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






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






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






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






5. No-charge annuity w/drawals allowed up to 10% of total - THEN penalized on sliding scale based on # policy yrs.; conditionally waived.






6. Same as Comprehensive Major Medical but w/ integrated deductible; much more expensive.






7. Receipt whereby coverage incepts ONLY after underwriting approval.






8. 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.






9. 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.






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






11. 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.






12. 1: Straight aka Pure Life - lifetime income but no survivorship refund; 2: Life w/ Period Certain - lifetime income w/ death benefit of monthly annuity for remaining predetermined term. 3: Annuity Certain - monthly income paid for predetermined term






13. 1: Non-cancelable; 2: Guaranteed renewable; 3: Cancelable; 4: Conditionally renewable; 5: Optionally renewable.






14. 1: Skilled nursing care; 2: Intermediate care; 3: Custodial care; 4: Home health care.






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






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






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






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






19. Responsible adult trustee designated to manage death benefits for minor child beneficiary until adulthood.






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






21. Same as WL but premium low for set # yrs. - THEN premiums vary (+ or -) based on Insurer's investment returns - w/ Gmax.






22. PURELY employer-funded account to reimburse employees for qualified medical expenses not covered by group health plan.






23. 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.






24. 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).






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






26. Allows Insured to increase benefit w/out medical exam (subject to age max.) w/ additional premium rate determined @ attained age; must prove income increase.






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






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






29. 1: parties to contract; 2: insured party or life; 3: insurable interest - if 3rd party; 4: risks insured against; 5: policy period (term); 6: premium & mode.






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






31. Prohibited w/ regard to testing for people of same class; test results must remain confidential; coverage may be declined (once discovered).






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






33. Federal law which prohibits companies w/ 20+ employees from denying work & medical benefits to employees due to age.






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






35. Excludes coverage for specific injury/illness either temporarily or permanently in order to eliminate pre-existing condition.






36. Level - fixed death benefit - premium fixed until renewal; Decreasing - death benefit decreases over term - premium fixed until renewal; Increasing - death benefit increases over term - premium fixed until renewal.






37. Provides usual & customary business expenses (rent - utilities - salaries - mortgage) if owner becomes disabled; premiums deductible - benefits taxable.






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






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






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






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






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






43. 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.






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






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






46. Federal law which prohibits companies w/ 15+ employees from decreasing coverage benefits for women affected by pregnancy or childbirth.






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






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






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






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