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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. Type of partial disability rider - which pays fluctuating % of lost income w/out time limit.
Types of Accident & Health insurance
Tax implications of an Annuity (1 of 2)
Total disability (more restrictive definition)
Residual disability rider
2. Provides accidental death benefit @ full $ of "principal sum". Dismemberment is paid only @ 50% principal sum ("capital sum").
Joint Life (aka "First to die") policy
Variable Life policy (2 of 2)
Accidental Death & Dismemberment (AD&D) Life policy
Accidental Death & Dismemberment (AD&D) Disability rider
3. Same as WL but death benefit decreases each yr. w/ dividends paid annually to offset decrease.
Equity Indexed annuity
Exclusions to Work. Comp.
Elements to contract
Enhanced Ordinary (aka Extraordinary) Whole Life policy
4. Provides % of monthly income benefit if Insured becomes disabled due to illness or accident.
1035 Exchange
Small Employer Medical Expense plan
Indemnify
Disability Income policy
5. Any person - assoc. - org. - partnership - business trust - LLC - or corp. capable of making an insurance contract.
Insurer (as defined by CIC)
Total disability (any-occupational definition)
Concealment exceptions
Types of Accident & Health insurance
6. Taxable income (unlike individual plans); can be either short-term - 13-52 wks. max. or long-term - longer than 52 wks.
Payor (aka Waiver of Payor's Premium) rider
Social Security Benefit (Supplement) rider
Group Disability plan
Annuity Classifications (1 of 5): How premium is paid
7. 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
Exclusions to Work. Comp.
CHAMPUS (aka TriCare)
Loss exposure
Medicare Part C (aka Medicare Advantage)
8. Death benefit is NOT taxable. Cash value grows tax-deferred but cost basis (base premium) is not taxable - only interest is.
Departments of an Insurer
Tax implications of Death Benefit & Cash Value
Tax implications of medical plans
Types of Insurers (miscellaneous)
9. 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.
Applicant Representations vs. Warranties
Dread Disease policy
Underwriting risk categories
Waiver of Premium provision
10. 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)
Small Employer Medical Expense plan
Beneficiary provisions
Free Look provision
11. Financial interest in insured party that must exist @ time of application OR policy issuance. Requires consent (except minors).
Accidental Death (aka Multiple Indemnity) rider
Transplant/Cosmetic Surgery rider
Insurable interest
Annuity Classifications (3 of 5): Source of income
12. Mathematical calculation based on overall FICA contributions used to determine retirement/disability/survivorship benefit.
Free Look provision
Primary Insurance Amount (PIA)
Tax implications of an Annuity (1 of 2)
Annuity Classifications (3 of 5): Source of income
13. Covers entire family w/ WL for breadwinner & (convertible) Level Term for spouse & children (until certain age).
Equity Indexed annuity
Departments of an Insurer
Family policy
Medicaid/Medi-Cal
14. Insurer has right to rescind policy & return premium if material misrepresentation in application is found w/in 1st 2 yrs.
Medicare Supplement or Medigap policy
Needs approach (most common)
Business Continuation (aka Buy-Sell) policy
Incontestability clause/provision
15. Receipt whereby coverage incepts ONLY after underwriting approval.
Types of Medical Plans
Approval Type Conditional receipt
Employee Retirement Income Security Act (ERISA)
Payment of Premium provision
16. Same as WL but cash value increases @ current interest rates (not set); premium can start low or high & may change.
Tax implications of medical plans
Current Assumption (aka Interest-Sensitive) Whole Life policy
Insuring clause/provision (aka Insuring Agreement)
Single Pay Whole Life policy
17. 1: Immediate benefits rec'd w/in 30 days but premium must be paid by lump sum; 2: Deferred - usually until retirement.
CHAMPUS (aka TriCare)
Survivorship (aka "Last to die") policy
Common Accident provision
Annuity Classifications (2 of 5): When benefits begin
18. Pays death benefit until age 100 or death; builds equity (cash value); may be transferred or sold; generally level premium.
Types of reinsurance
Whole (aka Permanent or Straight) Life policy
Parole Pardon Rule
Grace Period provision
19. Policyholders - Mutual (participating) co. - may pay dividends; Stockholders - Stock (non-participating) co. - no dividends.
Waiver of Premium provision
Earned vs. Unearned premium
Types of Insurers (by ownership)
Misstatement of Age/Sex provision
20. Covers disabilities occurring both "on" AND "off" job; "on" job benefits paid in addition to work. comp. - if applicable (i.e. individual plan).
Occupational Disability policy
Tax implications of Disability policy
Reinsurance
Fraud
21. Funding mechanism whereby employer & employee share cost of premium. Upon death - benefit is shared between employer & beneficiary.
Split Dollar Plan
Pure risk vs. Speculative risk
AIDS/HIV discrimination
Small Employer Medical Expense plan
22. Partially state-funded benefits for low-income people whereby cost of care is shared between state & recipient - based on income.
Fraud
Whole (aka Permanent or Straight) Life policy
Suicide clause/provision
Medi-Cal Share Cost plan
23. An attempt to contain costs by employing various strategies - including wellness programs - preventative testing - outpatient & alternative procedures.
Point of Service plan
Return of Cash Value rider
Medical cost containment (aka Managed care)
Market Value Adjusted (aka Modified Guaranteed) annuity
24. 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
Universal (aka Flexible Premium Adjustable) Life policy (3 of 4)
Tax implications of medical plans
Equity Indexed annuity
Annuity Classifications (4 of 5): Disposition "pay-out" of proceeds
25. 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.
Exclusions to Work. Comp.
Market Value Adjusted (aka Modified Guaranteed) annuity
Beneficiary provisions
Workers' Compensation insurance
26. Excludes coverage for specific injury/illness either temporarily or permanently in order to eliminate pre-existing condition.
Accidental Death & Dismemberment (AD&D) Life policy
Impairment (Exclusion) rider
Payor (aka Waiver of Payor's Premium) rider
Permanent vs. Temporary disability
27. Provides coverage for specific disease(s) - such as cancer or leukemia.
Penalties for violating AIDS/HIV privacy laws
Trial Application (aka Request for Offer)
Dread Disease policy
Annuity
28. Palliative - treatment to manage pain; Curative - treatment to cure illness/condition.
24 Hour Coverage (CA)
Medicare Part A & B "Gaps"
Guaranteed Insurability Life rider
Palliative vs. Curative care
29. Summary of coverage including premium & mode of payment - death benefit - beneficiary(ies) - exclusions - & promise to pay.
Insuring clause/provision (aka Insuring Agreement)
Levels of Long Term Care provided
Rescission
Tax implications of an Estate
30. Same as WL but cash value put in investment vehicles chosen by policy owner (stocks - bonds - munis.); cash value NOT guaranteed.
Rehabilitation rider
Enhanced Ordinary (aka Extraordinary) Whole Life policy
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
Variable Life policy (1 of 2)
31. Extreme form of Limited Pay Whole Life whereby entire premium is paid in a single payment.
Single Pay Whole Life policy
24 Hour Coverage (CA)
Insurance contract characteristics (1 of 2)
Tax implications of Disability policy
32. Provides for continued operation of business if partner dies - by allowing surviving partner(s) to buy deceased partner's interest in business.
Universal (aka Flexible Premium Adjustable) Life policy (4 of 4)
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
Mortality vs. Morbidity tables
Business Continuation (aka Buy-Sell) policy
33. 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.
Exclusions to Work. Comp.
Approval Type Conditional receipt
Dependent coverage
Dividend options
34. Same as WL but can be "paid-up" early by paying larger premium for shorter payment period (i.e. 10 Pay Life - 20 Pay Life).
Limited Pay Whole Life policy
Juvenile Life (aka Jumping Juvenile) policy
Accidental Death & Dismemberment (AD&D) Disability rider
Settlement options for Life policy (1 of 2)
35. Provides for continued operation of business if partner becomes disabled - by allowing other partner(s) to buy disabled partner's interest in business.
Automatic Premium Loan (APL) provision
Single Pay Whole Life policy
Universal (aka Flexible Premium Adjustable) Life policy (3 of 4)
Business Continuation (aka Buy-Sell) Disability policy
36. Specialized policy covering diagnostic & preventative dental care; often no deductible; co-insurance; expensive; may be included w/ medical plan.
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
Dental Plan
Universal (aka Flexible Premium Adjustable) Life policy (4 of 4)
Proof of Loss provision
37. Domestic - within home state; Foreign - outside home state; Alien - outside home country.
Annuity Classifications (1 of 5): How premium is paid
Business Continuation (aka Buy-Sell) policy
Medical cost containment (aka Managed care)
Types of Insurers (by domicile)
38. Fixed premium w/ guaranteed min. death benefit that may increase due to higher than expected investment returns.
Free Look provision
24 Hour Coverage (CA)
Employer-Administered plan
Variable Life policy (2 of 2)
39. Process which prevents claim denial as a result of false statement or promise (made by Insurer) - which was relied upon by Insured.
Estoppel
Common Disability Exclusions
Errors & Omissions (E&O)
Market Value Adjusted (aka Modified Guaranteed) annuity
40. Two death benefit options - Option A: death benefit ONLY; Option B: death benefit + cash value; death benefit NOT guaranteed.
Universal (aka Flexible Premium Adjustable) Life policy (4 of 4)
Dread Disease policy
Types of Licensed Producers
Universal (aka Flexible Premium Adjustable) Life policy (2 of 4)
41. 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.
Flexible Spending Account (FSA)
Group Disability plan
CA Work. Comp. Statutes
Return of Premium rider
42. Multiple small employers w/ common affiliation (trade assoc. OR Chamber of Commerce) band together to purchase group plan.
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
COBRA Time Limitations
Business Continuation (aka Buy-Sell) policy
Penalties for violating AIDS/HIV privacy laws
43. 1: Non-cancelable; 2: Guaranteed renewable; 3: Cancelable; 4: Conditionally renewable; 5: Optionally renewable.
Types of Renewability provisions
Basic Medical plan
Errors & Omissions (E&O)
Cost of Living Adjustment (COLA) Life rider
44. War/Military; Intentional self-inflicted; Aviation (non-commercial); Foreign country; Loss of professional license; Illegal activity; Mental disorders (after 1-2 yrs.).
Current Assumption (aka Interest-Sensitive) Whole Life policy
Indeterminate Premium Whole Life policy
Common Accident provision
Common Disability Exclusions
45. Govt. organization providing health care benefits for dependents of military personnel.
CHAMPUS (aka TriCare)
Partial disability rider
Incontestability clause/provision
Modified Endowment Contract (MEC)
46. The state in which the contract is accepted or delivered is the state that possesses regulatory jurisdiction over Group plan.
Doctrine of Comity
Tax implications of an Estate
Types of Term Life policies
Employee Retirement Income Security Act (ERISA)
47. Provides supplemental coverage for physician/surgeon fees if enrolled (during enrollment period ONLY) & pay monthly premium w/ deductible and co-insurance.
Current Assumption (aka Interest-Sensitive) Whole Life policy
Social Security Benefit (Supplement) rider
Permanent vs. Temporary disability
Medicare Part B (aka Supplemental Medical Insurance or SMI)
48. Upon death - death benefit is paid + the aggregate of premiums paid to date; add-on to Term policy ONLY.
Return of Premium rider
Employee Retirement Income Security Act (ERISA)
Presumptive disability
24 Hour Coverage (CA)
49. Available for any reason up to full cash value @ fixed (max 8%) OR variable interest rate; loan $ + interest deducted from benefit @ death.
Policy loans
Annuity Classifications (3 of 5): Source of income
Workers' Compensation insurance
Single Pay Whole Life policy
50. Compensates business for loss due to death or disability of key employee; premiums not deductible but benefits tax-free.
Earned vs. Unearned premium
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
Exclusions to Work. Comp.
Key Employee policy