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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. Allows for use of HMO/PPO or other private carrier to provide expanded benefits @ additional premium & if enrolled in BOTH Parts A & B.
Medicare Part C (aka Medicare Advantage)
Major Medical plan
Renewability provision
Tax implications of an Estate
2. Experience - rates impacted by actual prior claim experience of actual group; Community - identical rates used for entire community - regardless of experience.
Annuity Classifications (3 of 5): Source of income
Experience vs. Community rating in Group Health plan
Cash value
Residual disability rider
3. Provides accidental death benefit @ full $ of "principal sum". Dismemberment is paid only @ 50% principal sum ("capital sum").
COBRA Time Limitations
Accidental Death & Dismemberment (AD&D) Disability rider
Misstatement of Age/Sex provision
Tax implications of an Annuity (1 of 2)
4. Unintentional - up to $1 -000 + legal $; Intentional - $1 -000-5 -000 + legal $; If harmful - misdemeanor + up to 1 yr. prison + up to $10 -000.
Equity Indexed annuity
Blackout Period
Enhanced Ordinary (aka Extraordinary) Whole Life policy
Penalties for violating AIDS/HIV privacy laws
5. 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)
Annuity Classifications (4 of 5): Disposition "pay-out" of proceeds
Equity Indexed annuity
Estoppel
6. Privately-sold policies to provide benefits not covered by Medicare; divided into 12 plans listed alphabetically A - L; 30-day free look; guaranteed renewable.
Medicare Supplement or Medigap policy
Types of Licensed Producers
Binding receipt (aka Temporary Insurance Agreement)
Trusts
7. Basic Medical; Major Medical; Comprehensive Major Medical
Age Discrimination in Employment Act (ADEA)
Earned vs. Unearned premium
Binding receipt (aka Temporary Insurance Agreement)
Types of Medical Plans
8. Allows policy owner to w/draw set % of death benefit upon verification of terminal illness w/ expectancy 12-24 mths.; generally tax-free.
Types of Insurers (by authorization)
Revocable vs. Irrevocable beneficiary
Social Security (aka Old Age Survivors Disability Health Insurance or OASDHI)
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
9. Authorized (admitted) - can conduct business in state; Unauthorized (non-admitted) - cannot conduct business in state (w/ one exception).
Types of Insurers (by authorization)
Civil Rights/Pregnancy Discrimination Act
Return of Premium rider
Settlement options for Life policy (1 of 2)
10. If Insured & primary beneficiary die due to same act (w/in 14 days) - primary assumed 1st to die & contingent beneficiary paid death benefit.
Common Disaster (Simultaneous Death Act) clause/provision
Variable Universal Life policy
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
Blackout Period
11. Covers disabilities occurring ONLY "off" job; benefits do not overlap work. comp. (i.e. Group plan).
Viatical Settlement Provider (VSP)
Elements to contract
Non-Occupational Disability policy
Life insurance policy
12. Coverage remains in effect for 31 days past premium due date; benefits paid during grace period would be deducted from sum.
Grace Period provision
Tax implications of an Annuity (1 of 2)
Medicare Part A (aka Hospital Insurance or HI)
Dividend options
13. A&H - A&S - Sickness only; Medical; Disability; Accident only; Travel accident; LTC; Medicare supplement; AD&D; Dental/Vision/Prescription; Limited.
Types of Accident & Health insurance
Universal (aka Flexible Premium Adjustable) Life policy (3 of 4)
Payment of Premium provision
Non-forfeiture options for WL policy
14. Group plan initially self-funded by employer (like SIR); after which - group plan Insurer covers (up to policy limit); requires TPA.
Universal (aka Flexible Premium Adjustable) Life policy (2 of 4)
Employer-Administered plan
Endowment Life policy
Total disability (as commonly defined)
15. Provides 24 hr. health coverage both "on" & "off" job - but may cause coverage duplication & coordination challenges.
Claim Form (aka Proof of Loss Form) provision
24 Hour Coverage (CA)
Adverse selection
Plans A-L of Medical Supplement or Medigap
16. After 2-3 yrs. - Whole Life policy equity builds tax-deferred @ fixed interest rate until it equals death benefit; borrowable but taxable.
Concealment
Free Look provision
Cash value
Policy delivery
17. WL policy covering 2 or more Insureds but ONLY payable upon death of LAST Insured - generally low premium but high death benefit.
Point of Service plan
Reinsurance
Types of Insurers (by ownership)
Survivorship (aka "Last to die") policy
18. Upon death - death benefit is paid + the aggregate of cash value accumulated to date; add-on to WL policy ONLY.
Viatical Settlement Provider (VSP)
Return of Cash Value rider
Business Continuation (aka Buy-Sell) Disability policy
Civil Rights/Pregnancy Discrimination Act
19. Intentional deception; grounds for rescission.
Policy loans
Fraud
Universal (aka Flexible Premium Adjustable) Life policy (2 of 4)
Reinsurance
20. War - 2 types; Suicide (1st 2 yrs.); Aviation (non-commercial); Hazardous hobbies; Criminal acts; Alcohol/Drug influenced.
Common Life Exclusions
Transplant/Cosmetic Surgery rider
Current Assumption (aka Interest-Sensitive) Whole Life policy
Basic Medical plan
21. Provides for continued operation of business if partner dies - by allowing surviving partner(s) to buy deceased partner's interest in business.
Social Security Benefit (Supplement) rider
Grace Period provision
Types of Term Life policies
Business Continuation (aka Buy-Sell) policy
22. Financial interest in insured party that must exist @ time of application OR policy issuance. Requires consent (except minors).
Permanent vs. Temporary disability
24 Hour Coverage (CA)
Risk management
Insurable interest
23. Reappearance of disability w/in 6 mth. period after "recovery" from same disability is considered recurrence - not new disability.
Recurrent disability clause/provision
Major Medical plan
Errors & Omissions (E&O)
Insurable interest
24. Same as WL but premium low for set # yrs. - THEN premiums vary (+ or -) based on Insurer's investment returns - w/ Gmax.
Indeterminate Premium Whole Life policy
Health Maintenance Organization (HMO)
Types of Term Life policies
Beneficiary provisions
25. Extreme form of Limited Pay Whole Life whereby entire premium is paid in a single payment.
Guaranteed Insurability Life rider
Single Pay Whole Life policy
Estoppel
Reinsurance
26. PURELY employer-funded account to reimburse employees for qualified medical expenses not covered by group health plan.
Health Reimbursement Account (HRA)
Errors & Omissions (E&O)
Dread Disease policy
Payor (aka Waiver of Payor's Premium) rider
27. Provides for continued operation of business if partner becomes disabled - by allowing other partner(s) to buy disabled partner's interest in business.
Business Continuation (aka Buy-Sell) Disability policy
Considerations in replacing Health insurance
Cash value
Rehabilitation rider
28. 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.
Dividend options
Rate (as defined by CIC)
Penalties for violating AIDS/HIV privacy laws
29. To "make whole again" w/out benefit or detriment; neither monetary profit nor loss.
Key Employee Disability policy
Annuity surrender charges
Concealment
Indemnify
30. Same as WL but death benefit increases annually - linked to Consumer Price Index; premium increases annually OR is set high from start.
Types of Accident & Health insurance
Types of Insurers (by sector)
Equity Index Whole Life policy
Medicaid/Medi-Cal
31. 1: parties to contract; 2: insured party or life; 3: insurable interest - if 3rd party; 4: risks insured against; 5: policy period (term); 6: premium & mode.
Tax implications of an Estate
Valid life insurance contracts must identify...
Key Employee Disability policy
Family or Dependents rider
32. Prohibited w/ regard to testing for people of same class; test results must remain confidential; coverage may be declined (once discovered).
AIDS/HIV discrimination
Family Income policy
Premium modes
7 Pay Test
33. Expands individual WL policy to include Term Life for dependents (spouse - children - etc.).
Elements to contract
Family or Dependents rider
Blue Cross/Blue Shield
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
34. 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.
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
Beneficiary provisions
Types of Insurers (miscellaneous)
IRS Penalties for Annuities
35. Federal law to protect Federal employees' (& their beneficiaries') pension - group insurance - & welfare benefits.
Automatic Premium Loan (APL) provision
Key Employee Disability policy
Employee Retirement Income Security Act (ERISA)
Total disability (more restrictive definition)
36. Accumulation or "pay-in" - contributions & interest earned are tax-deferred; Annuity or "pay-out" - monthly annuity (taxable) paid.
Loss of Earnings Test
Phases of an annuity
Common Disability Exclusions
Payment of Premium provision
37. Commercial (private) companies; HMOs; PPOs; Blue Cross/Blue Shield; Employer-sponsored plans; Government.
Modified Endowment Contract (MEC)
Requirements to sell variable life products
Types of Accident & Health (A&H) providers
Universal (aka Flexible Premium Adjustable) Life policy (3 of 4)
38. Palliative - treatment to manage pain; Curative - treatment to cure illness/condition.
Accidental Death & Dismemberment (AD&D) Life policy
Tax implications of Death Benefit & Cash Value
Types of Insurers (by ownership)
Palliative vs. Curative care
39. Written contract to transfer risk of premature death from one party to another; pays stated sum upon death; creates instant estate.
Fraud
Types of hazards
Life insurance policy
Insuring clause/provision (aka Insuring Agreement)
40. Available for any reason up to full cash value @ fixed (max 8%) OR variable interest rate; loan $ + interest deducted from benefit @ death.
Types of Insurers (by sector)
Policy loans
Beneficiary provisions
Types of Renewability provisions
41. Plan A is the CORE benefit & is least expensive; All other plans include Plan A + additional benefits. Plans F & J are high deductible. K & L are both deductible & co-pay plans.
Dividend options
Waiver of Premium (Waiver of Cost of Insurance) rider
Loss exposure
Plans A-L of Medical Supplement or Medigap
42. Same as WL but w/ adjustable death benefit (& corresponding premium) & over-fund option but w/ annually renewable term (ART).
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
Adverse selection
Waiver of Premium provision
Medical Savings Account (MSA) & Health Savings Account (HSA)
43. Guaranteed min. interest rate on cash value buildup but possible higher rate if short-term investment returns higher than expected.
Universal (aka Flexible Premium Adjustable) Life policy (3 of 4)
Reinsurance
Annuity Classifications (1 of 5): How premium is paid
Limited Pay Whole Life policy
44. Conditional - coverage is conditional; Personal - parties are people; Good faith - honesty/integrity; Fiduciary - req's financial trust.
Insurance contract characteristics (2 of 2)
Accidental Death & Dismemberment (AD&D) Life policy
Cross Purchase Plan
Annuity Classifications (1 of 5): How premium is paid
45. Policy owner has right to determine mode of premium payment but Insurer can charge admin. fee if not annual.
Payment of Premium provision
Impairment (Exclusion) rider
Employer-Administered plan
Exclusions for Major Medical plan
46. Non-qualified Annuity - Non-deductible contributions & tax-deferred growth. At pay-out - tax-free principal but taxable growth.
Tax implications of an Annuity (1 of 2)
Types of Insurers (by sector)
Rate (as defined by CIC)
Tax implications of Death Benefit & Cash Value
47. Federal law which prohibits companies w/ 20+ employees from denying work & medical benefits to employees due to age.
Occupational Disability policy
Age Discrimination in Employment Act (ADEA)
Single Pay Whole Life policy
Variable Life policy (2 of 2)
48. Qualified Annuity - Tax-deductible contributions & tax-deferred growth but fully taxable w/drawals.
Insurance contract characteristics (1 of 2)
Tax implications of Disability policy
Long Term Care (LTC) policy
Tax implications of an Annuity (1 of 2)
49. Facultative - case by case agreements; Automatic/Treaty - automatic acceptance of risk percentage per previous agreement.
Business Continuation (aka Buy-Sell) Disability policy
Types of Insurers (miscellaneous)
Occupational Disability policy
Types of reinsurance
50. Although death benefit is tax-free - it is included in gross estate value so federal &/or state taxes may apply to a portion in excess of fixed federal limit.
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
Rehabilitation rider
Tax implications of an Estate
Spendthrift provision