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. 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;






2. 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.






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






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






5. Agents - represent Insurer; Brokers - represent themselves & Insured; Solicitors - represent one agent to solicit leads.






6. Policy owner has 90 days from date of loss to submit proof of loss to Insurer; valid claim must be paid immediately upon receipt.






7. Covers disabilities occurring both "on" AND "off" job; "on" job benefits paid in addition to work. comp. - if applicable (i.e. individual plan).






8. Application submitted w/out premium; no coverage until submission of full consideration & completed Statement of Continued Good Health.






9. Responsible adult trustee designated to manage death benefits for minor child beneficiary until adulthood.






10. Period of time following any children's survivor benefit & before benefits are provided to employee's widow/widower.






11. Process which prevents claim denial as a result of false statement or promise (made by Insurer) - which was relied upon by Insured.






12. Actual/Expressed - written powers; Implied - unwritten but customary practices; Apparent - perceived powers.






13. Policy owner has right to determine mode of premium payment but Insurer can charge admin. fee if not annual.






14. Palliative - treatment to manage pain; Curative - treatment to cure illness/condition.






15. Must be delivered in person or by certified - registered or 1st-class mail w/ signature - unless waived by Insurance Commissioner.






16. Permanent - not recoverable (spinal cord injury); Temporary - recoverable (temp. illness/injury - broken limb).






17. Non-qualified Annuity - Non-deductible contributions & tax-deferred growth. At pay-out - tax-free principal but taxable growth.






18. War; elective cosmetic surgery; routine dental; work. comp.-covered claims; self-inflicted (intentional); gov't. facility treatment; LTC; private nursing.






19. Dividends are NOT taxable but interest is. Loan interest is NOT tax-deductible. Interest paid by Insurer on retained funds is taxable.






20. Revocable - changeable anytime w/ Change of Beneficiary Form; Irrevocable - not changeable w/out beneficiary permission.






21. Compensates business for loss due to disability of key employee; premiums not deductible but benefits tax-free.






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






23. Policy owner must notify Insurer of loss either in writing - in person or by phone w/in 20 days.






24. 'The inability to perform ANY gainful occupation'.






25. Reappearance of disability w/in 6 mth. period after "recovery" from same disability is considered recurrence - not new disability.






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






27. Both Contributory & Non-contributory Group policies are deductible to employer (not employee) but benefits are taxable. Individual policy premium is NOT deductible but benefit is received tax-free.






28. Insurer has right to rescind policy & return premium if material misrepresentation in application is found w/in 1st 2 yrs.






29. Provides for continued operation of business if partner dies - by allowing surviving partner(s) to buy deceased partner's interest in business.






30. Earned premium is $ paid for coverage to date. Unearned premium is $ paid & returnable due to coverage not provided.






31. Temp. coverage for set duration w/ death benefit ONLY (no cash value) - offers largest $ for lowest premium; renewable; convertible.






32. No-cost provision that authorizes Insurer to borrow from cash value to pay unpaid premiums after grace period; must ask for @ app. time.






33. Allows for Term policy renewal @ higher premium w/out medical exam; guarantees insurability; based on actual/attained age.






34. Federal law which prohibits companies w/ 15+ employees from decreasing coverage benefits for women affected by pregnancy or childbirth.






35. 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.






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






37. Upon death - death benefit is paid + the aggregate of premiums paid to date; add-on to Term policy ONLY.






38. Insurer has right to adjust (+ or -) death benefit if age or sex is misstated but normally doesn't void policy.






39. War/Military; Intentional self-inflicted; Aviation (non-commercial); Foreign country; Loss of professional license; Illegal activity; Mental disorders (after 1-2 yrs.).






40. War - 2 types; Suicide (1st 2 yrs.); Aviation (non-commercial); Hazardous hobbies; Criminal acts; Alcohol/Drug influenced.






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






42. Premiums determined by target cash values or death benefit; partial cash value w/drawals allowed; transparent policy w/ unbundled premium.






43. Taxable income (unlike individual plans); can be either short-term - 13-52 wks. max. or long-term - longer than 52 wks.






44. Periodic return of premium to policy owners from Mutual (Par) Companies; not guaranteed & not taxable as income; may be used in 6 ways.






45. 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.






46. 1: Single (lump sum) premium; 2: Periodic premiums - can be level (fixed $) OR flexible from mth. to mth. (w/ req. min.)






47. Fraternal - non-profit - members only; Reciprocal - unincorp'd org. - members insure each other; Lloyd's Assoc. - groups sharing risks; Surplus lines - special market risks.






48. Experience - rates impacted by actual prior claim experience of actual group; Community - identical rates used for entire community - regardless of experience.






49. Preferred or Preferred Smoker; Standard or Standard Smoker; Substandard; Denied.






50. 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.