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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. Process which prevents claim denial as a result of false statement or promise (made by Insurer) - which was relied upon by Insured.
Types of Insurers (by domicile)
Insurance contract characteristics (2 of 2)
Estoppel
Transplant/Cosmetic Surgery rider
2. Same as WL but w/ adjustable death benefit (& corresponding premium) & over-fund option but w/ annually renewable term (ART).
Beneficiary provisions
Accidental Death & Dismemberment (AD&D) Life policy
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
Residual disability rider
3. Compensates business for loss due to disability of key employee; premiums not deductible but benefits tax-free.
Total disability (more restrictive definition)
Cash value
Waiver of Premium (Waiver of Cost of Insurance) rider
Key Employee Disability policy
4. 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.
Types of Licensed Producers
COBRA Time Limitations
Premium modes
Accidental Death & Dismemberment (AD&D) Life policy
5. 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.
Current Assumption (aka Interest-Sensitive) Whole Life policy
Plans A-L of Medical Supplement or Medigap
Family Maintenance policy
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
6. Physical - slippery floor; Moral - dishonest acts; Morale - carelessness or recklessness.
Types of hazards
AIDS/HIV discrimination
Estoppel
Limited Pay Whole Life policy
7. Fixed premium w/ guaranteed min. death benefit that may increase due to higher than expected investment returns.
Variable Life policy (2 of 2)
Workers' Compensation insurance
Types of Insurers (by authorization)
Rehabilitation rider
8. Disability policy rider covering "the inability to perform some - but not all of your duties"; pays max. 50% of disability benefit for up to 6 mths.
Partial disability rider
Comprehensive Major Medical plan
Workers' Compensation insurance
Tax implications of medical plans
9. Permanent disability due to total loss of sight - hearing - speech or use of 2 + limbs; benefits paid even while continuing to work.
AIDS/HIV discrimination
Renewability provision
Approval Type Conditional receipt
Presumptive disability
10. Guaranteed min. interest rate on cash value buildup but possible higher rate if short-term investment returns higher than expected.
Family Maintenance policy
Recurrent disability clause/provision
Levels of Long Term Care provided
Universal (aka Flexible Premium Adjustable) Life policy (3 of 4)
11. Policy owner has right to determine mode of premium payment but Insurer can charge admin. fee if not annual.
IRS Penalties for Annuities
Waiver of Premium (Waiver of Cost of Insurance) rider
Payment of Premium provision
Civil Rights/Pregnancy Discrimination Act
12. Policy owner must notify Insurer of loss either in writing - in person or by phone w/in 20 days.
Notice of Claim provision
Dividend options
Rate (as defined by CIC)
Mortality vs. Morbidity tables
13. Any person - assoc. - org. - partnership - business trust - LLC - or corp. capable of making an insurance contract.
Universal (aka Flexible Premium Adjustable) Life policy (2 of 4)
Claim Form (aka Proof of Loss Form) provision
Binding receipt (aka Temporary Insurance Agreement)
Insurer (as defined by CIC)
14. Application submitted w/out premium; no coverage until submission of full consideration & completed Statement of Continued Good Health.
Types of Agency Authority
Notice of Claim provision
Trial Application (aka Request for Offer)
Exclusions to Work. Comp.
15. No-charge annuity w/drawals allowed up to 10% of total - THEN penalized on sliding scale based on # policy yrs.; conditionally waived.
Annuity surrender charges
Split Dollar Plan
Residual disability rider
Grace Period provision
16. Type of partial disability rider - which pays fluctuating % of lost income w/out time limit.
Residual disability rider
Flexible Spending Account (FSA)
Waiver of Premium provision
Variable Universal Life policy
17. An unintentional mistake committed by an insurance representative; may be covered by E&O insurance.
Common Life Exclusions
Errors & Omissions (E&O)
Impairment (Exclusion) rider
Loss exposure
18. Written policy terms supersede oral statements made prior to policy issue.
Reinstatement provision
Parole Pardon Rule
Variable Universal Life policy
Current Assumption (aka Interest-Sensitive) Whole Life policy
19. Unilateral - Insurer provides contract; Adhesion - parties must adhere to terms; Aleatory - benefits may not inure equally.
Departments of an Insurer
Free Look provision
Insurance contract characteristics (1 of 2)
Primary Insurance Amount (PIA)
20. Prevents overinsuring in order to profit from disability by coordinating benefits between Insurers.
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
Relation of Earnings to Insurance provision
Considerations in replacing Health insurance
Types of Insurers (miscellaneous)
21. Agreement - Offer & acceptance; Consideration - application + premium; Legal capacity - licensed &/or competent; Legal purpose - public good.
Accidental Death & Dismemberment (AD&D) Life policy
Annuity Classifications (2 of 5): When benefits begin
Employer Liability
Elements to contract
22. Provides disability income during surgery recovery from life-threatening condition (& sometimes cosmetic surgery).
Occupational Disability policy
Transplant/Cosmetic Surgery rider
Key Employee policy
Business Overhead Expense (BOE) Disability policy
23. 'The inability to perform your OWN normal occupation or daily duties'.
Occupational Disability policy
Small Employer Medical Expense plan
Plans A-L of Medical Supplement or Medigap
Total disability (as commonly defined)
24. Group plan initially self-funded by employer (like SIR); after which - group plan Insurer covers (up to policy limit); requires TPA.
Family Maintenance policy
Small Employer Medical Expense plan
Employer-Administered plan
Accidental Death & Dismemberment (AD&D) Life policy
25. If Insured changes to: more hazardous job - benefits reduced; less hazardous job - premiums reduce.
Change of Occupation provision
Types of Insurers (miscellaneous)
Social Security Benefit (Supplement) rider
Annuity Classifications (5 of 5): # of lives
26. Hybrid of HMO & PPO w/ greater flexibility on choosing specialists outside network w/ benefits still provided but @ higher co-pay.
Dread Disease policy
Impairment (Exclusion) rider
Types of Renewability provisions
Point of Service plan
27. Level - fixed death benefit - premium fixed until renewal; Decreasing - death benefit decreases over term - premium fixed until renewal; Increasing - death benefit increases over term - premium fixed until renewal.
Permanent vs. Temporary disability
Universal (aka Flexible Premium Adjustable) Life policy (4 of 4)
Types of Term Life policies
24 Hour Coverage (CA)
28. Peril is the CAUSE of loss. Hazard is a condition that increases LIKELIHOOD of loss.
Parole Pardon Rule
Key Employee Disability policy
Peril vs. Hazard
Types of Renewability provisions
29. Unintentional - up to $1 -000 + legal $; Intentional - $1 -000-5 -000 + legal $; If harmful - misdemeanor + up to 1 yr. prison + up to $10 -000.
Penalties for violating AIDS/HIV privacy laws
Insurable interest
Total disability (more restrictive definition)
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
30. Grows @ fixed interest rate for set term but cash value may adjust to prevailing rate (+ or -) if fully surrendered before term ends; % w/drawal ok.
Juvenile Life (aka Jumping Juvenile) policy
Market Value Adjusted (aka Modified Guaranteed) annuity
Phases of an annuity
Human Life Value approach
31. Identical to Incontestable Clause in Life policy.
Time Limit on Certain Defenses provision
24 Hour Coverage (CA)
Equity Index Whole Life policy
Insurable interest
32. Prepaid med. benefits for "subscribers" @ approved facilities; many non-profit; Blue Cross - Hospital stays; Blue Shield - M.D. costs.
Limited Pay Whole Life policy
Indemnify
Blue Cross/Blue Shield
Free Look provision
33. Receipt whereby coverage incepts immediately upon submission of full consideration - unless declined & premium refunded.
Family or Dependents rider
Common Accident provision
Binding receipt (aka Temporary Insurance Agreement)
Graded Premium Whole Life policy
34. Policy provisions must conform to state regulations where policy is sold.
Conformity with State Statute provision
Universal (aka Flexible Premium Adjustable) Life policy (4 of 4)
Penalties for violating AIDS/HIV privacy laws
Relation of Earnings to Insurance provision
35. Conditional - coverage is conditional; Personal - parties are people; Good faith - honesty/integrity; Fiduciary - req's financial trust.
Revocable vs. Irrevocable beneficiary
Insurance contract characteristics (2 of 2)
Residual disability rider
Disability Income policy
36. PURELY employer-funded account to reimburse employees for qualified medical expenses not covered by group health plan.
Considerations in replacing Health insurance
Health Reimbursement Account (HRA)
Palliative vs. Curative care
Accidental Death (aka Multiple Indemnity) rider
37. Commercial (private) companies; HMOs; PPOs; Blue Cross/Blue Shield; Employer-sponsored plans; Government.
Types of Licensed Producers
Split Dollar Plan
Medical cost containment (aka Managed care)
Types of Accident & Health (A&H) providers
38. Taxable income (unlike individual plans); can be either short-term - 13-52 wks. max. or long-term - longer than 52 wks.
Joint Life (aka "First to die") policy
Approval Type Conditional receipt
Group Disability plan
Permanent vs. Temporary disability
39. If total premiums paid w/in 1st 7 yrs. exceed net level premium that should have been paid - policy is an MEC.
Types of Term Life policies
Small Employer Medical Expense plan
Types of Accident & Health (A&H) providers
7 Pay Test
40. Multiple small employers w/ common affiliation (trade assoc. OR Chamber of Commerce) band together to purchase group plan.
Life insurance policy
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
Split Dollar Plan
Dread Disease policy
41. 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;
Settlement options for Life policy (2 of 2)
Types of Insurers (by domicile)
Social Security (aka Old Age Survivors Disability Health Insurance or OASDHI)
Mortality vs. Morbidity tables
42. 'The inability to perform ANY reasonable occupation based on education - training or experience'.
Total disability (more restrictive definition)
Reinsurance
Medical cost containment (aka Managed care)
Approval Type Conditional receipt
43. 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
Concealment
Waiver of Premium (Waiver of Cost of Insurance) rider
44. Prepaid med. benefits for members ONLY w/ approved primary care M.D. (HMO employee); focus on preventative care; low co-pay.
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
Doctrine of Comity
Palliative vs. Curative care
Health Maintenance Organization (HMO)
45. Combination of Basic Medical & Major Medical in one policy; Basic pays 1st - then Major Medical w/ corridor deductible.
Comprehensive Major Medical plan
Civil Rights/Pregnancy Discrimination Act
Requirements to sell variable life products
Beneficiary provisions
46. 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.
Business Overhead Expense (BOE) Disability policy
Legal Action provision
Business Continuation (aka Buy-Sell) policy
Retrocession
47. Refund of 50-80% of premium (minus claims paid) every 5-10 yrs. OR age 65; expensive!
Exclusions to Work. Comp.
Age Discrimination in Employment Act (ADEA)
Return of Premium rider
Suicide clause/provision
48. 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
Beneficiary provisions
Medical Savings Account (MSA) & Health Savings Account (HSA)
Grace Period provision
Annuity Classifications (4 of 5): Disposition "pay-out" of proceeds
49. Same as WL but death benefit decreases each yr. w/ dividends paid annually to offset decrease.
Joint Life (aka "First to die") policy
Supplemental Major Medical plan
Major Medical plan
Enhanced Ordinary (aka Extraordinary) Whole Life policy
50. Price of insurance per exposure unit.
Loss of Earnings Test
Rate (as defined by CIC)
Occupational Disability policy
Suicide clause/provision