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. Peril is the CAUSE of loss. Hazard is a condition that increases LIKELIHOOD of loss.






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






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






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






5. 1: Fixed - guaranteed fixed monthly income & fixed interest rate; 2: Variable - unguaranteed; monthly income varies based on stocks/bond returns.






6. Policy provisions must conform to state regulations where policy is sold.






7. Receipt whereby coverage incepts ONLY after underwriting approval.






8. Available for any reason up to full cash value @ fixed (max 8%) OR variable interest rate; loan $ + interest deducted from benefit @ death.






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






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






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






12. 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.






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






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






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






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






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






18. Life license + NASD (FINRA) Series 6 or 7.






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






20. To "make whole again" w/out benefit or detriment; neither monetary profit nor loss.






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






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






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






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






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






26. Funding mechanism whereby employer & employee share cost of premium. Upon death - benefit is shared between employer & beneficiary.






27. 4: Funds retained by Insurer until w/drawn - interest ONLY paid monthly (taxable); 5: Paid-up immediate annuity.






28. 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;






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






30. Plan A is the CORE benefit & is least expensive; All other plans include Plan A + additional benefits. Plans F & J are high deductible. K & L are both deductible & co-pay plans.






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






32. Provides for continued operation of business if partner dies - by allowing surviving partner(s) to buy deceased partner's interest in business.






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






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






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






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






37. Preferred or Preferred Smoker; Standard or Standard Smoker; Substandard; Denied.






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






39. 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.






40. 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.






41. Beneficiary has right to leave death benefits / Insurer to protect $ from creditors; interest (taxable) paid on retained funds.






42. Identical to Incontestable Clause in Life policy.






43. Same as WL but premium low for 1st 3-5 yrs. - THEN has one-time premium increase.






44. Any person - assoc. - org. - partnership - business trust - LLC - or corp. capable of making an insurance contract.






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






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






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






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






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






50. Private sector (Commercial) - provides LA&H - P&C - & LTC; Public sector (Gov't) - provides flood - work. comp. - Medicare/Medicaid - Group Life (SGLI/FEGLI).