SUBJECTS
|
BROWSE
|
CAREER CENTER
|
POPULAR
|
JOIN
|
LOGIN
Business Skills
|
Soft Skills
|
Basic Literacy
|
Certifications
About
|
Help
|
Privacy
|
Terms
|
Email
Search
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. 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
1035 Exchange
Endowment Life policy
Universal (aka Flexible Premium Adjustable) Life policy (4 of 4)
2. IRS allows tax-free transfer of cash values between 2 LIKE policies (i.e. Life to Life - Annuity to Annuity - or Life to Annuity).
1035 Exchange
Annuity Classifications (2 of 5): When benefits begin
Risk management
COBRA Time Limitations
3. If Insured & primary beneficiary die due to same act (w/in 14 days) - primary assumed 1st to die & contingent beneficiary paid death benefit.
Renewability provision
Common Disaster (Simultaneous Death Act) clause/provision
Free Look provision
Accidental Death & Dismemberment (AD&D) Disability rider
4. Temp. coverage for set duration w/ death benefit ONLY (no cash value) - offers largest $ for lowest premium; renewable; convertible.
CHAMPUS (aka TriCare)
Split Dollar Plan
Health Maintenance Organization (HMO)
Term Life policy
5. Accumulation or "pay-in" - contributions & interest earned are tax-deferred; Annuity or "pay-out" - monthly annuity (taxable) paid.
Guaranteed Insurability Life rider
Types of Agency Authority
Phases of an annuity
Automatic Premium Loan (APL) provision
6. Revocable - changeable anytime w/ Change of Beneficiary Form; Irrevocable - not changeable w/out beneficiary permission.
Common Disability Exclusions
Revocable vs. Irrevocable beneficiary
Doctrine of Comity
Modified Endowment Contract (MEC)
7. No coverage for injuries while: 1: @ voluntary social event; 2: self-inflicted (intentional); 3: under alcohol/drug influence; 4: committing criminal act; 5: aggressor in workplace fight; 6: participating in athletic event (non-pro. athletes) 7: par
Exclusions to Work. Comp.
Endowment Life policy
Considerations in replacing Health insurance
Rescission
8. War/Military; Intentional self-inflicted; Aviation (non-commercial); Foreign country; Loss of professional license; Illegal activity; Mental disorders (after 1-2 yrs.).
Indemnify
Common Disability Exclusions
Applicant Representations vs. Warranties
Total disability (more restrictive definition)
9. Same as Comprehensive Major Medical but w/ integrated deductible; much more expensive.
Small Employer Medical Expense plan
Legal Action provision
Annuity Classifications (3 of 5): Source of income
Supplemental Major Medical plan
10. 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
Notice of Claim provision
Long Term Care (LTC) policy
Residual disability rider
11. The state in which the contract is accepted or delivered is the state that possesses regulatory jurisdiction over Group plan.
Exclusions for Major Medical plan
Types of Agency Authority
Key Employee Disability policy
Doctrine of Comity
12. Provides professional services - rehabilitation - training/re-training & related costs to assist Insured in returning to work.
Rehabilitation rider
Revocable vs. Irrevocable beneficiary
Presumptive disability
Needs approach (most common)
13. Provides 24 hr. health coverage both "on" & "off" job - but may cause coverage duplication & coordination challenges.
24 Hour Coverage (CA)
Annuity Classifications (2 of 5): When benefits begin
Annuity Classifications (4 of 5): Disposition "pay-out" of proceeds
Market Value Adjusted (aka Modified Guaranteed) annuity
14. Privately-provided or Medicare-provided (if no private carrier) prescription drug plans for qualified individuals but w/ premium - deductible & co-pay.
Modified Endowment Contract (MEC)
Medicare Part D
Payment of Premium provision
Life insurance policy
15. Death benefits & premium automatically increase annually based on inflationary index (i.e. Consumer Price Index).
Flexible Spending Account (FSA)
Cost of Living Adjustment (COLA) Life rider
Consolidated Omnibus Budget Reconciliation Act (COBRA)
Types of Renewability provisions
16. Death benefit is NOT taxable. Cash value grows tax-deferred but cost basis (base premium) is not taxable - only interest is.
Return of Premium rider
Tax implications of Death Benefit & Cash Value
Flexible Spending Account (FSA)
Insurer (as defined by CIC)
17. Taxable income (unlike individual plans); can be either short-term - 13-52 wks. max. or long-term - longer than 52 wks.
Levels of Long Term Care provided
Group Disability plan
Dread Disease policy
Law of Large Numbers
18. WL policy covering 2 or more Insureds but payable upon death of FIRST Insured - after which policy ends.
Medical Savings Account (MSA) & Health Savings Account (HSA)
Insurability Type Conditional receipt
Joint Life (aka "First to die") policy
Types of Insurers (miscellaneous)
19. Period of time following any children's survivor benefit & before benefits are provided to employee's widow/widower.
Blackout Period
Dental Plan
Types of Accident & Health (A&H) providers
Medicare Part C (aka Medicare Advantage)
20. Policy must be delivered w/ original (or copy of same) application attached.
Elements to contract
Entire Contract provision
Accidental Death & Dismemberment (AD&D) Life policy
Cost of Living Adjustment (COLA) Life rider
21. Agreement - Offer & acceptance; Consideration - application + premium; Legal capacity - licensed &/or competent; Legal purpose - public good.
Accidental Death & Dismemberment (AD&D) Disability rider
Key Employee Disability policy
Elements to contract
Insurer (as defined by CIC)
22. Coverage remains in effect for 31 days past premium due date; benefits paid during grace period would be deducted from sum.
Exclusions to Work. Comp.
24 Hour Coverage (CA)
Beneficiary provisions
Grace Period provision
23. PURELY employer-funded account to reimburse employees for qualified medical expenses not covered by group health plan.
Business Overhead Expense (BOE) Disability policy
Health Maintenance Organization (HMO)
Health Reimbursement Account (HRA)
Tax implications of Death Benefit & Cash Value
24. 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.
Types of Term Life policies
Variable Life policy (1 of 2)
Claim Form (aka Proof of Loss Form) provision
Peril vs. Hazard
25. Mathematical law stating the larger # of occurrences - the more predictable the losses; used to calculate premiums.
Law of Large Numbers
Civil Rights/Pregnancy Discrimination Act
Earned vs. Unearned premium
Market Value Adjusted (aka Modified Guaranteed) annuity
26. 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;
Accidental Death & Dismemberment (AD&D) Life policy
Social Security (aka Old Age Survivors Disability Health Insurance or OASDHI)
Health Reimbursement Account (HRA)
Health Insurance Portability and Accountability Act (HIPAA)
27. Same as WL but premium low for 1st 5 yrs. - THEN has annual premium increases for set # yrs. - THEN level premium.
Social Security (aka Old Age Survivors Disability Health Insurance or OASDHI)
Residual disability rider
Graded Premium Whole Life policy
Consolidated Omnibus Budget Reconciliation Act (COBRA)
28. Permanent - not recoverable (spinal cord injury); Temporary - recoverable (temp. illness/injury - broken limb).
Settlement options for Life policy (2 of 2)
Permanent vs. Temporary disability
Departments of an Insurer
Mortality vs. Morbidity tables
29. Provides increased death benefit if death occurs w/in 90 days & as result of accident; relatively INexpensive add-on.
Factors that determine premium
Types of hazards
Current Assumption (aka Interest-Sensitive) Whole Life policy
Accidental Death (aka Multiple Indemnity) rider
30. Same as WL but w/ Decreasing Term rider; upon death - pays monthly income for REMAINING term AFTER which pays full death benefit.
Insurance contract characteristics (2 of 2)
Family Income policy
Comprehensive Major Medical plan
Types of Licensed Producers
31. 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.
Preferred Provider Organization (PPO)
Dividend options
Rehabilitation rider
Tax implications of medical plans
32. Federal law to protect Federal employees' (& their beneficiaries') pension - group insurance - & welfare benefits.
Employee Retirement Income Security Act (ERISA)
Policy delivery
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
Accidental Death & Dismemberment (AD&D) Life policy
33. 1: Cash (tax-free); 2: Apply to future premiums; 3: Retained by Insurer @ interest; 4: Buy Paid-up WL policy add-ons; 5: Pay-up existing policy; 6: Buy 1-yr. Term policy.
Plans A-L of Medical Supplement or Medigap
Business Continuation (aka Buy-Sell) Disability policy
Rescission
Dividend options
34. Provides coverage for specific disease(s) - such as cancer or leukemia.
Variable Life policy (2 of 2)
Annuity Classifications (2 of 5): When benefits begin
Adverse selection
Dread Disease policy
35. 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.
Market Value Adjusted (aka Modified Guaranteed) annuity
Tax implications of an Estate
Tax implications of Disability policy
Convertibility provision
36. Receipt whereby coverage incepts conditionally upon submission of full consideration and that all underwriting reqs. are met.
Elements to contract
Insurability Type Conditional receipt
Needs approach (most common)
Tax implications of an Annuity (1 of 2)
37. Premiums determined by target cash values or death benefit; partial cash value w/drawals allowed; transparent policy w/ unbundled premium.
Earned vs. Unearned premium
Universal (aka Flexible Premium Adjustable) Life policy (2 of 4)
Common Life Exclusions
Settlement options for Life policy (2 of 2)
38. 1: Req. - unless self-employed; 2: 7-day wait for disability benefits; 3: Premium based on ex-mod; 4: Rates approved by CDI; 5: to sell - must satisfy education reqs.
Common Disability Exclusions
Premium modes
CA Work. Comp. Statutes
Cash value
39. Basic Medical; Major Medical; Comprehensive Major Medical
Types of Medical Plans
Annuity Classifications (3 of 5): Source of income
Supplemental Major Medical plan
Exclusions for Major Medical plan
40. WL policy covering 2 or more Insureds but ONLY payable upon death of LAST Insured - generally low premium but high death benefit.
Survivorship (aka "Last to die") policy
Small Employer Medical Expense plan
Life insurance policy
Business Continuation (aka Buy-Sell) policy
41. Allows for use of HMO/PPO or other private carrier to provide expanded benefits @ additional premium & if enrolled in BOTH Parts A & B.
Medicare Part C (aka Medicare Advantage)
Variable Life policy (1 of 2)
Types of hazards
Indeterminate Premium Whole Life policy
42. War - 2 types; Suicide (1st 2 yrs.); Aviation (non-commercial); Hazardous hobbies; Criminal acts; Alcohol/Drug influenced.
Workers' Compensation insurance
Limited Pay Whole Life policy
Common Life Exclusions
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
43. Covers disabilities occurring ONLY "off" job; benefits do not overlap work. comp. (i.e. Group plan).
Types of Medical Plans
Non-Occupational Disability policy
Penalties for violating AIDS/HIV privacy laws
Cross Purchase Plan
44. 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.
Tax implications of Death Benefit & Cash Value
Convertibility provision
Blue Cross/Blue Shield
Joint Life (aka "First to die") policy
45. Policy owner has right to determine mode of premium payment but Insurer can charge admin. fee if not annual.
Variable Life policy (2 of 2)
Comprehensive Major Medical plan
Blue Cross/Blue Shield
Payment of Premium provision
46. 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.
Business Continuation (aka Buy-Sell) policy
Dependent coverage
Accidental Death (aka Multiple Indemnity) rider
COBRA Time Limitations
47. 1: Surrender for cash value (taxable); 2: Buy equal-benefit paid-up Level Term policy; 3: Buy reduced-benefit paid-up WL policy.
Types of Agency Authority
Permanent vs. Temporary disability
Non-forfeiture options for WL policy
Viatical Settlement Provider (VSP)
48. Funding mechanism whereby employer & employee share cost of premium. Upon death - benefit is shared between employer & beneficiary.
Split Dollar Plan
Exclusions to Work. Comp.
Modified Endowment Contract (MEC)
Consolidated Omnibus Budget Reconciliation Act (COBRA)
49. Federal law which prohibits companies w/ 15+ employees from decreasing coverage benefits for women affected by pregnancy or childbirth.
Employee Retirement Income Security Act (ERISA)
Universal (aka Flexible Premium Adjustable) Life policy (1 of 4)
Civil Rights/Pregnancy Discrimination Act
Trial Application (aka Request for Offer)
50. 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.
Insurance contract characteristics (1 of 2)
Law of Large Numbers
Health Insurance Portability and Accountability Act (HIPAA)
Change of Occupation provision