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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. Provides 24 hr. health coverage both "on" & "off" job - but may cause coverage duplication & coordination challenges.
24 Hour Coverage (CA)
Settlement options for Life policy (2 of 2)
Medicare Part A & B "Gaps"
Cross Purchase Plan
2. War; elective cosmetic surgery; routine dental; work. comp.-covered claims; self-inflicted (intentional); gov't. facility treatment; LTC; private nursing.
Types of Accident & Health (A&H) providers
Parole Pardon Rule
Exclusions for Major Medical plan
Occupational Disability policy
3. War - 2 types; Suicide (1st 2 yrs.); Aviation (non-commercial); Hazardous hobbies; Criminal acts; Alcohol/Drug influenced.
Blackout Period
Underwriting risk categories
Elements to contract
Common Life Exclusions
4. Multiple small employers w/ common affiliation (trade assoc. OR Chamber of Commerce) band together to purchase group plan.
Annuity
Medicare Part C (aka Medicare Advantage)
Claim Form (aka Proof of Loss Form) provision
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
5. 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;
Health Maintenance Organization (HMO)
Social Security (aka Old Age Survivors Disability Health Insurance or OASDHI)
Experience vs. Community rating in Group Health plan
Market Value Adjusted (aka Modified Guaranteed) annuity
6. Allows Insured to increase benefit w/out medical exam (subject to age max.) w/ additional premium rate determined @ attained age; must prove income increase.
Revocable vs. Irrevocable beneficiary
Return of Premium rider
Valid life insurance contracts must identify...
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
7. Insured can seek legal action against Insurer for denial of claim only after 60 days and up to 3 yrs. after providing proof of loss.
Types of Insurers (miscellaneous)
Medicare Part C (aka Medicare Advantage)
Legal Action provision
Modified Endowment Contract (MEC)
8. Pure risk involves chance of loss ONLY (accident or misfortune). Speculative risk involves chance of loss OR gain (gambling - stock investment).
Medical cost containment (aka Managed care)
Graded Premium Whole Life policy
Age Discrimination in Employment Act (ADEA)
Pure risk vs. Speculative risk
9. Prepaid med. benefits for members ONLY w/ approved primary care M.D. (HMO employee); focus on preventative care; low co-pay.
Health Maintenance Organization (HMO)
Waiver of Premium provision
Concealment exceptions
Insuring clause/provision (aka Insuring Agreement)
10. Must be delivered in person or by certified - registered or 1st-class mail w/ signature - unless waived by Insurance Commissioner.
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
Insurable interest
Employer Liability
Policy delivery
11. Death benefit is NOT taxable. Cash value grows tax-deferred but cost basis (base premium) is not taxable - only interest is.
Palliative vs. Curative care
Tax implications of Death Benefit & Cash Value
1035 Exchange
Mortality vs. Morbidity tables
12. Responsible adult trustee designated to manage death benefits for minor child beneficiary until adulthood.
Limited Pay Whole Life policy
Tax implications of Disability policy
Survivorship (aka "Last to die") policy
Trusts
13. Policy must be delivered w/ original (or copy of same) application attached.
Point of Service plan
Entire Contract provision
Modified Premium Whole Life policy
Errors & Omissions (E&O)
14. Beneficiary has right to leave death benefits / Insurer to protect $ from creditors; interest (taxable) paid on retained funds.
Annuity Classifications (5 of 5): # of lives
Guaranteed Insurability Life rider
Annuity surrender charges
Spendthrift provision
15. Mathematical law stating the larger # of occurrences - the more predictable the losses; used to calculate premiums.
Family Income policy
Health Maintenance Organization (HMO)
Applicant Representations vs. Warranties
Law of Large Numbers
16. Summary of coverage including premium & mode of payment - death benefit - beneficiary(ies) - exclusions - & promise to pay.
Insuring clause/provision (aka Insuring Agreement)
Health Reimbursement Account (HRA)
Legal Action provision
Concealment exceptions
17. Policyholders - Mutual (participating) co. - may pay dividends; Stockholders - Stock (non-participating) co. - no dividends.
Impairment (Exclusion) rider
Errors & Omissions (E&O)
Types of Insurers (by ownership)
Workers' Compensation insurance
18. Extreme form of Limited Pay Whole Life whereby entire premium is paid in a single payment.
Medicare Supplement or Medigap policy
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
Single Pay Whole Life policy
Reinstatement provision
19. Federal law which prohibits companies w/ 20+ employees from denying work & medical benefits to employees due to age.
Mortality vs. Morbidity tables
Age Discrimination in Employment Act (ADEA)
Relation of Earnings to Insurance provision
Total disability (as commonly defined)
20. Primary - if 2 or more - equally shared; Contingent (Secondary) - only if primary dead; Tertiary - only if both primary & secondary dead. If none listed - goes to estate.
Types of hazards
Tax implications of Disability policy
Tax implications of Death Benefit & Cash Value
Beneficiary provisions
21. Allows Insured to increase death benefit w/out medical exam (subject to age max.) w/ additional premium rate determined @ attained age.
Employee Retirement Income Security Act (ERISA)
Annuity Classifications (4 of 5): Disposition "pay-out" of proceeds
Guaranteed Insurability Life rider
Time Limit on Certain Defenses provision
22. Waives premium on Life policy for minor child until age 21 in event premium payor dies or becomes disabled.
23. Provides % of monthly income benefit if Insured becomes disabled due to illness or accident.
Tax implications of Dividends - Loans & Interest
Civil Rights/Pregnancy Discrimination Act
Disability Income policy
Peril vs. Hazard
24. Grows @ fixed min. interest rate but w/ possible higher rate tied to equity index (i.e S&P Equity Index) appreciation; gains shared w/ Insurer.
Spendthrift provision
Equity Indexed annuity
Types of Renewability provisions
Term Life policy
25. Death benefit determined by Insured's projected lost earnings potential.
Annuity Classifications (2 of 5): When benefits begin
Human Life Value approach
Return of Cash Value rider
Common Disaster (Simultaneous Death Act) clause/provision
26. Type of partial disability rider - which pays fluctuating % of lost income w/out time limit.
Residual disability rider
Preferred Provider Organization (PPO)
Time Limit on Certain Defenses provision
Annuity Classifications (1 of 5): How premium is paid
27. Same as Universal Life but cash value put in investment vehicles chosen by policy owner (stocks - bonds - munis.); cash value NOT guaranteed.
Occupational Disability policy
Types of Term Life policies
Variable Universal Life policy
Equity Indexed annuity
28. Provides hospital insurance automatically @ age 65 (if FICA qualified) @ no fee but may have deductible & co-pay.
Annuity Classifications (3 of 5): Source of income
Factors that determine premium
Medicare Part A (aka Hospital Insurance or HI)
Types of Agency Authority
29. 1: Skilled nursing care; 2: Intermediate care; 3: Custodial care; 4: Home health care.
Types of Insurers (by domicile)
Flexible Spending Account (FSA)
Levels of Long Term Care provided
Pure risk vs. Speculative risk
30. War/Military; Intentional self-inflicted; Aviation (non-commercial); Foreign country; Loss of professional license; Illegal activity; Mental disorders (after 1-2 yrs.).
Tax implications of Disability policy
Valid life insurance contracts must identify...
Preferred Provider Organization (PPO)
Common Disability Exclusions
31. Voiding an insurance contract based on fraud - concealment or material misrepresentation; premiums returned; policy treated as never existing.
Types of Insurers (by authorization)
Rescission
Common Disability Exclusions
Change of Occupation provision
32. Taxable income (unlike individual plans); can be either short-term - 13-52 wks. max. or long-term - longer than 52 wks.
Family or Dependents rider
Palliative vs. Curative care
Insurable interest
Group Disability plan
33. Group plan initially self-funded by employer (like SIR); after which - group plan Insurer covers (up to policy limit); requires TPA.
Types of Insurers (by authorization)
Employer-Administered plan
Insurability Type Conditional receipt
Equity Index Whole Life policy
34. Earned premium is $ paid for coverage to date. Unearned premium is $ paid & returnable due to coverage not provided.
Residual disability rider
Insurance contract characteristics (1 of 2)
Earned vs. Unearned premium
1035 Exchange
35. Allows for use of HMO/PPO or other private carrier to provide expanded benefits @ additional premium & if enrolled in BOTH Parts A & B.
Graded Premium Whole Life policy
Medicare Part C (aka Medicare Advantage)
Valid life insurance contracts must identify...
Annuity
36. Time extension of benefits based on "qualifying" event. 18 mth. extension if laid off or fired; 36 mth. extension if death - divorce or child leaves home.
COBRA Time Limitations
Transplant/Cosmetic Surgery rider
Tax implications of Death Benefit & Cash Value
Binding receipt (aka Temporary Insurance Agreement)
37. 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
Non-forfeiture options for WL policy
Types of Renewability provisions
Exclusions to Work. Comp.
Payor (aka Waiver of Payor's Premium) rider
38. Mathematical calculation based on overall FICA contributions used to determine retirement/disability/survivorship benefit.
Annuity Classifications (5 of 5): # of lives
Primary Insurance Amount (PIA)
Legal Action provision
Departments of an Insurer
39. Same as WL but w/ adjustable death benefit (& corresponding premium) & over-fund option but w/ annually renewable term (ART).
Payor (aka Waiver of Payor's Premium) rider
Life insurance policy
Insurance contract characteristics (2 of 2)
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
40. Receipt whereby coverage incepts ONLY after underwriting approval.
Misstatement of Age/Sex provision
Approval Type Conditional receipt
Business Overhead Expense (BOE) Disability policy
Survivorship (aka "Last to die") policy
41. Experience - rates impacted by actual prior claim experience of actual group; Community - identical rates used for entire community - regardless of experience.
Experience vs. Community rating in Group Health plan
COBRA Time Limitations
Modified Endowment Contract (MEC)
Types of Term Life policies
42. Life license + NASD (FINRA) Series 6 or 7.
Return of Premium rider
COBRA Time Limitations
Requirements to sell variable life products
Universal (aka Flexible Premium Adjustable) Life policy (4 of 4)
43. Facultative - case by case agreements; Automatic/Treaty - automatic acceptance of risk percentage per previous agreement.
Non-forfeiture options for WL policy
Types of reinsurance
IRS Penalties for Annuities
Health Reimbursement Account (HRA)
44. Policy covering minor child; premium fixed but death benefit increases by 5 times @ age 18 or 21.
Flexible Spending Account (FSA)
Juvenile Life (aka Jumping Juvenile) policy
Estoppel
Errors & Omissions (E&O)
45. Federal law to protect Federal employees' (& their beneficiaries') pension - group insurance - & welfare benefits.
Common Disability Exclusions
Types of Insurers (by sector)
7 Pay Test
Employee Retirement Income Security Act (ERISA)
46. 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
47. Preferred or Preferred Smoker; Standard or Standard Smoker; Substandard; Denied.
Underwriting risk categories
Total disability (more restrictive definition)
Modified Premium Whole Life policy
Types of Insurers (miscellaneous)
48. An attempt to contain costs by employing various strategies - including wellness programs - preventative testing - outpatient & alternative procedures.
Medical cost containment (aka Managed care)
Employee Retirement Income Security Act (ERISA)
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
Universal (aka Flexible Premium Adjustable) Life policy (3 of 4)
49. Partially state-funded benefits for low-income people whereby cost of care is shared between state & recipient - based on income.
Employee Retirement Income Security Act (ERISA)
1035 Exchange
Medi-Cal Share Cost plan
Social Security Benefit (Supplement) rider
50. Same as WL but premium low for set # yrs. - THEN premiums vary (+ or -) based on Insurer's investment returns - w/ Gmax.
Change of Occupation provision
Indeterminate Premium Whole Life policy
Medicare Supplement or Medigap policy
Mortality vs. Morbidity tables