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Test your basic knowledge |
CA Life Agent Exam
Start Test
Study First
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. Experience - rates impacted by actual prior claim experience of actual group; Community - identical rates used for entire community - regardless of experience.
Dividend options
Experience vs. Community rating in Group Health plan
Insurable interest
Impairment (Exclusion) rider
2. 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.
Guaranteed Insurability Life rider
Total disability (any-occupational definition)
Valid life insurance contracts must identify...
Permanent vs. Temporary disability
3. Allows policy owner to w/draw set % of death benefit upon verification of terminal illness w/ expectancy 12-24 mths.; generally tax-free.
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
Health Maintenance Organization (HMO)
Cross Purchase Plan
Medical Savings Account (MSA) & Health Savings Account (HSA)
4. Application submitted w/out premium; no coverage until submission of full consideration & completed Statement of Continued Good Health.
AIDS/HIV discrimination
Trial Application (aka Request for Offer)
Types of Renewability provisions
Concealment exceptions
5. Provides for continued operation of business if partner becomes disabled - by allowing other partner(s) to buy disabled partner's interest in business.
Palliative vs. Curative care
Key Employee policy
Business Continuation (aka Buy-Sell) Disability policy
Phases of an annuity
6. Req. by CA statute & may provide workers coverage for action-over claims.
Employer Liability
Insurance contract characteristics (1 of 2)
Settlement options for Life policy (2 of 2)
Underwriting risk categories
7. Domestic - within home state; Foreign - outside home state; Alien - outside home country.
Total disability (as commonly defined)
Survivorship (aka "Last to die") policy
Business Continuation (aka Buy-Sell) policy
Types of Insurers (by domicile)
8. Provides % of monthly income benefit if Insured becomes disabled due to illness or accident.
Residual disability rider
Disability Income policy
Non-Occupational Disability policy
Workers' Compensation insurance
9. Actual/Expressed - written powers; Implied - unwritten but customary practices; Apparent - perceived powers.
Types of Agency Authority
Comprehensive Major Medical plan
Medicare Part D
Civil Rights/Pregnancy Discrimination Act
10. Excludes coverage for specific injury/illness either temporarily or permanently in order to eliminate pre-existing condition.
Key Employee policy
Whole (aka Permanent or Straight) Life policy
Equity Index Whole Life policy
Impairment (Exclusion) rider
11. Prepaid med. benefits for members ONLY w/ approved primary care M.D. (HMO employee); focus on preventative care; low co-pay.
Impairment (Exclusion) rider
Key Employee policy
Health Maintenance Organization (HMO)
Small Employer Medical Expense plan
12. Federally-funded but state-run program for truly indigent individuals & families providing medical care at Federal clinic.
Medicaid/Medi-Cal
Types of Accident & Health insurance
7 Pay Test
Key Employee policy
13. Same as Universal Life but cash value put in investment vehicles chosen by policy owner (stocks - bonds - munis.); cash value NOT guaranteed.
Types of Accident & Health insurance
Variable Universal Life policy
Loss of Earnings Test
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
14. Fixed premium w/ guaranteed min. death benefit that may increase due to higher than expected investment returns.
CA Work. Comp. Statutes
Types of Insurers (by authorization)
Annuity Classifications (2 of 5): When benefits begin
Variable Life policy (2 of 2)
15. Pure risk involves chance of loss ONLY (accident or misfortune). Speculative risk involves chance of loss OR gain (gambling - stock investment).
Pure risk vs. Speculative risk
Medicare Part C (aka Medicare Advantage)
Types of Insurers (miscellaneous)
Dread Disease policy
16. Excludes coverage for suicide during 1st 2 yrs. ONLY but - if it does - all premiums must be returned to beneficiary.
Long Term Care (LTC) policy
Suicide clause/provision
Credit Life policy
Universal (aka Flexible Premium Adjustable) Life policy (2 of 4)
17. If total premiums paid w/in 1st 7 yrs. exceed net level premium that should have been paid - policy is an MEC.
CHAMPUS (aka TriCare)
Long Term Care (LTC) policy
Notice of Claim provision
7 Pay Test
18. 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.
Health Reimbursement Account (HRA)
Plans A-L of Medical Supplement or Medigap
AIDS/HIV discrimination
Concealment exceptions
19. Life license + NASD (FINRA) Series 6 or 7.
Palliative vs. Curative care
Medicare Part C (aka Medicare Advantage)
Requirements to sell variable life products
Rate (as defined by CIC)
20. Allows Insured to increase death benefit w/out medical exam (subject to age max.) w/ additional premium rate determined @ attained age.
COBRA Time Limitations
Types of reinsurance
Tax implications of an Estate
Guaranteed Insurability Life rider
21. Same as WL but cash value put in investment vehicles chosen by policy owner (stocks - bonds - munis.); cash value NOT guaranteed.
Return of Cash Value rider
Automatic Premium Loan (APL) provision
Non-Occupational Disability policy
Variable Life policy (1 of 2)
22. Federal law which prohibits companies w/ 15+ employees from decreasing coverage benefits for women affected by pregnancy or childbirth.
Long Term Care (LTC) policy
Guaranteed Insurability Life rider
Free Look provision
Civil Rights/Pregnancy Discrimination Act
23. Provides benefit during Social Security "black-out" period - up to 1 yr.
Exclusions to Work. Comp.
Equity Index Whole Life policy
Social Security Benefit (Supplement) rider
Phases of an annuity
24. Prepaid med. benefits for "subscribers" @ approved facilities; many non-profit; Blue Cross - Hospital stays; Blue Shield - M.D. costs.
Blue Cross/Blue Shield
Modified Endowment Contract (MEC)
Total disability (as commonly defined)
1035 Exchange
25. Same as WL but w/ Level Term rider; upon death - pays monthly income for FULL term AFTER which pays full death benefit.
Health Insurance Portability and Accountability Act (HIPAA)
AIDS/HIV discrimination
Family Maintenance policy
Insuring clause/provision (aka Insuring Agreement)
26. Policy must be delivered w/ original (or copy of same) application attached.
Entire Contract provision
Types of Insurers (by sector)
Tax implications of Death Benefit & Cash Value
Preferred Provider Organization (PPO)
27. After 2-3 yrs. - Whole Life policy equity builds tax-deferred @ fixed interest rate until it equals death benefit; borrowable but taxable.
Doctrine of Comity
Cash value
COBRA Time Limitations
Exclusions to Work. Comp.
28. Provides coverage for specific disease(s) - such as cancer or leukemia.
Medicare Part B (aka Supplemental Medical Insurance or SMI)
Comprehensive Major Medical plan
Dread Disease policy
Mortality vs. Morbidity tables
29. Pays death benefit until age 100 or death; builds equity (cash value); may be transferred or sold; generally level premium.
Employer-Administered plan
Partial disability rider
Whole (aka Permanent or Straight) Life policy
Premium modes
30. Death benefit determined by Insured's projected lost earnings potential.
Health Insurance Portability and Accountability Act (HIPAA)
Comprehensive Major Medical plan
Human Life Value approach
Underwriting risk categories
31. An attempt to contain costs by employing various strategies - including wellness programs - preventative testing - outpatient & alternative procedures.
Payor (aka Waiver of Payor's Premium) rider
Types of Renewability provisions
Medical cost containment (aka Managed care)
Settlement options for Life policy (1 of 2)
32. Combination of Basic Medical & Major Medical in one policy; Basic pays 1st - then Major Medical w/ corridor deductible.
Supplemental Major Medical plan
Dividend options
Comprehensive Major Medical plan
Family policy
33. Same as WL but cash value increases @ current interest rates (not set); premium can start low or high & may change.
Medicare Supplement or Medigap policy
Current Assumption (aka Interest-Sensitive) Whole Life policy
Convertibility provision
Civil Rights/Pregnancy Discrimination Act
34. Death benefits & premium automatically increase annually based on inflationary index (i.e. Consumer Price Index).
Medicare Part A & B "Gaps"
Insurability Type Conditional receipt
Annuity Classifications (2 of 5): When benefits begin
Cost of Living Adjustment (COLA) Life rider
35. Allows for use of HMO/PPO or other private carrier to provide expanded benefits @ additional premium & if enrolled in BOTH Parts A & B.
Levels of Long Term Care provided
Employer Liability
Medicare Part C (aka Medicare Advantage)
Health Reimbursement Account (HRA)
36. 1: Tax-free lump sum; 2: Monthly pay-outs for fixed time; 3: Fixed monthly payments until depleted.
Settlement options for Life policy (1 of 2)
Types of Renewability provisions
Endowment Life policy
Modified Endowment Contract (MEC)
37. Prevents overinsuring in order to profit from disability by coordinating benefits between Insurers.
Adjustable Whole Life policy
Waiver of Premium provision
Relation of Earnings to Insurance provision
Business Continuation (aka Buy-Sell) policy
38. Written contract to transfer risk of premature death from one party to another; pays stated sum upon death; creates instant estate.
Medicare Part D
Life insurance policy
Rehabilitation rider
Adjustable Whole Life policy
39. Unilateral - Insurer provides contract; Adhesion - parties must adhere to terms; Aleatory - benefits may not inure equally.
Concealment
Insurance contract characteristics (1 of 2)
Equity Index Whole Life policy
Market Value Adjusted (aka Modified Guaranteed) annuity
40. Although death benefit is tax-free - it is included in gross estate value so federal &/or state taxes may apply to a portion in excess of fixed federal limit.
Policy loans
Variable Life policy (2 of 2)
Types of Insurers (by domicile)
Tax implications of an Estate
41. To "make whole again" w/out benefit or detriment; neither monetary profit nor loss.
Employee Retirement Income Security Act (ERISA)
Incontestability clause/provision
Indemnify
Family Maintenance policy
42. 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.
Renewability provision
Residual disability rider
Convertibility provision
Split Dollar Plan
43. WL policy covering 2 or more Insureds but ONLY payable upon death of LAST Insured - generally low premium but high death benefit.
Survivorship (aka "Last to die") policy
Total disability (as commonly defined)
Variable Universal Life policy
Tax implications of Death Benefit & Cash Value
44. Taxable income (unlike individual plans); can be either short-term - 13-52 wks. max. or long-term - longer than 52 wks.
Group Disability plan
Waiver of Premium provision
Notice of Claim provision
Annuity Classifications (1 of 5): How premium is paid
45. 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.
Risk management
Common Life Exclusions
Common Disability Exclusions
Health Insurance Portability and Accountability Act (HIPAA)
46. 'The inability to perform ANY gainful occupation'.
Cash value
Waiver of Premium provision
Total disability (any-occupational definition)
Guaranteed Insurability Life rider
47. Mathematical calculation based on overall FICA contributions used to determine retirement/disability/survivorship benefit.
Tax implications of an Estate
Types of Insurers (by ownership)
Comprehensive Major Medical plan
Primary Insurance Amount (PIA)
48. 1: Req. - unless self-employed; 2: 7-day wait for disability benefits; 3: Premium based on ex-mod; 4: Rates approved by CDI; 5: to sell - must satisfy education reqs.
Medi-Cal Share Cost plan
CA Work. Comp. Statutes
Business Continuation (aka Buy-Sell) policy
Settlement options for Life policy (1 of 2)
49. Multiple small employers w/ common affiliation (trade assoc. OR Chamber of Commerce) band together to purchase group plan.
Medicare Part D
Waiver of Premium provision
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
Valid life insurance contracts must identify...
50. An unintentional mistake committed by an insurance representative; may be covered by E&O insurance.
Graded Premium Whole Life policy
Partial disability rider
Errors & Omissions (E&O)
Exclusions to Work. Comp.