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. Privately-sold policies to provide benefits not covered by Medicare; divided into 12 plans listed alphabetically A - L; 30-day free look; guaranteed renewable.






2. Same as Term Life but provides living benefit (endowment) to policy owner if Insured survives entire term.






3. Same as Universal Life but cash value put in investment vehicles chosen by policy owner (stocks - bonds - munis.); cash value NOT guaranteed.






4. Policy must be delivered w/ original (or copy of same) application attached.






5. Conditional - coverage is conditional; Personal - parties are people; Good faith - honesty/integrity; Fiduciary - req's financial trust.






6. Death benefit determined by Insured's financial goals & needs (minus assets).






7. Provides coverage for specific disease(s) - such as cancer or leukemia.






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






9. 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






10. Waives premium upon disability of Insured until return to work; disability must persist for 6 mths. or longer. Cash value & dividends not affected.






11. 1: Single (lump sum) premium; 2: Periodic premiums - can be level (fixed $) OR flexible from mth. to mth. (w/ req. min.)






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






13. Policy provisions must conform to state regulations where policy is sold.






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






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






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






17. Intentional deception; grounds for rescission.






18. Beneficiary has right to leave death benefits / Insurer to protect $ from creditors; interest (taxable) paid on retained funds.






19. Agreement - Offer & acceptance; Consideration - application + premium; Legal capacity - licensed &/or competent; Legal purpose - public good.






20. An irrevocable IRS classification of a policy (determined by the 7 Pay Test) whereby tax advantages are lost for all distributions ONLY.






21. Info already known; Info that should have been known; Waived info; Irrelevant info.






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






23. Prevents overinsuring in order to profit from disability by coordinating benefits between Insurers.






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






25. Provides benefit during Social Security "black-out" period - up to 1 yr.






26. 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.






27. 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.






28. If total premiums paid w/in 1st 7 yrs. exceed net level premium that should have been paid - policy is an MEC.






29. Pays death benefit until age 100 or death; builds equity (cash value); may be transferred or sold; generally level premium.






30. Process whereby a reinsurer reinsures w/ another reinsurer.






31. Partially state-funded benefits for low-income people whereby cost of care is shared between state & recipient - based on income.






32. Accumulation or "pay-in" - contributions & interest earned are tax-deferred; Annuity or "pay-out" - monthly annuity (taxable) paid.






33. Underwriting - determines insurability; Marketing/Sales - determines products; Actuarial - determines rates; Claims - investigates/pays claims.






34. No-charge annuity w/drawals allowed up to 10% of total - THEN penalized on sliding scale based on # policy yrs.; conditionally waived.






35. 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.






36. Mandatory 100% employer-funded coverage for injuries/illnesses occurring "on" job; full-time employees only; exclusive remedy. Provides: 1: unlimited medical benefit; 2: survivor income replacement & funeral ($5 -000 max.); 3: disability benefit @ 66

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37. 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;






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






39. Unintentional - up to $1 -000 + legal $; Intentional - $1 -000-5 -000 + legal $; If harmful - misdemeanor + up to 1 yr. prison + up to $10 -000.






40. Facultative - case by case agreements; Automatic/Treaty - automatic acceptance of risk percentage per previous agreement.






41. Multiple small employers w/ common affiliation (trade assoc. OR Chamber of Commerce) band together to purchase group plan.






42. Treating or mitigating loss exposures through 1: avoidance; 2: retention (deductibles); 3: sharing; 4: reduction; or 5: transfer.






43. 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.






44. To "make whole again" w/out benefit or detriment; neither monetary profit nor loss.






45. Monthly; Quarterly; Semi-annually; Annually (cheapest due to less admin cost).






46. If Insured changes to: more hazardous job - benefits reduced; less hazardous job - premiums reduce.






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






48. Policyholders - Mutual (participating) co. - may pay dividends; Stockholders - Stock (non-participating) co. - no dividends.






49. Upon notice - Insurer must provide Claim Form (Proof of Loss Form) to Insured w/in 15 days.






50. Mathematical calculation based on overall FICA contributions used to determine retirement/disability/survivorship benefit.