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






2. 'The inability to perform your OWN normal occupation or daily duties'.






3. Allows for Term policy renewal @ higher premium w/out medical exam; guarantees insurability; based on actual/attained age.






4. Experience - rates impacted by actual prior claim experience of actual group; Community - identical rates used for entire community - regardless of experience.






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






6. Policy must be delivered w/ original (or copy of same) application attached.






7. 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.






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






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






10. Allows policy owner to w/draw set % of death benefit upon verification of terminal illness w/ expectancy 12-24 mths.; generally tax-free.






11. Benefits automatically increase annually based on inflationary index (i.e. Consumer Price Index) OR flat rate (5% max.).






12. 1: Immediate benefits rec'd w/in 30 days but premium must be paid by lump sum; 2: Deferred - usually until retirement.






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






14. Expands individual WL policy to include Term Life for dependents (spouse - children - etc.).






15. No deductible coverage for: daily room/board; ancillary costs; surgeon &/or physician expense (for added premium).






16. The state in which the contract is accepted or delivered is the state that possesses regulatory jurisdiction over Group plan.






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






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






19. 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.






20. Partially state-funded benefits for low-income people whereby cost of care is shared between state & recipient - based on income.






21. Tendency of poorer risks to seek insurance.






22. Privately-provided or Medicare-provided (if no private carrier) prescription drug plans for qualified individuals but w/ premium - deductible & co-pay.






23. Part of IRS Section 125 cafeteria plan - which allows pre-tax payroll deductions for qualified medical expenses or child/dependent care.






24. 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.






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






26. 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;






27. Federally-funded but state-run program for truly indigent individuals & families providing medical care at Federal clinic.






28. Policy owner must notify Insurer of loss either in writing - in person or by phone w/in 20 days.






29. An unintentional mistake committed by an insurance representative; may be covered by E&O insurance.






30. Receipt whereby coverage incepts conditionally upon submission of full consideration and that all underwriting reqs. are met.






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






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






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






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






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






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






37. 1: Skilled nursing care; 2: Intermediate care; 3: Custodial care; 4: Home health care.






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






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






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






42. Same as Term Life but provides living benefit (endowment) to policy owner if Insured survives entire term.






43. Pre-existing illness/injury; Waiting period; Elimination period; Probationary period; Benefits - Exclusions - Limitations; Underwriting reqs.






44. Financial interest in insured party that must exist @ time of application OR policy issuance. Requires consent (except minors).






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






46. Underwriting - determines insurability; Marketing/Sales - determines products; Actuarial - determines rates; Claims - investigates/pays claims.






47. Period of time following any children's survivor benefit & before benefits are provided to employee's widow/widower.






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






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






50. Guaranteed min. interest rate on cash value buildup but possible higher rate if short-term investment returns higher than expected.