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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. Same as Comprehensive Major Medical but w/ integrated deductible; much more expensive.
Supplemental Major Medical plan
Single Pay Whole Life policy
Loss exposure
Annuity Classifications (1 of 5): How premium is paid
2. Experience - rates impacted by actual prior claim experience of actual group; Community - identical rates used for entire community - regardless of experience.
Types of Renewability provisions
Key Employee policy
Experience vs. Community rating in Group Health plan
Medi-Cal Share Cost plan
3. Part A - Inpatient hospital deductibles vary on # of days; limited reserve days; finite benefit; 1st 3 pints blood; Part B - 20% co-payment.
Multiple Employer Trust (MET) aka Multiple Employer Welfare Association (MEWA)
Dependent coverage
Medicare Part A & B "Gaps"
Earned vs. Unearned premium
4. Federal law which allows health coverage portability when changing jobs - so long as previous coverage was in effect 63+ days; allows some tax deductibility for LTC.
Impairment (Exclusion) rider
Health Insurance Portability and Accountability Act (HIPAA)
Entire Contract provision
Survivorship (aka "Last to die") policy
5. Price of insurance per exposure unit.
Employer Liability
Tax implications of Disability policy
Annuity Classifications (3 of 5): Source of income
Rate (as defined by CIC)
6. Unilateral - Insurer provides contract; Adhesion - parties must adhere to terms; Aleatory - benefits may not inure equally.
Reinstatement provision
Insurance contract characteristics (1 of 2)
Types of Accident & Health (A&H) providers
Viatical Settlement Provider (VSP)
7. After 2-3 yrs. - Whole Life policy equity builds tax-deferred @ fixed interest rate until it equals death benefit; borrowable but taxable.
Loss exposure
Cash value
Loss of Earnings Test
Time Limit on Certain Defenses provision
8. Provides for continued operation of business if partner becomes disabled - by allowing other partner(s) to buy disabled partner's interest in business.
CA Work. Comp. Statutes
Partial disability rider
Occupational Disability policy
Business Continuation (aka Buy-Sell) Disability policy
9. IRS allows tax-free transfer of cash values between 2 LIKE policies (i.e. Life to Life - Annuity to Annuity - or Life to Annuity).
Key Employee Disability policy
1035 Exchange
AIDS/HIV discrimination
Total disability (any-occupational definition)
10. Accumulation or "pay-in" - contributions & interest earned are tax-deferred; Annuity or "pay-out" - monthly annuity (taxable) paid.
Modified Endowment Contract (MEC)
Phases of an annuity
Business Continuation (aka Buy-Sell) Disability policy
Types of Medical Plans
11. 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.
Medicare Part A (aka Hospital Insurance or HI)
Employee Retirement Income Security Act (ERISA)
Legal Action provision
Applicant Representations vs. Warranties
12. Insurer has right to adjust (+ or -) death benefit if age or sex is misstated but normally doesn't void policy.
Blackout Period
Misstatement of Age/Sex provision
Disability Income policy
Underwriting risk categories
13. Same as Universal Life but cash value put in investment vehicles chosen by policy owner (stocks - bonds - munis.); cash value NOT guaranteed.
Variable Universal Life policy
Life insurance policy
Current Assumption (aka Interest-Sensitive) Whole Life policy
Market Value Adjusted (aka Modified Guaranteed) annuity
14. Basic Medical; Major Medical; Comprehensive Major Medical
Types of Medical Plans
Insuring clause/provision (aka Insuring Agreement)
24 Hour Coverage (CA)
Return of Premium rider
15. Monthly; Quarterly; Semi-annually; Annually (cheapest due to less admin cost).
Insurance contract characteristics (1 of 2)
Tax implications of Dividends - Loans & Interest
Premium modes
Risk management
16. Death benefit determined by Insured's projected lost earnings potential.
Cost of Living Adjustment (COLA) Life rider
Human Life Value approach
Types of Insurers (miscellaneous)
Types of hazards
17. Upon death - death benefit is paid + the aggregate of cash value accumulated to date; add-on to WL policy ONLY.
Transplant/Cosmetic Surgery rider
Return of Cash Value rider
Key Employee Disability policy
Annuity surrender charges
18. 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)
Enhanced Ordinary (aka Extraordinary) Whole Life policy
Common Disaster (Simultaneous Death Act) clause/provision
Recurrent disability clause/provision
19. Authorized (admitted) - can conduct business in state; Unauthorized (non-admitted) - cannot conduct business in state (w/ one exception).
Whole (aka Permanent or Straight) Life policy
Types of Insurers (by authorization)
Equity Indexed annuity
Endowment Life policy
20. Govt. organization providing health care benefits for dependents of military personnel.
Change of Occupation provision
Tax implications of Death Benefit & Cash Value
Needs approach (most common)
CHAMPUS (aka TriCare)
21. To "make whole again" w/out benefit or detriment; neither monetary profit nor loss.
Viatical Settlement Provider (VSP)
Indemnify
Retrocession
Tax implications of an Annuity (1 of 2)
22. No-cost provision that authorizes Insurer to borrow from cash value to pay unpaid premiums after grace period; must ask for @ app. time.
Automatic Premium Loan (APL) provision
Workers' Compensation insurance
Incontestability clause/provision
Types of Accident & Health insurance
23. PURELY employer-funded account to reimburse employees for qualified medical expenses not covered by group health plan.
Health Reimbursement Account (HRA)
Time Limit on Certain Defenses provision
Departments of an Insurer
Entire Contract provision
24. Prepaid med. benefits for "subscribers" @ approved facilities; many non-profit; Blue Cross - Hospital stays; Blue Shield - M.D. costs.
Blue Cross/Blue Shield
Relation of Earnings to Insurance provision
Employer Liability
Free Look provision
25. Req. by CA statute & may provide workers coverage for action-over claims.
Rate (as defined by CIC)
Renewability provision
Entire Contract provision
Employer Liability
26. Policy owner must notify Insurer of loss either in writing - in person or by phone w/in 20 days.
Types of Accident & Health (A&H) providers
Accidental Death & Dismemberment (AD&D) Life policy
Return of Cash Value rider
Notice of Claim provision
27. Receipt whereby coverage incepts immediately upon submission of full consideration - unless declined & premium refunded.
Beneficiary provisions
Plans A-L of Medical Supplement or Medigap
Dividend options
Binding receipt (aka Temporary Insurance Agreement)
28. 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.
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
Business Continuation (aka Buy-Sell) policy
Beneficiary provisions
Point of Service plan
29. Pays death benefit until age 100 or death; builds equity (cash value); may be transferred or sold; generally level premium.
Non-forfeiture options for WL policy
Accidental Death & Dismemberment (AD&D) Disability rider
Annuity Classifications (1 of 5): How premium is paid
Whole (aka Permanent or Straight) Life policy
30. A&H - A&S - Sickness only; Medical; Disability; Accident only; Travel accident; LTC; Medicare supplement; AD&D; Dental/Vision/Prescription; Limited.
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
Types of Accident & Health insurance
Legal Action provision
Medi-Cal Share Cost plan
31. Physical - slippery floor; Moral - dishonest acts; Morale - carelessness or recklessness.
Types of hazards
Point of Service plan
Family policy
Age Discrimination in Employment Act (ADEA)
32. A lapsed policy may be reinstated if not longer than 3-5 yrs. - & proof of insurability re-established - & back premiums + interest paid.
Reinstatement provision
IRS Penalties for Annuities
Supplemental Major Medical plan
Binding receipt (aka Temporary Insurance Agreement)
33. An unintentional mistake committed by an insurance representative; may be covered by E&O insurance.
Small Employer Medical Expense plan
Errors & Omissions (E&O)
Risk management
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
34. Mortality is the statistical possibility of death @ each age. Morbidity is the statistical possibility & extent of disability @ each age.
Total disability (as commonly defined)
Mortality vs. Morbidity tables
Single Pay Whole Life policy
Waiver of Premium provision
35. Allows Insured to increase benefit w/out medical exam (subject to age max.) w/ additional premium rate determined @ attained age; must prove income increase.
Medicare Part C (aka Medicare Advantage)
Workers' Compensation insurance
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
Accidental Death & Dismemberment (AD&D) Life policy
36. Grows @ fixed min. interest rate but w/ possible higher rate tied to equity index (i.e S&P Equity Index) appreciation; gains shared w/ Insurer.
Single Pay Whole Life policy
Legal Action provision
Equity Indexed annuity
Juvenile Life (aka Jumping Juvenile) policy
37. Potential circumstance that could cause a loss; measured in dollars.
Misstatement of Age/Sex provision
Notice of Claim provision
Loss exposure
Experience vs. Community rating in Group Health plan
38. Coverage for catastrophic loss w/ high limits - front end deductible; co-insurance (80/20%); blanket coverage; stop loss max.
Major Medical plan
Change of Occupation provision
Basic Medical plan
Types of Renewability provisions
39. 'The inability to perform ANY gainful occupation'.
Whole (aka Permanent or Straight) Life policy
Palliative vs. Curative care
Variable Life policy (2 of 2)
Total disability (any-occupational definition)
40. Prepaid med. benefits for members ONLY w/ approved primary care M.D. (HMO employee); focus on preventative care; low co-pay.
Employee Retirement Income Security Act (ERISA)
Blue Cross/Blue Shield
Health Maintenance Organization (HMO)
Recurrent disability clause/provision
41. Must be delivered in person or by certified - registered or 1st-class mail w/ signature - unless waived by Insurance Commissioner.
Annuity surrender charges
Trusts
Policy delivery
Beneficiary provisions
42. Savings account for medical expenses; Tax-deductible contributions; tax-deferred growth; tax-free for qualified use; taxable for non-qualified use.
Medi-Cal Share Cost plan
Types of reinsurance
Types of Accident & Health insurance
Medical Savings Account (MSA) & Health Savings Account (HSA)
43. Combination of Basic Medical & Major Medical in one policy; Basic pays 1st - then Major Medical w/ corridor deductible.
Tax implications of medical plans
Juvenile Life (aka Jumping Juvenile) policy
Insurable interest
Comprehensive Major Medical plan
44. Provides accidental death benefit @ full $ of "principal sum". Dismemberment is paid only @ 50% principal sum ("capital sum").
Workers' Compensation insurance
Accidental Death & Dismemberment (AD&D) Disability rider
Common Disability Exclusions
Legal Action provision
45. Receipt whereby coverage incepts ONLY after underwriting approval.
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
Approval Type Conditional receipt
Waiver of Premium provision
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
46. Period of time following any children's survivor benefit & before benefits are provided to employee's widow/widower.
Blackout Period
Cost of Living Adjustment (COLA) Disability rider
Waiver of Premium (Waiver of Cost of Insurance) rider
Waiver of Premium provision
47. 1: Surrender for cash value (taxable); 2: Buy equal-benefit paid-up Level Term policy; 3: Buy reduced-benefit paid-up WL policy.
Legal Action provision
Doctrine of Comity
Non-forfeiture options for WL policy
Blackout Period
48. Treating or mitigating loss exposures through 1: avoidance; 2: retention (deductibles); 3: sharing; 4: reduction; or 5: transfer.
Business Continuation (aka Buy-Sell) Disability policy
Term Life policy
Risk management
Types of Agency Authority
49. Federally-sponsored health care for individuals 65+ &/or w/ certain disabilities; may run concurrent w/ group plan but group plan would act primary - THEN Medicare.
Civil Rights/Pregnancy Discrimination Act
Annuity Classifications (3 of 5): Source of income
Renewability provision
Medicare
50. Generally 10 days after policy delivery to cancel policy w/ full refund - except 30 days for seniors or for replacement policies.
Blue Cross/Blue Shield
Free Look provision
Annuity Classifications (3 of 5): Source of income
Spendthrift provision