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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. 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.
Human Life Value approach
COBRA Time Limitations
Blue Cross/Blue Shield
Partial disability rider
2. Benefits automatically increase annually based on inflationary index (i.e. Consumer Price Index) OR flat rate (5% max.).
Medicaid/Medi-Cal
Cost of Living Adjustment (COLA) Disability rider
Exclusions to Work. Comp.
Spendthrift provision
3. Policy owner must notify Insurer of loss either in writing - in person or by phone w/in 20 days.
Disability Income policy
Notice of Claim provision
Dividends
Cross Purchase Plan
4. An attempt to contain costs by employing various strategies - including wellness programs - preventative testing - outpatient & alternative procedures.
Medical cost containment (aka Managed care)
Types of Medical Plans
Estoppel
Tax implications of medical plans
5. Waives premium on Life policy for minor child until age 21 in event premium payor dies or becomes disabled.
6. 1: Non-cancelable; 2: Guaranteed renewable; 3: Cancelable; 4: Conditionally renewable; 5: Optionally renewable.
Types of Renewability provisions
Fraud
Medicare Part D
Family Maintenance policy
7. Monthly; Quarterly; Semi-annually; Annually (cheapest due to less admin cost).
Considerations in replacing Health insurance
Doctrine of Comity
Premium modes
Accidental Death & Dismemberment (AD&D) Life policy
8. 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
9. War; elective cosmetic surgery; routine dental; work. comp.-covered claims; self-inflicted (intentional); gov't. facility treatment; LTC; private nursing.
Return of Cash Value rider
Elements to contract
Rescission
Exclusions for Major Medical plan
10. Info already known; Info that should have been known; Waived info; Irrelevant info.
Tax implications of Disability policy
Concealment exceptions
Types of Accident & Health insurance
Universal (aka Flexible Premium Adjustable) Life policy (4 of 4)
11. Allows Term policy conversion to Permanent policy w/out medical exam; must be identical or lower death benefit; based on either attained OR original age.
Medicare Part B (aka Supplemental Medical Insurance or SMI)
Permanent vs. Temporary disability
Convertibility provision
Dread Disease policy
12. Mathematical law stating the larger # of occurrences - the more predictable the losses; used to calculate premiums.
Occupational Disability policy
Dividends
Law of Large Numbers
Claim Form (aka Proof of Loss Form) provision
13. Federal law which prohibits companies w/ 20+ employees from denying work & medical benefits to employees due to age.
Age Discrimination in Employment Act (ADEA)
Presumptive disability
Universal (aka Flexible Premium Adjustable) Life policy (3 of 4)
Settlement options for Life policy (1 of 2)
14. 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.
Small Employer Medical Expense plan
Adjustable Whole Life policy
Dividends
Types of Insurers (by authorization)
15. Receipt whereby coverage incepts immediately upon submission of full consideration - unless declined & premium refunded.
Parole Pardon Rule
Binding receipt (aka Temporary Insurance Agreement)
Impairment (Exclusion) rider
Considerations in replacing Health insurance
16. No-cost provision that authorizes Insurer to borrow from cash value to pay unpaid premiums after grace period; must ask for @ app. time.
Penalties for violating AIDS/HIV privacy laws
Insurance contract characteristics (1 of 2)
Relation of Earnings to Insurance provision
Automatic Premium Loan (APL) provision
17. Prepaid med. benefits for members ONLY w/ approved primary care M.D. (HMO employee); focus on preventative care; low co-pay.
Juvenile Life (aka Jumping Juvenile) policy
Elements to contract
Cost of Living Adjustment (COLA) Disability rider
Health Maintenance Organization (HMO)
18. 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.
Medicare
Beneficiary provisions
Common Life Exclusions
Group Disability plan
19. 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.
Employer-Administered plan
Flexible Spending Account (FSA)
Tax implications of medical plans
Trusts
20. No deductible coverage for: daily room/board; ancillary costs; surgeon &/or physician expense (for added premium).
Legal Action provision
Loss exposure
Basic Medical plan
Endowment Life policy
21. Representation - oral or written statement made to best of knowledge or belief; Warranty - statement guaranteed/presumed/understood to be true.
Preferred Provider Organization (PPO)
Types of Accident & Health (A&H) providers
Universal (aka Flexible Premium Adjustable) Life policy (3 of 4)
Applicant Representations vs. Warranties
22. Prohibited w/ regard to testing for people of same class; test results must remain confidential; coverage may be declined (once discovered).
Experience vs. Community rating in Group Health plan
Law of Large Numbers
Dental Plan
AIDS/HIV discrimination
23. No-charge annuity w/drawals allowed up to 10% of total - THEN penalized on sliding scale based on # policy yrs.; conditionally waived.
Legal Action provision
Universal (aka Flexible Premium Adjustable) Life policy (3 of 4)
Common Disaster (Simultaneous Death Act) clause/provision
Annuity surrender charges
24. Waives premium upon disability of Insured until return to work; disability must persist for 90 days or longer; 1st 90 day premiums refunded after 90 days.
Waiver of Premium provision
Types of reinsurance
Transplant/Cosmetic Surgery rider
Mortality vs. Morbidity tables
25. Death benefits & premium automatically increase annually based on inflationary index (i.e. Consumer Price Index).
Binding receipt (aka Temporary Insurance Agreement)
Current Assumption (aka Interest-Sensitive) Whole Life policy
Insuring clause/provision (aka Insuring Agreement)
Cost of Living Adjustment (COLA) Life rider
26. Beneficiary has right to leave death benefits / Insurer to protect $ from creditors; interest (taxable) paid on retained funds.
Spendthrift provision
Endowment Life policy
Earned vs. Unearned premium
Term Life policy
27. Permanent disability due to total loss of sight - hearing - speech or use of 2 + limbs; benefits paid even while continuing to work.
Social Security (aka Old Age Survivors Disability Health Insurance or OASDHI)
Presumptive disability
Estoppel
Family Maintenance policy
28. Allows for use of HMO/PPO or other private carrier to provide expanded benefits @ additional premium & if enrolled in BOTH Parts A & B.
Survivorship (aka "Last to die") policy
Types of Accident & Health insurance
Medicare Part C (aka Medicare Advantage)
Comprehensive Major Medical plan
29. Must be delivered in person or by certified - registered or 1st-class mail w/ signature - unless waived by Insurance Commissioner.
Policy delivery
Health Reimbursement Account (HRA)
IRS Penalties for Annuities
Viatical Settlement Provider (VSP)
30. Hybrid of HMO & PPO w/ greater flexibility on choosing specialists outside network w/ benefits still provided but @ higher co-pay.
Tax implications of Death Benefit & Cash Value
Point of Service plan
Penalties for violating AIDS/HIV privacy laws
Modified Premium Whole Life policy
31. Prepaid med. benefits for members w/ approved primary care M.D. (independent); low co-pay; non-PPO M.D. can be used at higher cost.
Health Reimbursement Account (HRA)
Preferred Provider Organization (PPO)
Estoppel
Equity Indexed annuity
32. Accumulation or "pay-in" - contributions & interest earned are tax-deferred; Annuity or "pay-out" - monthly annuity (taxable) paid.
Phases of an annuity
Annuity surrender charges
Rehabilitation rider
Endowment Life policy
33. Provides hospital insurance automatically @ age 65 (if FICA qualified) @ no fee but may have deductible & co-pay.
Loss of Earnings Test
Juvenile Life (aka Jumping Juvenile) policy
Health Reimbursement Account (HRA)
Medicare Part A (aka Hospital Insurance or HI)
34. Group plan initially self-funded by employer (like SIR); after which - group plan Insurer covers (up to policy limit); requires TPA.
Credit Life policy
Medicare Supplement or Medigap policy
Employer-Administered plan
Supplemental Major Medical plan
35. War/Military; Intentional self-inflicted; Aviation (non-commercial); Foreign country; Loss of professional license; Illegal activity; Mental disorders (after 1-2 yrs.).
Notice of Claim provision
Common Disability Exclusions
Trusts
Health Maintenance Organization (HMO)
36. Price of insurance per exposure unit.
Rate (as defined by CIC)
Medical Savings Account (MSA) & Health Savings Account (HSA)
Long Term Care (LTC) policy
Annuity Classifications (5 of 5): # of lives
37. Policy must be delivered w/ original (or copy of same) application attached.
Entire Contract provision
Supplemental Major Medical plan
Presumptive disability
Primary Insurance Amount (PIA)
38. Domestic - within home state; Foreign - outside home state; Alien - outside home country.
Consolidated Omnibus Budget Reconciliation Act (COBRA)
Cost of Living Adjustment (COLA) Life rider
Medical cost containment (aka Managed care)
Types of Insurers (by domicile)
39. Policy owner has right to determine mode of premium payment but Insurer can charge admin. fee if not annual.
Consolidated Omnibus Budget Reconciliation Act (COBRA)
Payment of Premium provision
Entire Contract provision
Exclusions for Major Medical plan
40. Combination of Basic Medical & Major Medical in one policy; Basic pays 1st - then Major Medical w/ corridor deductible.
Common Life Exclusions
Dental Plan
Comprehensive Major Medical plan
Cost of Living Adjustment (COLA) Disability rider
41. Pre-existing illness/injury; Waiting period; Elimination period; Probationary period; Benefits - Exclusions - Limitations; Underwriting reqs.
Loss of Earnings Test
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
Considerations in replacing Health insurance
Civil Rights/Pregnancy Discrimination Act
42. Death benefit determined by Insured's financial goals & needs (minus assets).
Guaranteed Insurability Life rider
Employee Retirement Income Security Act (ERISA)
Tax implications of medical plans
Needs approach (most common)
43. Any person - assoc. - org. - partnership - business trust - LLC - or corp. capable of making an insurance contract.
Supplemental Major Medical plan
CA Work. Comp. Statutes
Residual disability rider
Insurer (as defined by CIC)
44. 1: Individual; 2: Joint - multiple annuitants paid until 1st dies; 3: Joint & Survivor - multiple annuitants paid until 1st dies THEN survivors paid but @ reduced $.
Types of Term Life policies
Split Dollar Plan
Annuity Classifications (5 of 5): # of lives
Settlement options for Life policy (1 of 2)
45. Provides for continued operation of business if partner dies - by allowing surviving partner(s) to buy deceased partner's interest in business.
Business Continuation (aka Buy-Sell) policy
Major Medical plan
Types of Renewability provisions
Accidental Death & Dismemberment (AD&D) Disability rider
46. An irrevocable IRS classification of a policy (determined by the 7 Pay Test) whereby tax advantages are lost for all distributions ONLY.
Term Life policy
Pure risk vs. Speculative risk
Requirements to sell variable life products
Modified Endowment Contract (MEC)
47. Funding mechanism whereby employer & employee share cost of premium. Upon death - benefit is shared between employer & beneficiary.
Elements to contract
Split Dollar Plan
Entire Contract provision
Considerations in replacing Health insurance
48. Policy owner has 90 days from date of loss to submit proof of loss to Insurer; valid claim must be paid immediately upon receipt.
Small Employer Medical Expense plan
Business Continuation (aka Buy-Sell) Disability policy
Proof of Loss provision
Guaranteed Insurability Life rider
49. Same as WL but w/ Decreasing Term rider; upon death - pays monthly income for REMAINING term AFTER which pays full death benefit.
Grace Period provision
Family Income policy
Transplant/Cosmetic Surgery rider
Common Disability Exclusions
50. Private sector (Commercial) - provides LA&H - P&C - & LTC; Public sector (Gov't) - provides flood - work. comp. - Medicare/Medicaid - Group Life (SGLI/FEGLI).
Types of Insurers (by sector)
Family policy
Enhanced Ordinary (aka Extraordinary) Whole Life policy
Credit Life policy