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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. War - 2 types; Suicide (1st 2 yrs.); Aviation (non-commercial); Hazardous hobbies; Criminal acts; Alcohol/Drug influenced.
Comprehensive Major Medical plan
Tax implications of an Annuity (1 of 2)
Approval Type Conditional receipt
Common Life Exclusions
2. Reappearance of disability w/in 6 mth. period after "recovery" from same disability is considered recurrence - not new disability.
Insuring clause/provision (aka Insuring Agreement)
Free Look provision
Recurrent disability clause/provision
Levels of Long Term Care provided
3. Mandatory 100% employer-funded coverage for injuries/illnesses occurring "on" job; full-time employees only; exclusive remedy. Provides: 1: unlimited medical benefit; 2: survivor income replacement & funeral ($5 -000 max.); 3: disability benefit @ 66
4. Allows Insured to increase benefit w/out medical exam (subject to age max.) w/ additional premium rate determined @ attained age; must prove income increase.
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
Medicare Supplement or Medigap policy
Preferred Provider Organization (PPO)
Annuity surrender charges
5. Upon death - death benefit is paid + the aggregate of cash value accumulated to date; add-on to WL policy ONLY.
Binding receipt (aka Temporary Insurance Agreement)
Return of Cash Value rider
24 Hour Coverage (CA)
Concealment
6. Provides 24 hr. health coverage both "on" & "off" job - but may cause coverage duplication & coordination challenges.
Residual disability rider
24 Hour Coverage (CA)
Dental Plan
Types of Insurers (by domicile)
7. IRS allows tax-free transfer of cash values between 2 LIKE policies (i.e. Life to Life - Annuity to Annuity - or Life to Annuity).
Reinstatement provision
1035 Exchange
Insurance contract characteristics (2 of 2)
Medical cost containment (aka Managed care)
8. Provides disability income during surgery recovery from life-threatening condition (& sometimes cosmetic surgery).
Change of Occupation provision
Return of Cash Value rider
Return of Premium rider
Transplant/Cosmetic Surgery rider
9. Potential circumstance that could cause a loss; measured in dollars.
Medicare
Adjustable Whole Life policy
Loss exposure
Juvenile Life (aka Jumping Juvenile) policy
10. Actual/Expressed - written powers; Implied - unwritten but customary practices; Apparent - perceived powers.
Impairment (Exclusion) rider
Approval Type Conditional receipt
Types of Agency Authority
Accidental Death & Dismemberment (AD&D) Life policy
11. Same as WL but w/ Level Term rider; upon death - pays monthly income for FULL term AFTER which pays full death benefit.
Reinstatement provision
Family Maintenance policy
Medicare Part B (aka Supplemental Medical Insurance or SMI)
Exclusions to Work. Comp.
12. Mathematical law stating the larger # of occurrences - the more predictable the losses; used to calculate premiums.
Consolidated Omnibus Budget Reconciliation Act (COBRA)
Law of Large Numbers
Palliative vs. Curative care
Modified Endowment Contract (MEC)
13. Facultative - case by case agreements; Automatic/Treaty - automatic acceptance of risk percentage per previous agreement.
Types of reinsurance
Concealment exceptions
Beneficiary provisions
Settlement options for Life policy (1 of 2)
14. Policy provisions must conform to state regulations where policy is sold.
Business Continuation (aka Buy-Sell) policy
Phases of an annuity
Factors that determine premium
Conformity with State Statute provision
15. Peril is the CAUSE of loss. Hazard is a condition that increases LIKELIHOOD of loss.
24 Hour Coverage (CA)
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
Peril vs. Hazard
Types of Insurers (by authorization)
16. Written contract that provides INCOME @ high interest rate for fixed period OR for annuitant's lifetime w/ possible death benefit.
Convertibility provision
Common Life Exclusions
Annuity
Common Disaster (Simultaneous Death Act) clause/provision
17. Agreement - Offer & acceptance; Consideration - application + premium; Legal capacity - licensed &/or competent; Legal purpose - public good.
Conformity with State Statute provision
Types of Agency Authority
Levels of Long Term Care provided
Elements to contract
18. Covers entire family w/ WL for breadwinner & (convertible) Level Term for spouse & children (until certain age).
Family policy
Concealment
Types of Insurers (by domicile)
Medicare Part D
19. Receipt whereby coverage incepts conditionally upon submission of full consideration and that all underwriting reqs. are met.
Types of Insurers (by sector)
Insurability Type Conditional receipt
Major Medical plan
Term Life policy
20. 1: Skilled nursing care; 2: Intermediate care; 3: Custodial care; 4: Home health care.
Types of Renewability provisions
Age Discrimination in Employment Act (ADEA)
Conformity with State Statute provision
Levels of Long Term Care provided
21. 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.
Tax implications of Disability policy
Accidental Death (aka Multiple Indemnity) rider
Medi-Cal Share Cost plan
Endowment Life policy
22. 'The inability to perform ANY reasonable occupation based on education - training or experience'.
Exclusions for Major Medical plan
Employer-Administered plan
Convertibility provision
Total disability (more restrictive definition)
23. Pure risk involves chance of loss ONLY (accident or misfortune). Speculative risk involves chance of loss OR gain (gambling - stock investment).
Tax implications of Death Benefit & Cash Value
Indeterminate Premium Whole Life policy
Pure risk vs. Speculative risk
Tax implications of an Annuity (1 of 2)
24. 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
Types of Agency Authority
Exclusions to Work. Comp.
Comprehensive Major Medical plan
Social Security Benefit (Supplement) rider
25. Representation - oral or written statement made to best of knowledge or belief; Warranty - statement guaranteed/presumed/understood to be true.
Employer-Administered plan
Applicant Representations vs. Warranties
Common Accident provision
Long Term Care (LTC) policy
26. Expands individual WL policy to include Term Life for dependents (spouse - children - etc.).
Rescission
Family or Dependents rider
Medicare Part C (aka Medicare Advantage)
Non-forfeiture options for WL policy
27. Annuity distributions prior to age 59 1/2 incur a 10% IRS penalty EXCEPT for death - disability - immediate annuity - or rollover.
Settlement options for Life policy (1 of 2)
Medicare Part A (aka Hospital Insurance or HI)
IRS Penalties for Annuities
Consolidated Omnibus Budget Reconciliation Act (COBRA)
28. Funding mechanism whereby employer & employee share cost of premium. Upon death - benefit is shared between employer & beneficiary.
Modified Premium Whole Life policy
Split Dollar Plan
Group Disability plan
Supplemental Major Medical plan
29. Covers disabilities occurring both "on" AND "off" job; "on" job benefits paid in addition to work. comp. - if applicable (i.e. individual plan).
Insurance contract characteristics (1 of 2)
Fraud
Occupational Disability policy
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
30. 1: Non-cancelable; 2: Guaranteed renewable; 3: Cancelable; 4: Conditionally renewable; 5: Optionally renewable.
Types of Renewability provisions
Errors & Omissions (E&O)
Cost of Living Adjustment (COLA) Disability rider
Elimination (aka Waiting) period
31. Time period preceding each disability during which benefits are not paid; longer elimination periods = cheaper premium.
Annuity Classifications (5 of 5): # of lives
Elimination (aka Waiting) period
Mortality vs. Morbidity tables
Survivorship (aka "Last to die") policy
32. Provides supplemental coverage for physician/surgeon fees if enrolled (during enrollment period ONLY) & pay monthly premium w/ deductible and co-insurance.
Convertibility provision
Settlement options for Life policy (1 of 2)
Medicare Part B (aka Supplemental Medical Insurance or SMI)
Tax implications of medical plans
33. No deductible coverage for: daily room/board; ancillary costs; surgeon &/or physician expense (for added premium).
Graded Premium Whole Life policy
Basic Medical plan
Payor (aka Waiver of Payor's Premium) rider
Time Limit on Certain Defenses provision
34. Waives premium on Life policy for minor child until age 21 in event premium payor dies or becomes disabled.
35. Commercial (private) companies; HMOs; PPOs; Blue Cross/Blue Shield; Employer-sponsored plans; Government.
Settlement options for Life policy (2 of 2)
Types of Licensed Producers
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
Types of Accident & Health (A&H) providers
36. Process which prevents claim denial as a result of false statement or promise (made by Insurer) - which was relied upon by Insured.
Cost of Living Adjustment (COLA) Disability rider
Estoppel
Needs approach (most common)
Family or Dependents rider
37. Coverage remains in effect for 31 days past premium due date; benefits paid during grace period would be deducted from sum.
Grace Period provision
Common Accident provision
Family policy
Settlement options for Life policy (1 of 2)
38. Federally-sponsored health care for individuals 65+ &/or w/ certain disabilities; may run concurrent w/ group plan but group plan would act primary - THEN Medicare.
Medicare
Departments of an Insurer
Incontestability clause/provision
Time Limit on Certain Defenses provision
39. Physical - slippery floor; Moral - dishonest acts; Morale - carelessness or recklessness.
Levels of Long Term Care provided
Medicare Part C (aka Medicare Advantage)
Types of hazards
Settlement options for Life policy (2 of 2)
40. 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.
Insurer (as defined by CIC)
Types of Term Life policies
Policy delivery
Types of Licensed Producers
41. Monthly; Quarterly; Semi-annually; Annually (cheapest due to less admin cost).
Payor (aka Waiver of Payor's Premium) rider
Premium modes
Preferred Provider Organization (PPO)
Types of Accident & Health (A&H) providers
42. The state in which the contract is accepted or delivered is the state that possesses regulatory jurisdiction over Group plan.
Doctrine of Comity
Annuity Classifications (3 of 5): Source of income
Common Disability Exclusions
Types of Agency Authority
43. Same as WL but cash value put in investment vehicles chosen by policy owner (stocks - bonds - munis.); cash value NOT guaranteed.
Variable Life policy (1 of 2)
Medicare Part A (aka Hospital Insurance or HI)
Payment of Premium provision
Recurrent disability clause/provision
44. Privately-provided or Medicare-provided (if no private carrier) prescription drug plans for qualified individuals but w/ premium - deductible & co-pay.
Medicare Part D
AIDS/HIV discrimination
Annuity Classifications (1 of 5): How premium is paid
Recurrent disability clause/provision
45. Written policy terms supersede oral statements made prior to policy issue.
Parole Pardon Rule
Earned vs. Unearned premium
Common Disaster (Simultaneous Death Act) clause/provision
Medicare Part C (aka Medicare Advantage)
46. Waives premium upon disability of Insured until return to work; disability must persist for 6 mths. or longer. Cash value & dividends not affected.
Rate (as defined by CIC)
Renewability provision
Medical Savings Account (MSA) & Health Savings Account (HSA)
Waiver of Premium (Waiver of Cost of Insurance) rider
47. Disability income is based on "earned income" (salary - bonus - commission) - not unearned income (interest - investment - rents).
Loss of Earnings Test
Dividends
Limited Pay Whole Life policy
Partial disability rider
48. Life license + NASD (FINRA) Series 6 or 7.
Conformity with State Statute provision
Requirements to sell variable life products
Insurance contract characteristics (2 of 2)
Primary Insurance Amount (PIA)
49. Premiums determined by target cash values or death benefit; partial cash value w/drawals allowed; transparent policy w/ unbundled premium.
Universal (aka Flexible Premium Adjustable) Life policy (2 of 4)
Dental Plan
Spendthrift provision
Long Term Care (LTC) policy
50. Policy must be delivered w/ original (or copy of same) application attached.
Entire Contract provision
Annuity Classifications (1 of 5): How premium is paid
Medi-Cal Share Cost plan
Equity Index Whole Life policy