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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. 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.






2. Representation - oral or written statement made to best of knowledge or belief; Warranty - statement guaranteed/presumed/understood to be true.






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






4. Same as WL but cash value increases @ current interest rates (not set); premium can start low or high & may change.






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






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






7. Summary of coverage including premium & mode of payment - death benefit - beneficiary(ies) - exclusions - & promise to pay.






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






9. An attempt to contain costs by employing various strategies - including wellness programs - preventative testing - outpatient & alternative procedures.






10. Monthly; Quarterly; Semi-annually; Annually (cheapest due to less admin cost).






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






12. Provides professional services - rehabilitation - training/re-training & related costs to assist Insured in returning to work.






13. 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






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






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






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






17. 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.






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






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






20. Waives premium upon disability of Insured until return to work; disability must persist for 6 mths. or longer. Cash value & dividends not affected.






21. 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.






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






23. Must be delivered in person or by certified - registered or 1st-class mail w/ signature - unless waived by Insurance Commissioner.






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






25. Provides hospital insurance automatically @ age 65 (if FICA qualified) @ no fee but may have deductible & co-pay.






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






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






28. Agreement - Offer & acceptance; Consideration - application + premium; Legal capacity - licensed &/or competent; Legal purpose - public good.






29. IRS allows tax-free transfer of cash values between 2 LIKE policies (i.e. Life to Life - Annuity to Annuity - or Life to Annuity).






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






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






32. Process whereby a reinsurer reinsures w/ another reinsurer.






33. Non-qualified Annuity - Non-deductible contributions & tax-deferred growth. At pay-out - tax-free principal but taxable growth.






34. Basic Medical; Major Medical; Comprehensive Major Medical






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






36. Same as WL but premium low for 1st 5 yrs. - THEN has annual premium increases for set # yrs. - THEN level premium.






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






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






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






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






41. Mandatory 100% employer-funded coverage for injuries/illnesses occurring "on" job; full-time employees only; exclusive remedy. Provides: 1: unlimited medical benefit; 2: survivor income replacement & funeral ($5 -000 max.); 3: disability benefit @ 66

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42. 1: Fixed - guaranteed fixed monthly income & fixed interest rate; 2: Variable - unguaranteed; monthly income varies based on stocks/bond returns.






43. Written contract that provides INCOME @ high interest rate for fixed period OR for annuitant's lifetime w/ possible death benefit.






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






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






46. 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.






47. 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.






48. 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.






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






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







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