk involves chance of loss OR gain (gambling - stock investment).






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






31. Voiding an insurance contract based on fraud - concealment or material misrepresentation; premiums returned; policy treated as never existing.






32. Authorized (admitted) - can conduct business in state; Unauthorized (non-admitted) - cannot conduct business in state (w/ one exception).






33. 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.






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






35. If total premiums paid w/in 1st 7 yrs. exceed net level premium that should have been paid - policy is an MEC.






36. War - 2 types; Suicide (1st 2 yrs.); Aviation (non-commercial); Hazardous hobbies; Criminal acts; Alcohol/Drug influenced.






37. Price of insurance per exposure unit.






38. 1: Skilled nursing care; 2: Intermediate care; 3: Custodial care; 4: Home health care.






39. Provides increased death benefit if death occurs w/in 90 days & as result of accident; relatively INexpensive add-on.






40. If Insured & primary beneficiary die due to same act (w/in 14 days) - primary assumed 1st to die & contingent beneficiary paid death benefit.






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






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






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






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






45. Provides supplemental coverage for physician/surgeon fees if enrolled (during enrollment period ONLY) & pay monthly premium w/ deductible and co-insurance.






46. No-cost provision that authorizes Insurer to borrow from cash value to pay unpaid premiums after grace period; must ask for @ app. time.






47. Allows for Term policy renewal @ higher premium w/out medical exam; guarantees insurability; based on actual/attained age.






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






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






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