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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. The state in which the contract is accepted or delivered is the state that possesses regulatory jurisdiction over Group plan.
Universal (aka Flexible Premium Adjustable) Life policy (4 of 4)
Tax implications of an Estate
Doctrine of Comity
Medicare Part C (aka Medicare Advantage)
2. Summary of coverage including premium & mode of payment - death benefit - beneficiary(ies) - exclusions - & promise to pay.
Social Security Benefit (Supplement) rider
Exclusions to Work. Comp.
Insuring clause/provision (aka Insuring Agreement)
Recurrent disability clause/provision
3. 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)
Medi-Cal Share Cost plan
Permanent vs. Temporary disability
Applicant Representations vs. Warranties
4. Process which prevents claim denial as a result of false statement or promise (made by Insurer) - which was relied upon by Insured.
Tax implications of Dividends - Loans & Interest
Estoppel
Palliative vs. Curative care
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
5. 1: Surrender for cash value (taxable); 2: Buy equal-benefit paid-up Level Term policy; 3: Buy reduced-benefit paid-up WL policy.
Flexible Spending Account (FSA)
Non-forfeiture options for WL policy
Types of Medical Plans
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
6. A lapsed policy may be reinstated if not longer than 3-5 yrs. - & proof of insurability re-established - & back premiums + interest paid.
Reinsurance
Key Employee Disability policy
Reinstatement provision
Blue Cross/Blue Shield
7. Written policy terms supersede oral statements made prior to policy issue.
Parole Pardon Rule
Annuity Classifications (2 of 5): When benefits begin
Annuity Classifications (4 of 5): Disposition "pay-out" of proceeds
Single Pay Whole Life policy
8. If total premiums paid w/in 1st 7 yrs. exceed net level premium that should have been paid - policy is an MEC.
Errors & Omissions (E&O)
Whole (aka Permanent or Straight) Life policy
Tax implications of Dividends - Loans & Interest
7 Pay Test
9. Mortality is the statistical possibility of death @ each age. Morbidity is the statistical possibility & extent of disability @ each age.
Point of Service plan
Mortality vs. Morbidity tables
Underwriting risk categories
Medi-Cal Share Cost plan
10. Upon death - death benefit is paid + the aggregate of premiums paid to date; add-on to Term policy ONLY.
Workers' Compensation insurance
Return of Premium rider
Indeterminate Premium Whole Life policy
Variable Life policy (1 of 2)
11. Prohibited w/ regard to testing for people of same class; test results must remain confidential; coverage may be declined (once discovered).
Survivorship (aka "Last to die") policy
AIDS/HIV discrimination
Single Pay Whole Life policy
Relation of Earnings to Insurance provision
12. Tendency of poorer risks to seek insurance.
Accidental Death (aka Multiple Indemnity) rider
Dependent coverage
Dividends
Adverse selection
13. Policy provisions must conform to state regulations where policy is sold.
Reinsurance
Entire Contract provision
Blackout Period
Conformity with State Statute provision
14. 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;
Types of Insurers (by domicile)
CHAMPUS (aka TriCare)
Social Security (aka Old Age Survivors Disability Health Insurance or OASDHI)
Universal (aka Flexible Premium Adjustable) Life policy (2 of 4)
15. Provides medical & personal services for people needing extended assistance w/ Activities of Daily Living (ADL). Other benefits include: assisted living care; respite care; hospice care; adult day care.
Enhanced Ordinary (aka Extraordinary) Whole Life policy
Types of Insurers (by domicile)
Long Term Care (LTC) policy
Comprehensive Major Medical plan
16. Disability income is based on "earned income" (salary - bonus - commission) - not unearned income (interest - investment - rents).
Loss of Earnings Test
Types of Insurers (by ownership)
Residual disability rider
Tax implications of medical plans
17. Pays death benefit until age 100 or death; builds equity (cash value); may be transferred or sold; generally level premium.
Valid life insurance contracts must identify...
Free Look provision
Whole (aka Permanent or Straight) Life policy
Insurance contract characteristics (2 of 2)
18. Non-qualified Annuity - Non-deductible contributions & tax-deferred growth. At pay-out - tax-free principal but taxable growth.
Workers' Compensation insurance
Tax implications of an Annuity (1 of 2)
Non-forfeiture options for WL policy
Medicaid/Medi-Cal
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.
Medi-Cal Share Cost plan
Cash value
Exclusions to Work. Comp.
Tax implications of medical plans
20. Price of insurance per exposure unit.
Rate (as defined by CIC)
Dividend options
Impairment (Exclusion) rider
Parole Pardon Rule
21. Benefits automatically increase annually based on inflationary index (i.e. Consumer Price Index) OR flat rate (5% max.).
Non-Occupational Disability policy
Dependent coverage
Family Income policy
Cost of Living Adjustment (COLA) Disability rider
22. Compensates business for loss due to death or disability of key employee; premiums not deductible but benefits tax-free.
Types of Accident & Health (A&H) providers
Rehabilitation rider
Key Employee policy
Dental Plan
23. 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.
Types of hazards
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
Beneficiary provisions
Departments of an Insurer
24. Specialized policy covering diagnostic & preventative dental care; often no deductible; co-insurance; expensive; may be included w/ medical plan.
Requirements to sell variable life products
Survivorship (aka "Last to die") policy
Annuity Classifications (5 of 5): # of lives
Dental Plan
25. Underwriting - determines insurability; Marketing/Sales - determines products; Actuarial - determines rates; Claims - investigates/pays claims.
Departments of an Insurer
Types of hazards
Plans A-L of Medical Supplement or Medigap
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
26. Dependent children are covered until 19 or 23 (full-time student only) or until self-sufficient (if handicapped).
Trial Application (aka Request for Offer)
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
Dependent coverage
27. Federally-funded but state-run program for truly indigent individuals & families providing medical care at Federal clinic.
Partial disability rider
Medicaid/Medi-Cal
Occupational Disability policy
Common Accident provision
28. Palliative - treatment to manage pain; Curative - treatment to cure illness/condition.
Survivorship (aka "Last to die") policy
Enhanced Ordinary (aka Extraordinary) Whole Life policy
Incontestability clause/provision
Palliative vs. Curative care
29. 1: Immediate benefits rec'd w/in 30 days but premium must be paid by lump sum; 2: Deferred - usually until retirement.
Annuity Classifications (2 of 5): When benefits begin
Key Employee Disability policy
Insurer (as defined by CIC)
Universal (aka Flexible Premium Adjustable) Life policy (4 of 4)
30. Voiding an insurance contract based on fraud - concealment or material misrepresentation; premiums returned; policy treated as never existing.
24 Hour Coverage (CA)
Rescission
Employer Liability
Occupational Disability policy
31. An unintentional mistake committed by an insurance representative; may be covered by E&O insurance.
Underwriting risk categories
Errors & Omissions (E&O)
Insurer (as defined by CIC)
Dread Disease policy
32. Unintentional - up to $1 -000 + legal $; Intentional - $1 -000-5 -000 + legal $; If harmful - misdemeanor + up to 1 yr. prison + up to $10 -000.
Guaranteed Insurability Life rider
Penalties for violating AIDS/HIV privacy laws
Credit Life policy
Waiver of Premium (Waiver of Cost of Insurance) rider
33. 'The inability to perform ANY gainful occupation'.
Entire Contract provision
Dividend options
Total disability (any-occupational definition)
Cost of Living Adjustment (COLA) Disability rider
34. Same as Comprehensive Major Medical but w/ integrated deductible; much more expensive.
Business Continuation (aka Buy-Sell) policy
Supplemental Major Medical plan
Disability Income policy
Flexible Spending Account (FSA)
35. Actual/Expressed - written powers; Implied - unwritten but customary practices; Apparent - perceived powers.
Types of Insurers (by sector)
Types of Agency Authority
Estoppel
Accidental Death & Dismemberment (AD&D) Life policy
36. Agents - represent Insurer; Brokers - represent themselves & Insured; Solicitors - represent one agent to solicit leads.
Payment of Premium provision
Types of Licensed Producers
Transplant/Cosmetic Surgery rider
Current Assumption (aka Interest-Sensitive) Whole Life policy
37. Same as WL but death benefit decreases each yr. w/ dividends paid annually to offset decrease.
Factors that determine premium
Recurrent disability clause/provision
Business Overhead Expense (BOE) Disability policy
Enhanced Ordinary (aka Extraordinary) Whole Life policy
38. Pre-existing illness/injury; Waiting period; Elimination period; Probationary period; Benefits - Exclusions - Limitations; Underwriting reqs.
Considerations in replacing Health insurance
Factors that determine premium
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
Relation of Earnings to Insurance provision
39. Partially state-funded benefits for low-income people whereby cost of care is shared between state & recipient - based on income.
Major Medical plan
Medi-Cal Share Cost plan
Rescission
Waiver of Premium (Waiver of Cost of Insurance) rider
40. Death benefits & premium automatically increase annually based on inflationary index (i.e. Consumer Price Index).
24 Hour Coverage (CA)
Return of Premium rider
Cost of Living Adjustment (COLA) Life rider
Key Employee policy
41. Insurance purchased by other Insurer(s) to spread or diversify risk; promotes industry stability.
Joint Life (aka "First to die") policy
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
Reinsurance
Errors & Omissions (E&O)
42. Provides accidental death benefit @ full $ of "principal sum". Dismemberment is paid only @ 50% principal sum ("capital sum").
Key Employee Disability policy
Family Maintenance policy
Earned vs. Unearned premium
Accidental Death & Dismemberment (AD&D) Life policy
43. Insurer has right to rescind policy & return premium if material misrepresentation in application is found w/in 1st 2 yrs.
Common Accident provision
Mortality vs. Morbidity tables
Insurance contract characteristics (2 of 2)
Incontestability clause/provision
44. Temp. coverage for set duration w/ death benefit ONLY (no cash value) - offers largest $ for lowest premium; renewable; convertible.
Annuity Classifications (1 of 5): How premium is paid
Settlement options for Life policy (1 of 2)
Term Life policy
Split Dollar Plan
45. Basic Medical; Major Medical; Comprehensive Major Medical
Split Dollar Plan
Rescission
Types of Medical Plans
Social Security Benefit (Supplement) rider
46. Policy owner has right to determine mode of premium payment but Insurer can charge admin. fee if not annual.
Types of reinsurance
Payment of Premium provision
Concealment exceptions
Claim Form (aka Proof of Loss Form) provision
47. Allows Insured to increase benefit w/out medical exam (subject to age max.) w/ additional premium rate determined @ attained age; must prove income increase.
Juvenile Life (aka Jumping Juvenile) policy
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
Small Employer Medical Expense plan
Modified Premium Whole Life policy
48. 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.
Insurer (as defined by CIC)
Types of Medical Plans
Supplemental Major Medical plan
Partial disability rider
49. Combination of Basic Medical & Major Medical in one policy; Basic pays 1st - then Major Medical w/ corridor deductible.
Presumptive disability
Comprehensive Major Medical plan
Needs approach (most common)
Retrocession
50. Covers entire family w/ WL for breadwinner & (convertible) Level Term for spouse & children (until certain age).
Family policy
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
Exclusions to Work. Comp.
Peril vs. Hazard