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. 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.






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






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






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






5. 1: Single (lump sum) premium; 2: Periodic premiums - can be level (fixed $) OR flexible from mth. to mth. (w/ req. min.)






6. Permanent disability due to total loss of sight - hearing - speech or use of 2 + limbs; benefits paid even while continuing to work.






7. Covers disabilities occurring both "on" AND "off" job; "on" job benefits paid in addition to work. comp. - if applicable (i.e. individual plan).






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






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






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






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






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






13. War/Military; Intentional self-inflicted; Aviation (non-commercial); Foreign country; Loss of professional license; Illegal activity; Mental disorders (after 1-2 yrs.).






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






15. Upon death - death benefit is paid + the aggregate of premiums paid to date; add-on to Term policy ONLY.






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






17. 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.






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






19. An irrevocable IRS classification of a policy (determined by the 7 Pay Test) whereby tax advantages are lost for all distributions ONLY.






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






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






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






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






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






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






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






27. Basic Medical; Major Medical; Comprehensive Major Medical






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






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






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






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






32. Provides accidental death benefit @ full $ of "principal sum". Dismemberment is paid only @ 50% principal sum ("capital sum").






33. 1: Individual; 2: Joint - multiple annuitants paid until 1st dies; 3: Joint & Survivor - multiple annuitants paid until 1st dies THEN survivors paid but @ reduced $.






34. Potential circumstance that could cause a loss; measured in dollars.






35. Allows for use of HMO/PPO or other private carrier to provide expanded benefits @ additional premium & if enrolled in BOTH Parts A & B.






36. Earned premium is $ paid for coverage to date. Unearned premium is $ paid & returnable due to coverage not provided.






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






38. 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.






39. Refund of 50-80% of premium (minus claims paid) every 5-10 yrs. OR age 65; expensive!






40. Employer w/ 25 or less employees must offer all eligible employees @ least 2 medical plan options where pre-existing conditions can't be excluded more than 1 yr.






41. Unintentional - up to $1 -000 + legal $; Intentional - $1 -000-5 -000 + legal $; If harmful - misdemeanor + up to 1 yr. prison + up to $10 -000.






42. Intentional deception; grounds for rescission.






43. 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.






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






45. Pre-existing illness/injury; Waiting period; Elimination period; Probationary period; Benefits - Exclusions - Limitations; Underwriting reqs.






46. 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).






47. 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






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






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






50. Experience - rates impacted by actual prior claim experience of actual group; Community - identical rates used for entire community - regardless of experience.