SUBJECTS
|
BROWSE
|
CAREER CENTER
|
POPULAR
|
JOIN
|
LOGIN
Business Skills
|
Soft Skills
|
Basic Literacy
|
Certifications
About
|
Help
|
Privacy
|
Terms
|
Email
Search
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. 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;
Primary Insurance Amount (PIA)
Dividends
Social Security (aka Old Age Survivors Disability Health Insurance or OASDHI)
Types of Term Life policies
2. 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
Universal (aka Flexible Premium Adjustable) Life policy (4 of 4)
Adverse selection
Common Accident provision
3. Facultative - case by case agreements; Automatic/Treaty - automatic acceptance of risk percentage per previous agreement.
Non-forfeiture options for WL policy
Types of reinsurance
Insurer (as defined by CIC)
Grace Period provision
4. If Insured changes to: more hazardous job - benefits reduced; less hazardous job - premiums reduce.
Change of Occupation provision
Variable Universal Life policy
Elimination (aka Waiting) period
Basic Medical plan
5. Agents - represent Insurer; Brokers - represent themselves & Insured; Solicitors - represent one agent to solicit leads.
Tax implications of Death Benefit & Cash Value
Types of Licensed Producers
Accidental Death (aka Multiple Indemnity) rider
Concealment
6. Policy owner has 90 days from date of loss to submit proof of loss to Insurer; valid claim must be paid immediately upon receipt.
Limited Pay Whole Life policy
Proof of Loss provision
Age Discrimination in Employment Act (ADEA)
Family Maintenance policy
7. Covers disabilities occurring both "on" AND "off" job; "on" job benefits paid in addition to work. comp. - if applicable (i.e. individual plan).
Settlement options for Life policy (1 of 2)
Limited Pay Whole Life policy
Occupational Disability policy
Point of Service plan
8. Application submitted w/out premium; no coverage until submission of full consideration & completed Statement of Continued Good Health.
Retrocession
Trial Application (aka Request for Offer)
Beneficiary provisions
Civil Rights/Pregnancy Discrimination Act
9. Responsible adult trustee designated to manage death benefits for minor child beneficiary until adulthood.
Trusts
Graded Premium Whole Life policy
Credit Life policy
Return of Cash Value rider
10. Period of time following any children's survivor benefit & before benefits are provided to employee's widow/widower.
Survivorship (aka "Last to die") policy
Annuity surrender charges
Types of reinsurance
Blackout Period
11. Process which prevents claim denial as a result of false statement or promise (made by Insurer) - which was relied upon by Insured.
Employer-Administered plan
Estoppel
Civil Rights/Pregnancy Discrimination Act
Annuity
12. Actual/Expressed - written powers; Implied - unwritten but customary practices; Apparent - perceived powers.
Types of Agency Authority
Juvenile Life (aka Jumping Juvenile) policy
Health Insurance Portability and Accountability Act (HIPAA)
Types of Insurers (by sector)
13. Policy owner has right to determine mode of premium payment but Insurer can charge admin. fee if not annual.
Insurable interest
Payment of Premium provision
Return of Cash Value rider
Relation of Earnings to Insurance provision
14. Palliative - treatment to manage pain; Curative - treatment to cure illness/condition.
Palliative vs. Curative care
Enhanced Ordinary (aka Extraordinary) Whole Life policy
7 Pay Test
Accidental Death & Dismemberment (AD&D) Disability rider
15. Must be delivered in person or by certified - registered or 1st-class mail w/ signature - unless waived by Insurance Commissioner.
Policy delivery
Medi-Cal Share Cost plan
Valid life insurance contracts must identify...
Key Employee Disability policy
16. Permanent - not recoverable (spinal cord injury); Temporary - recoverable (temp. illness/injury - broken limb).
Permanent vs. Temporary disability
Beneficiary provisions
Grace Period provision
Common Disaster (Simultaneous Death Act) clause/provision
17. Non-qualified Annuity - Non-deductible contributions & tax-deferred growth. At pay-out - tax-free principal but taxable growth.
Factors that determine premium
Dividend options
Tax implications of an Annuity (1 of 2)
Approval Type Conditional receipt
18. War; elective cosmetic surgery; routine dental; work. comp.-covered claims; self-inflicted (intentional); gov't. facility treatment; LTC; private nursing.
Variable Life policy (2 of 2)
Indeterminate Premium Whole Life policy
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
Exclusions for Major Medical plan
19. Dividends are NOT taxable but interest is. Loan interest is NOT tax-deductible. Interest paid by Insurer on retained funds is taxable.
Modified Endowment Contract (MEC)
Tax implications of Dividends - Loans & Interest
Equity Indexed annuity
Annuity Classifications (5 of 5): # of lives
20. Revocable - changeable anytime w/ Change of Beneficiary Form; Irrevocable - not changeable w/out beneficiary permission.
Occupational Disability policy
Revocable vs. Irrevocable beneficiary
Types of Insurers (miscellaneous)
Annuity Classifications (2 of 5): When benefits begin
21. Compensates business for loss due to disability of key employee; premiums not deductible but benefits tax-free.
Term Life policy
Key Employee Disability policy
Reinstatement provision
Medical Savings Account (MSA) & Health Savings Account (HSA)
22. Treating or mitigating loss exposures through 1: avoidance; 2: retention (deductibles); 3: sharing; 4: reduction; or 5: transfer.
Types of Insurers (by ownership)
Automatic Premium Loan (APL) provision
Medicare
Risk management
23. Policy owner must notify Insurer of loss either in writing - in person or by phone w/in 20 days.
Factors that determine premium
Major Medical plan
Change of Occupation provision
Notice of Claim provision
24. 'The inability to perform ANY gainful occupation'.
Viatical Settlement Provider (VSP)
Factors that determine premium
Settlement options for Life policy (2 of 2)
Total disability (any-occupational definition)
25. Reappearance of disability w/in 6 mth. period after "recovery" from same disability is considered recurrence - not new disability.
Recurrent disability clause/provision
CHAMPUS (aka TriCare)
Business Overhead Expense (BOE) Disability policy
Medical Savings Account (MSA) & Health Savings Account (HSA)
26. Privately-sold policies to provide benefits not covered by Medicare; divided into 12 plans listed alphabetically A - L; 30-day free look; guaranteed renewable.
Human Life Value approach
Medicare Supplement or Medigap policy
Market Value Adjusted (aka Modified Guaranteed) annuity
Graded Premium Whole Life policy
27. 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.
Types of Accident & Health (A&H) providers
Waiver of Premium provision
Tax implications of Disability policy
Annuity surrender charges
28. Insurer has right to rescind policy & return premium if material misrepresentation in application is found w/in 1st 2 yrs.
Plans A-L of Medical Supplement or Medigap
Beneficiary provisions
Incontestability clause/provision
Variable Life policy (1 of 2)
29. Provides for continued operation of business if partner dies - by allowing surviving partner(s) to buy deceased partner's interest in business.
Medicare Supplement or Medigap policy
Concealment exceptions
Business Continuation (aka Buy-Sell) policy
Retrocession
30. Earned premium is $ paid for coverage to date. Unearned premium is $ paid & returnable due to coverage not provided.
Presumptive disability
Earned vs. Unearned premium
Consolidated Omnibus Budget Reconciliation Act (COBRA)
Human Life Value approach
31. Temp. coverage for set duration w/ death benefit ONLY (no cash value) - offers largest $ for lowest premium; renewable; convertible.
Mortality vs. Morbidity tables
Health Reimbursement Account (HRA)
Term Life policy
Dependent coverage
32. No-cost provision that authorizes Insurer to borrow from cash value to pay unpaid premiums after grace period; must ask for @ app. time.
Small Employer Medical Expense plan
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
Rehabilitation rider
Automatic Premium Loan (APL) provision
33. Allows for Term policy renewal @ higher premium w/out medical exam; guarantees insurability; based on actual/attained age.
Renewability provision
Policy delivery
Medicare Supplement or Medigap policy
Dividend options
34. Federal law which prohibits companies w/ 15+ employees from decreasing coverage benefits for women affected by pregnancy or childbirth.
Equity Indexed annuity
Civil Rights/Pregnancy Discrimination Act
Tax implications of an Annuity (1 of 2)
Partial disability rider
35. 1: Req. - unless self-employed; 2: 7-day wait for disability benefits; 3: Premium based on ex-mod; 4: Rates approved by CDI; 5: to sell - must satisfy education reqs.
CA Work. Comp. Statutes
1035 Exchange
Total disability (any-occupational definition)
Term Life policy
36. Provides accidental death benefit @ full $ of "principal sum". Dismemberment is paid only @ 50% principal sum ("capital sum").
Accidental Death & Dismemberment (AD&D) Life policy
Cross Purchase Plan
Health Reimbursement Account (HRA)
Concealment exceptions
37. Upon death - death benefit is paid + the aggregate of premiums paid to date; add-on to Term policy ONLY.
Consolidated Omnibus Budget Reconciliation Act (COBRA)
Return of Premium rider
Relation of Earnings to Insurance provision
Cost of Living Adjustment (COLA) Disability rider
38. Insurer has right to adjust (+ or -) death benefit if age or sex is misstated but normally doesn't void policy.
Credit Life policy
Elements to contract
Revocable vs. Irrevocable beneficiary
Misstatement of Age/Sex provision
39. War/Military; Intentional self-inflicted; Aviation (non-commercial); Foreign country; Loss of professional license; Illegal activity; Mental disorders (after 1-2 yrs.).
Common Disability Exclusions
Concealment
Time Limit on Certain Defenses provision
Grace Period provision
40. War - 2 types; Suicide (1st 2 yrs.); Aviation (non-commercial); Hazardous hobbies; Criminal acts; Alcohol/Drug influenced.
Family Income policy
Relation of Earnings to Insurance provision
Binding receipt (aka Temporary Insurance Agreement)
Common Life Exclusions
41. An irrevocable IRS classification of a policy (determined by the 7 Pay Test) whereby tax advantages are lost for all distributions ONLY.
Indeterminate Premium Whole Life policy
Modified Endowment Contract (MEC)
Annuity surrender charges
Accidental Death (aka Multiple Indemnity) rider
42. 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)
Types of Renewability provisions
Equity Index Whole Life policy
Family policy
43. Taxable income (unlike individual plans); can be either short-term - 13-52 wks. max. or long-term - longer than 52 wks.
Group Disability plan
Experience vs. Community rating in Group Health plan
Adjustable Whole Life policy
Occupational Disability policy
44. Periodic return of premium to policy owners from Mutual (Par) Companies; not guaranteed & not taxable as income; may be used in 6 ways.
Modified Endowment Contract (MEC)
1035 Exchange
Medicare Part A (aka Hospital Insurance or HI)
Dividends
45. 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.
Legal Action provision
Medicare Part A (aka Hospital Insurance or HI)
Annuity Classifications (1 of 5): How premium is paid
Plans A-L of Medical Supplement or Medigap
46. 1: Single (lump sum) premium; 2: Periodic premiums - can be level (fixed $) OR flexible from mth. to mth. (w/ req. min.)
Needs approach (most common)
Annuity Classifications (3 of 5): Source of income
Grace Period provision
Annuity Classifications (1 of 5): How premium is paid
47. Fraternal - non-profit - members only; Reciprocal - unincorp'd org. - members insure each other; Lloyd's Assoc. - groups sharing risks; Surplus lines - special market risks.
Common Life Exclusions
Dread Disease policy
Types of Insurers (miscellaneous)
Retrocession
48. Experience - rates impacted by actual prior claim experience of actual group; Community - identical rates used for entire community - regardless of experience.
Dependent coverage
Experience vs. Community rating in Group Health plan
Single Pay Whole Life policy
Premium modes
49. Preferred or Preferred Smoker; Standard or Standard Smoker; Substandard; Denied.
Concealment
Whole (aka Permanent or Straight) Life policy
Underwriting risk categories
Parole Pardon Rule
50. 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.
Equity Indexed annuity
Time Limit on Certain Defenses provision
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
Annuity