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






2. Dependent children are covered until 19 or 23 (full-time student only) or until self-sufficient (if handicapped).






3. 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.






4. Fraternal - non-profit - members only; Reciprocal - unincorp'd org. - members insure each other; Lloyd's Assoc. - groups sharing risks; Surplus lines - special market risks.






5. WL policy covering 2 or more Insureds but payable upon death of FIRST Insured - after which policy ends.






6. Must be delivered in person or by certified - registered or 1st-class mail w/ signature - unless waived by Insurance Commissioner.






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






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






9. Upon notice - Insurer must provide Claim Form (Proof of Loss Form) to Insured w/in 15 days.






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






11. Policyholders - Mutual (participating) co. - may pay dividends; Stockholders - Stock (non-participating) co. - no dividends.






12. Same as WL but premium low for set # yrs. - THEN premiums vary (+ or -) based on Insurer's investment returns - w/ Gmax.






13. Dividends are NOT taxable but interest is. Loan interest is NOT tax-deductible. Interest paid by Insurer on retained funds is taxable.






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






15. Benefits NOT taxable; employer-paid premiums deductible to employer; individual plans not deductible unless over 7 1/2% of adjusted gross income - then excess deductible.






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






17. Revocable - changeable anytime w/ Change of Beneficiary Form; Irrevocable - not changeable w/out beneficiary permission.






18. Provides % of monthly income benefit if Insured becomes disabled due to illness or accident.






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






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






21. A lapsed policy may be reinstated if not longer than 3-5 yrs. - & proof of insurability re-established - & back premiums + interest paid.






22. Responsible adult trustee designated to manage death benefits for minor child beneficiary until adulthood.






23. 1: Straight aka Pure Life - lifetime income but no survivorship refund; 2: Life w/ Period Certain - lifetime income w/ death benefit of monthly annuity for remaining predetermined term. 3: Annuity Certain - monthly income paid for predetermined term






24. Req. by CA statute & may provide workers coverage for action-over claims.






25. 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.






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






27. Non-qualified Annuity - Non-deductible contributions & tax-deferred growth. At pay-out - tax-free principal but taxable growth.






28. Basic Medical; Major Medical; Comprehensive Major Medical






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






30. Provides professional services - rehabilitation - training/re-training & related costs to assist Insured in returning to work.






31. Term Life policy w/ decreasing death benefit; usually used to secure credit (loan) w/ lender as beneficiary & borrower as Insured.






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






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






34. Policy owner has right to determine mode of premium payment but Insurer can charge admin. fee if not annual.






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






36. 1: Surrender for cash value (taxable); 2: Buy equal-benefit paid-up Level Term policy; 3: Buy reduced-benefit paid-up WL policy.






37. Voiding an insurance contract based on fraud - concealment or material misrepresentation; premiums returned; policy treated as never existing.






38. Agreement - Offer & acceptance; Consideration - application + premium; Legal capacity - licensed &/or competent; Legal purpose - public good.






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






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






41. Hybrid of HMO & PPO w/ greater flexibility on choosing specialists outside network w/ benefits still provided but @ higher co-pay.






42. Written contract that provides INCOME @ high interest rate for fixed period OR for annuitant's lifetime w/ possible death benefit.






43. Facultative - case by case agreements; Automatic/Treaty - automatic acceptance of risk percentage per previous agreement.






44. Disability income is based on "earned income" (salary - bonus - commission) - not unearned income (interest - investment - rents).






45. Employer w/ 25 or less employees must offer all eligible employees @ least 2 medical plan options where pre-existing conditions can't be excluded more than 1 yr.






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






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






48. Excludes coverage for specific injury/illness either temporarily or permanently in order to eliminate pre-existing condition.






49. Federal law to protect Federal employees' (& their beneficiaries') pension - group insurance - & welfare benefits.






50. Provides usual & customary business expenses (rent - utilities - salaries - mortgage) if owner becomes disabled; premiums deductible - benefits taxable.