Test your basic knowledge |

CA Life Agent Exam

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. Disability income is based on "earned income" (salary - bonus - commission) - not unearned income (interest - investment - rents).






2. Provides increased death benefit if death occurs w/in 90 days & as result of accident; relatively INexpensive add-on.






3. Time period preceding each disability during which benefits are not paid; longer elimination periods = cheaper premium.






4. Summary of coverage including premium & mode of payment - death benefit - beneficiary(ies) - exclusions - & promise to pay.






5. Basic Medical; Major Medical; Comprehensive Major Medical






6. Generally 10 days after policy delivery to cancel policy w/ full refund - except 30 days for seniors or for replacement policies.






7. 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.






8. 4: Funds retained by Insurer until w/drawn - interest ONLY paid monthly (taxable); 5: Paid-up immediate annuity.






9. Taxable income (unlike individual plans); can be either short-term - 13-52 wks. max. or long-term - longer than 52 wks.






10. Physical - slippery floor; Moral - dishonest acts; Morale - carelessness or recklessness.






11. Unilateral - Insurer provides contract; Adhesion - parties must adhere to terms; Aleatory - benefits may not inure equally.






12. Domestic - within home state; Foreign - outside home state; Alien - outside home country.






13. Same as WL but premium low for 1st 5 yrs. - THEN has annual premium increases for set # yrs. - THEN level premium.






14. Palliative - treatment to manage pain; Curative - treatment to cure illness/condition.






15. Same as WL but w/ Level Term rider; upon death - pays monthly income for FULL term AFTER which pays full death benefit.






16. 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.






17. Upon death - death benefit is paid + the aggregate of premiums paid to date; add-on to Term policy ONLY.






18. Guaranteed min. interest rate on cash value buildup but possible higher rate if short-term investment returns higher than expected.






19. Annuity distributions prior to age 59 1/2 incur a 10% IRS penalty EXCEPT for death - disability - immediate annuity - or rollover.






20. War; elective cosmetic surgery; routine dental; work. comp.-covered claims; self-inflicted (intentional); gov't. facility treatment; LTC; private nursing.






21. Provides supplemental coverage for physician/surgeon fees if enrolled (during enrollment period ONLY) & pay monthly premium w/ deductible and co-insurance.






22. Responsible adult trustee designated to manage death benefits for minor child beneficiary until adulthood.






23. Waives premium on Life policy for minor child until age 21 in event premium payor dies or becomes disabled.

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24. PURELY employer-funded account to reimburse employees for qualified medical expenses not covered by group health plan.






25. Written contract to transfer risk of premature death from one party to another; pays stated sum upon death; creates instant estate.






26. Group plan initially self-funded by employer (like SIR); after which - group plan Insurer covers (up to policy limit); requires TPA.






27. 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.






28. 1: Immediate benefits rec'd w/in 30 days but premium must be paid by lump sum; 2: Deferred - usually until retirement.






29. After 2-3 yrs. - Whole Life policy equity builds tax-deferred @ fixed interest rate until it equals death benefit; borrowable but taxable.






30. Fixed premium w/ guaranteed min. death benefit that may increase due to higher than expected investment returns.






31. Provides disability income during surgery recovery from life-threatening condition (& sometimes cosmetic surgery).






32. 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.






33. Allows for Term policy renewal @ higher premium w/out medical exam; guarantees insurability; based on actual/attained age.






34. Provides % of monthly income benefit if Insured becomes disabled due to illness or accident.






35. 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






36. Price of insurance per exposure unit.






37. Same as WL but death benefit increases annually - linked to Consumer Price Index; premium increases annually OR is set high from start.






38. Mathematical law stating the larger # of occurrences - the more predictable the losses; used to calculate premiums.






39. Revocable - changeable anytime w/ Change of Beneficiary Form; Irrevocable - not changeable w/out beneficiary permission.






40. Benefits automatically increase annually based on inflationary index (i.e. Consumer Price Index) OR flat rate (5% max.).






41. Part A - Inpatient hospital deductibles vary on # of days; limited reserve days; finite benefit; 1st 3 pints blood; Part B - 20% co-payment.






42. Provides for continued operation of business if partner becomes disabled - by allowing other partner(s) to buy disabled partner's interest in business.






43. Req. by CA statute & may provide workers coverage for action-over claims.






44. 1: Tax-free lump sum; 2: Monthly pay-outs for fixed time; 3: Fixed monthly payments until depleted.






45. 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.






46. Written contract that provides INCOME @ high interest rate for fixed period OR for annuitant's lifetime w/ possible death benefit.






47. Provides accidental death benefit @ full $ of "principal sum". Dismemberment is paid only @ 50% principal sum ("capital sum").






48. Qualified Annuity - Tax-deductible contributions & tax-deferred growth but fully taxable w/drawals.






49. Agents - represent Insurer; Brokers - represent themselves & Insured; Solicitors - represent one agent to solicit leads.






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.