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






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






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






4. 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.






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






6. Provides for continued operation of business if partner becomes disabled - by allowing other partner(s) to buy disabled partner's interest in business.






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






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






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






10. Generally 10 days after policy delivery to cancel policy w/ full refund - except 30 days for seniors or for replacement policies.






11. 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.






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






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






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






15. If Insured & primary beneficiary die due to same act (w/in 14 days) - primary assumed 1st to die & contingent beneficiary paid death benefit.






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






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






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






19. Coverage remains in effect for 31 days past premium due date; benefits paid during grace period would be deducted from sum.






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






21. 1: Individual; 2: Joint - multiple annuitants paid until 1st dies; 3: Joint & Survivor - multiple annuitants paid until 1st dies THEN survivors paid but @ reduced $.






22. 1: Single (lump sum) premium; 2: Periodic premiums - can be level (fixed $) OR flexible from mth. to mth. (w/ req. min.)






23. Fixed premium w/ guaranteed min. death benefit that may increase due to higher than expected investment returns.






24. Time period preceding each disability during which benefits are not paid; longer elimination periods = cheaper premium.






25. Death benefits & premium automatically increase annually based on inflationary index (i.e. Consumer Price Index).






26. Covers disabilities occurring ONLY "off" job; benefits do not overlap work. comp. (i.e. Group plan).






27. 'The inability to perform ANY gainful occupation'.






28. Provides 24 hr. health coverage both "on" & "off" job - but may cause coverage duplication & coordination challenges.






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






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






31. 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.






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






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






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






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






36. 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.






37. Tendency of poorer risks to seek insurance.






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






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






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






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






42. If Insured changes to: more hazardous job - benefits reduced; less hazardous job - premiums reduce.






43. 1: Tax-free lump sum; 2: Monthly pay-outs for fixed time; 3: Fixed monthly payments until depleted.






44. Qualified Annuity - Tax-deductible contributions & tax-deferred growth but fully taxable w/drawals.






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






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






47. Provides benefit during Social Security "black-out" period - up to 1 yr.






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






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






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