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






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






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






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






5. 1: Cash (tax-free); 2: Apply to future premiums; 3: Retained by Insurer @ interest; 4: Buy Paid-up WL policy add-ons; 5: Pay-up existing policy; 6: Buy 1-yr. Term policy.






6. Treating or mitigating loss exposures through 1: avoidance; 2: retention (deductibles); 3: sharing; 4: reduction; or 5: transfer.






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






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






9. Mathematical calculation based on overall FICA contributions used to determine retirement/disability/survivorship benefit.






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






11. Same as WL but w/ Decreasing Term rider; upon death - pays monthly income for REMAINING term AFTER which pays full death benefit.






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






13. Provides supplemental coverage for physician/surgeon fees if enrolled (during enrollment period ONLY) & pay monthly premium w/ deductible and co-insurance.






14. Intentional deception; grounds for rescission.






15. 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.






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






17. Savings account for medical expenses; Tax-deductible contributions; tax-deferred growth; tax-free for qualified use; taxable for non-qualified use.






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






19. 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.






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






21. Periodic return of premium to policy owners from Mutual (Par) Companies; not guaranteed & not taxable as income; may be used in 6 ways.






22. Multiple small employers w/ common affiliation (trade assoc. OR Chamber of Commerce) band together to purchase group plan.






23. Provides accidental death benefit @ full $ of "principal sum". Dismemberment is paid only @ 50% principal sum ("capital sum").






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. Same as WL but w/ adjustable death benefit (& corresponding premium) & over-fund option but w/ annually renewable term (ART).






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






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






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






29. A company providing lump sum buyout (50-90% of total) of Life policy; becomes owner & beneficiary & assumes premium payments; usually terminally ill viator.






30. Same as Comprehensive Major Medical but w/ integrated deductible; much more expensive.






31. If total premiums paid w/in 1st 7 yrs. exceed net level premium that should have been paid - policy is an MEC.






32. 1: Surrender for cash value (taxable); 2: Buy equal-benefit paid-up Level Term policy; 3: Buy reduced-benefit paid-up WL policy.






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






34. Coverage for catastrophic loss w/ high limits - front end deductible; co-insurance (80/20%); blanket coverage; stop loss max.






35. Info already known; Info that should have been known; Waived info; Irrelevant info.






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






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






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






39. Monthly; Quarterly; Semi-annually; Annually (cheapest due to less admin cost).






40. Annuity distributions prior to age 59 1/2 incur a 10% IRS penalty EXCEPT for death - disability - immediate annuity - or rollover.






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






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






43. 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.






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






45. Written contract to transfer risk of premature death from one party to another; pays stated sum upon death; creates instant estate.






46. A&H - A&S - Sickness only; Medical; Disability; Accident only; Travel accident; LTC; Medicare supplement; AD&D; Dental/Vision/Prescription; Limited.






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






48. Reappearance of disability w/in 6 mth. period after "recovery" from same disability is considered recurrence - not new disability.






49. Same as WL but policy owner can adjust death benefit w/ corresponding premium adjustments; mostly obsolete.






50. Domestic - within home state; Foreign - outside home state; Alien - outside home country.