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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. Govt. organization providing health care benefits for dependents of military personnel.
Residual disability rider
Preferred Provider Organization (PPO)
Insurability Type Conditional receipt
CHAMPUS (aka TriCare)
2. Available for any reason up to full cash value @ fixed (max 8%) OR variable interest rate; loan $ + interest deducted from benefit @ death.
Cross Purchase Plan
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
Policy loans
Health Insurance Portability and Accountability Act (HIPAA)
3. Price of insurance per exposure unit.
Common Disability Exclusions
24 Hour Coverage (CA)
Rate (as defined by CIC)
Proof of Loss provision
4. 1: Fixed - guaranteed fixed monthly income & fixed interest rate; 2: Variable - unguaranteed; monthly income varies based on stocks/bond returns.
Annuity Classifications (3 of 5): Source of income
Change of Occupation provision
Concealment
Key Employee Disability policy
5. Treating or mitigating loss exposures through 1: avoidance; 2: retention (deductibles); 3: sharing; 4: reduction; or 5: transfer.
Mortality vs. Morbidity tables
Risk management
Convertibility provision
Considerations in replacing Health insurance
6. 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)
Types of Insurers (by sector)
Viatical Settlement Provider (VSP)
Age Discrimination in Employment Act (ADEA)
7. Privately-provided or Medicare-provided (if no private carrier) prescription drug plans for qualified individuals but w/ premium - deductible & co-pay.
Enhanced Ordinary (aka Extraordinary) Whole Life policy
Medicare Part D
Annuity Classifications (3 of 5): Source of income
Earned vs. Unearned premium
8. Same as WL but w/ Level Term rider; upon death - pays monthly income for FULL term AFTER which pays full death benefit.
Dividends
Factors that determine premium
Family Maintenance policy
Presumptive disability
9. Time period preceding each disability during which benefits are not paid; longer elimination periods = cheaper premium.
Plans A-L of Medical Supplement or Medigap
Medicaid/Medi-Cal
Elimination (aka Waiting) period
Employer-Administered plan
10. Allows policy owner to w/draw set % of death benefit upon verification of terminal illness w/ expectancy 12-24 mths.; generally tax-free.
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
Employee Retirement Income Security Act (ERISA)
Settlement options for Life policy (2 of 2)
Guaranteed Insurability Life rider
11. War - 2 types; Suicide (1st 2 yrs.); Aviation (non-commercial); Hazardous hobbies; Criminal acts; Alcohol/Drug influenced.
Payment of Premium provision
Equity Indexed annuity
Common Life Exclusions
Spendthrift provision
12. Authorized (admitted) - can conduct business in state; Unauthorized (non-admitted) - cannot conduct business in state (w/ one exception).
Tax implications of Death Benefit & Cash Value
Tax implications of Disability policy
Types of Insurers (by authorization)
Accidental Death & Dismemberment (AD&D) Life policy
13. Provides usual & customary business expenses (rent - utilities - salaries - mortgage) if owner becomes disabled; premiums deductible - benefits taxable.
Business Overhead Expense (BOE) Disability policy
Types of Insurers (by domicile)
Premium modes
Equity Index Whole Life policy
14. Written policy terms supersede oral statements made prior to policy issue.
Risk management
Notice of Claim provision
Parole Pardon Rule
Factors that determine premium
15. Federal law to protect Federal employees' (& their beneficiaries') pension - group insurance - & welfare benefits.
Employee Retirement Income Security Act (ERISA)
Medicare Part A (aka Hospital Insurance or HI)
Annuity Classifications (1 of 5): How premium is paid
Universal (aka Flexible Premium Adjustable) Life policy (2 of 4)
16. Group plan initially self-funded by employer (like SIR); after which - group plan Insurer covers (up to policy limit); requires TPA.
Doctrine of Comity
Spendthrift provision
Incontestability clause/provision
Employer-Administered plan
17. War; elective cosmetic surgery; routine dental; work. comp.-covered claims; self-inflicted (intentional); gov't. facility treatment; LTC; private nursing.
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
Binding receipt (aka Temporary Insurance Agreement)
Exclusions for Major Medical plan
Types of Accident & Health (A&H) providers
18. 1: Immediate benefits rec'd w/in 30 days but premium must be paid by lump sum; 2: Deferred - usually until retirement.
Valid life insurance contracts must identify...
Needs approach (most common)
Blackout Period
Annuity Classifications (2 of 5): When benefits begin
19. Private sector (Commercial) - provides LA&H - P&C - & LTC; Public sector (Gov't) - provides flood - work. comp. - Medicare/Medicaid - Group Life (SGLI/FEGLI).
Types of Term Life policies
Universal (aka Flexible Premium Adjustable) Life policy (2 of 4)
Equity Index Whole Life policy
Types of Insurers (by sector)
20. Receipt whereby coverage incepts immediately upon submission of full consideration - unless declined & premium refunded.
Approval Type Conditional receipt
Dividends
Binding receipt (aka Temporary Insurance Agreement)
Types of hazards
21. Same as WL but w/ Decreasing Term rider; upon death - pays monthly income for REMAINING term AFTER which pays full death benefit.
24 Hour Coverage (CA)
Tax implications of medical plans
Time Limit on Certain Defenses provision
Family Income policy
22. Allows Term policy conversion to Permanent policy w/out medical exam; must be identical or lower death benefit; based on either attained OR original age.
Preferred Provider Organization (PPO)
Convertibility provision
Employee Retirement Income Security Act (ERISA)
Legal Action provision
23. Intentional deception; grounds for rescission.
Policy delivery
Fraud
IRS Penalties for Annuities
Time Limit on Certain Defenses provision
24. Same as WL but premium low for 1st 5 yrs. - THEN has annual premium increases for set # yrs. - THEN level premium.
Graded Premium Whole Life policy
Tax implications of an Annuity (1 of 2)
Fraud
Approval Type Conditional receipt
25. Refund of 50-80% of premium (minus claims paid) every 5-10 yrs. OR age 65; expensive!
Return of Premium rider
Employee Retirement Income Security Act (ERISA)
Point of Service plan
Penalties for violating AIDS/HIV privacy laws
26. Provides % of monthly income benefit if Insured becomes disabled due to illness or accident.
Family Maintenance policy
Annuity Classifications (2 of 5): When benefits begin
Graded Premium Whole Life policy
Disability Income policy
27. Tendency of poorer risks to seek insurance.
Return of Premium rider
Adverse selection
Recurrent disability clause/provision
Accidental Death (aka Multiple Indemnity) rider
28. Two death benefit options - Option A: death benefit ONLY; Option B: death benefit + cash value; death benefit NOT guaranteed.
Universal (aka Flexible Premium Adjustable) Life policy (4 of 4)
Peril vs. Hazard
Business Continuation (aka Buy-Sell) policy
Annuity Classifications (1 of 5): How premium is paid
29. Covers disabilities occurring both "on" AND "off" job; "on" job benefits paid in addition to work. comp. - if applicable (i.e. individual plan).
Workers' Compensation insurance
Point of Service plan
Comprehensive Major Medical plan
Occupational Disability policy
30. Same as WL but can be "paid-up" early by paying larger premium for shorter payment period (i.e. 10 Pay Life - 20 Pay Life).
Change of Occupation provision
Split Dollar Plan
Limited Pay Whole Life policy
Pure risk vs. Speculative risk
31. Term Life policy w/ decreasing death benefit; usually used to secure credit (loan) w/ lender as beneficiary & borrower as Insured.
Common Disaster (Simultaneous Death Act) clause/provision
Credit Life policy
Enhanced Ordinary (aka Extraordinary) Whole Life policy
Market Value Adjusted (aka Modified Guaranteed) annuity
32. Combination of Basic Medical & Major Medical in one policy; Basic pays 1st - then Major Medical w/ corridor deductible.
Suicide clause/provision
Types of Renewability provisions
Universal (aka Flexible Premium Adjustable) Life policy (2 of 4)
Comprehensive Major Medical plan
33. An attempt to contain costs by employing various strategies - including wellness programs - preventative testing - outpatient & alternative procedures.
Medical cost containment (aka Managed care)
Social Security (aka Old Age Survivors Disability Health Insurance or OASDHI)
Dental Plan
Exclusions for Major Medical plan
34. Period of time following any children's survivor benefit & before benefits are provided to employee's widow/widower.
Types of Accident & Health insurance
Mortality vs. Morbidity tables
Blackout Period
AIDS/HIV discrimination
35. Policy owner has right to determine mode of premium payment but Insurer can charge admin. fee if not annual.
Plans A-L of Medical Supplement or Medigap
Retrocession
Elements to contract
Payment of Premium provision
36. Funding mechanism whereby employer & employee share cost of premium. Upon death - benefit is shared between employer & beneficiary.
Split Dollar Plan
Automatic Premium Loan (APL) provision
Grace Period provision
7 Pay Test
37. Federal law which prohibits companies w/ 15+ employees from decreasing coverage benefits for women affected by pregnancy or childbirth.
Settlement options for Life policy (1 of 2)
Permanent vs. Temporary disability
Civil Rights/Pregnancy Discrimination Act
Palliative vs. Curative care
38. Covers disabilities occurring ONLY "off" job; benefits do not overlap work. comp. (i.e. Group plan).
Variable Universal Life policy
Annuity Classifications (1 of 5): How premium is paid
Non-Occupational Disability policy
Valid life insurance contracts must identify...
39. Permanent - not recoverable (spinal cord injury); Temporary - recoverable (temp. illness/injury - broken limb).
Binding receipt (aka Temporary Insurance Agreement)
Types of Renewability provisions
Risk management
Permanent vs. Temporary disability
40. Upon death - death benefit is paid + the aggregate of cash value accumulated to date; add-on to WL policy ONLY.
Renewability provision
Return of Cash Value rider
Beneficiary provisions
Business Continuation (aka Buy-Sell) Disability policy
41. Policy covering minor child; premium fixed but death benefit increases by 5 times @ age 18 or 21.
Levels of Long Term Care provided
Dependent coverage
Common Life Exclusions
Juvenile Life (aka Jumping Juvenile) policy
42. Pure risk involves chance of loss ONLY (accident or misfortune). Speculative risk involves chance of loss OR gain (gambling - stock investment).
Fraud
Universal (aka Flexible Premium Adjustable) Life policy (3 of 4)
Pure risk vs. Speculative risk
Types of Agency Authority
43. Insurer has right to rescind policy & return premium if material misrepresentation in application is found w/in 1st 2 yrs.
Incontestability clause/provision
Medicaid/Medi-Cal
Dependent coverage
Proof of Loss provision
44. Policy provisions must conform to state regulations where policy is sold.
Conformity with State Statute provision
Premium modes
Exclusions for Major Medical plan
Family Income policy
45. 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.
Automatic Premium Loan (APL) provision
Partial disability rider
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
Age Discrimination in Employment Act (ADEA)
46. Info already known; Info that should have been known; Waived info; Irrelevant info.
Premium modes
Doctrine of Comity
Split Dollar Plan
Concealment exceptions
47. Provides for continued operation of business if partner becomes disabled - by allowing other partner(s) to buy disabled partner's interest in business.
Tax implications of medical plans
Key Employee policy
Business Continuation (aka Buy-Sell) Disability policy
Spendthrift provision
48. Periodic return of premium to policy owners from Mutual (Par) Companies; not guaranteed & not taxable as income; may be used in 6 ways.
Civil Rights/Pregnancy Discrimination Act
Variable Universal Life policy
Endowment Life policy
Dividends
49. Benefits automatically increase annually based on inflationary index (i.e. Consumer Price Index) OR flat rate (5% max.).
Supplemental Major Medical plan
Cost of Living Adjustment (COLA) Disability rider
Needs approach (most common)
Types of Insurers (miscellaneous)
50. Compensates business for loss due to death or disability of key employee; premiums not deductible but benefits tax-free.
Key Employee policy
Insuring clause/provision (aka Insuring Agreement)
Dental Plan
Equity Index Whole Life policy