SUBJECTS
|
BROWSE
|
CAREER CENTER
|
POPULAR
|
JOIN
|
LOGIN
Business Skills
|
Soft Skills
|
Basic Literacy
|
Certifications
About
|
Help
|
Privacy
|
Terms
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. Allows for Term policy renewal @ higher premium w/out medical exam; guarantees insurability; based on actual/attained age.
Presumptive disability
Types of Term Life policies
Renewability provision
Employer-Administered plan
2. Allows Insured to increase death benefit w/out medical exam (subject to age max.) w/ additional premium rate determined @ attained age.
Market Value Adjusted (aka Modified Guaranteed) annuity
Annuity
Group Disability plan
Guaranteed Insurability Life rider
3. Waives premium upon disability of Insured until return to work; disability must persist for 90 days or longer; 1st 90 day premiums refunded after 90 days.
Split Dollar Plan
Rescission
Waiver of Premium provision
Needs approach (most common)
4. Funding mechanism whereby employer & employee share cost of premium. Upon death - benefit is shared between employer & beneficiary.
Survivorship (aka "Last to die") policy
Split Dollar Plan
AIDS/HIV discrimination
Factors that determine premium
5. Tendency of poorer risks to seek insurance.
Tax implications of an Estate
Business Continuation (aka Buy-Sell) Disability policy
Family Income policy
Adverse selection
6. Authorized (admitted) - can conduct business in state; Unauthorized (non-admitted) - cannot conduct business in state (w/ one exception).
Rescission
Medi-Cal Share Cost plan
Disability Income policy
Types of Insurers (by authorization)
7. 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.
Claim Form (aka Proof of Loss Form) provision
Beneficiary provisions
Dividend options
Cash value
8. War - 2 types; Suicide (1st 2 yrs.); Aviation (non-commercial); Hazardous hobbies; Criminal acts; Alcohol/Drug influenced.
Credit Life policy
Graded Premium Whole Life policy
Tax implications of an Estate
Common Life Exclusions
9. Same as Comprehensive Major Medical but w/ integrated deductible; much more expensive.
Health Insurance Portability and Accountability Act (HIPAA)
Juvenile Life (aka Jumping Juvenile) policy
Key Employee policy
Supplemental Major Medical plan
10. 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.
Equity Index Whole Life policy
Tax implications of an Estate
Types of Insurers (miscellaneous)
Peril vs. Hazard
11. Intentional OR unintentional failure to disclose material underwriting facts that should have been disclosed; grounds for policy rescission.
Retrocession
Partial disability rider
Common Accident provision
Concealment
12. 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.
Survivorship (aka "Last to die") policy
Equity Indexed annuity
Primary Insurance Amount (PIA)
Social Security (aka Old Age Survivors Disability Health Insurance or OASDHI)
13. Revocable - changeable anytime w/ Change of Beneficiary Form; Irrevocable - not changeable w/out beneficiary permission.
Rate (as defined by CIC)
Types of Accident & Health insurance
Guaranteed Insurability (aka Additional Purchase or Future Increase) Disability rider
Revocable vs. Irrevocable beneficiary
14. After 2-3 yrs. - Whole Life policy equity builds tax-deferred @ fixed interest rate until it equals death benefit; borrowable but taxable.
Cash value
Time Limit on Certain Defenses provision
Accelerated Benefits (aka Terminal Illness or Living Benefits) rider
Annuity Classifications (1 of 5): How premium is paid
15. Agents - represent Insurer; Brokers - represent themselves & Insured; Solicitors - represent one agent to solicit leads.
Medicare Part A (aka Hospital Insurance or HI)
Types of Licensed Producers
Modified Endowment Contract (MEC)
Workers' Compensation insurance
16. Provides % of monthly income benefit if Insured becomes disabled due to illness or accident.
Return of Premium rider
Universal (aka Flexible Premium Adjustable) Life policy (2 of 4)
Disability Income policy
Types of Insurers (by domicile)
17. Written contract to transfer risk of premature death from one party to another; pays stated sum upon death; creates instant estate.
AIDS/HIV discrimination
Business Continuation (aka Buy-Sell) policy
Life insurance policy
Elimination (aka Waiting) period
18. Compensates business for loss due to disability of key employee; premiums not deductible but benefits tax-free.
Medicare
Key Employee Disability policy
Age Discrimination in Employment Act (ADEA)
Employer Liability
19. Prepaid med. benefits for "subscribers" @ approved facilities; many non-profit; Blue Cross - Hospital stays; Blue Shield - M.D. costs.
7 Pay Test
Blue Cross/Blue Shield
Accidental Death & Dismemberment (AD&D) Life policy
Return of Premium rider
20. 1: parties to contract; 2: insured party or life; 3: insurable interest - if 3rd party; 4: risks insured against; 5: policy period (term); 6: premium & mode.
Time Limit on Certain Defenses provision
Retrocession
Valid life insurance contracts must identify...
Law of Large Numbers
21. Provides benefit during Social Security "black-out" period - up to 1 yr.
Social Security Benefit (Supplement) rider
Juvenile Life (aka Jumping Juvenile) policy
Tax implications of medical plans
Tax implications of Disability policy
22. 1: Skilled nursing care; 2: Intermediate care; 3: Custodial care; 4: Home health care.
Employee Retirement Income Security Act (ERISA)
Levels of Long Term Care provided
Return of Premium rider
Premium modes
23. Partially state-funded benefits for low-income people whereby cost of care is shared between state & recipient - based on income.
Medi-Cal Share Cost plan
Insurance contract characteristics (2 of 2)
Modified Endowment Contract (MEC)
Incontestability clause/provision
24. Experience - rates impacted by actual prior claim experience of actual group; Community - identical rates used for entire community - regardless of experience.
Accidental Death & Dismemberment (AD&D) Disability rider
Experience vs. Community rating in Group Health plan
Binding receipt (aka Temporary Insurance Agreement)
Underwriting risk categories
25. Policy owner has right to determine mode of premium payment but Insurer can charge admin. fee if not annual.
Payment of Premium provision
Tax implications of an Estate
Needs approach (most common)
Types of Insurers (by sector)
26. 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)
Waiver of Premium provision
Rate (as defined by CIC)
Parole Pardon Rule
27. Generally 10 days after policy delivery to cancel policy w/ full refund - except 30 days for seniors or for replacement policies.
Accidental Death & Dismemberment (AD&D) Life policy
Free Look provision
Medi-Cal Share Cost plan
Business Continuation (aka Buy-Sell) policy
28. Policy provisions must conform to state regulations where policy is sold.
Change of Occupation provision
Notice of Claim provision
Concealment exceptions
Conformity with State Statute provision
29. No deductible coverage for: daily room/board; ancillary costs; surgeon &/or physician expense (for added premium).
AIDS/HIV discrimination
Plans A-L of Medical Supplement or Medigap
Basic Medical plan
Insurer (as defined by CIC)
30. Provides coverage for specific disease(s) - such as cancer or leukemia.
Dread Disease policy
Limited Pay Whole Life policy
Guaranteed Insurability Life rider
Transplant/Cosmetic Surgery rider
31. A lapsed policy may be reinstated if not longer than 3-5 yrs. - & proof of insurability re-established - & back premiums + interest paid.
Types of Term Life policies
Free Look provision
Trial Application (aka Request for Offer)
Reinstatement provision
32. Savings account for medical expenses; Tax-deductible contributions; tax-deferred growth; tax-free for qualified use; taxable for non-qualified use.
Comprehensive Major Medical plan
Needs approach (most common)
Payor (aka Waiver of Payor's Premium) rider
Medical Savings Account (MSA) & Health Savings Account (HSA)
33. Must be delivered in person or by certified - registered or 1st-class mail w/ signature - unless waived by Insurance Commissioner.
Earned vs. Unearned premium
Impairment (Exclusion) rider
Total disability (as commonly defined)
Policy delivery
34. Policy must be delivered w/ original (or copy of same) application attached.
Spendthrift provision
Entire Contract provision
Guaranteed Insurability Life rider
Renewability provision
35. Federal law which prohibits companies w/ 15+ employees from decreasing coverage benefits for women affected by pregnancy or childbirth.
Notice of Claim provision
Medicaid/Medi-Cal
Civil Rights/Pregnancy Discrimination Act
Conformity with State Statute provision
36. Death benefits & premium automatically increase annually based on inflationary index (i.e. Consumer Price Index).
Insurer (as defined by CIC)
Modified Premium Whole Life policy
Adjustable Whole Life policy
Cost of Living Adjustment (COLA) Life rider
37. Grows @ fixed interest rate for set term but cash value may adjust to prevailing rate (+ or -) if fully surrendered before term ends; % w/drawal ok.
Settlement options for Life policy (1 of 2)
Market Value Adjusted (aka Modified Guaranteed) annuity
Blue Cross/Blue Shield
Rescission
38. Earned premium is $ paid for coverage to date. Unearned premium is $ paid & returnable due to coverage not provided.
Earned vs. Unearned premium
Entire Contract provision
Fraud
Equity Indexed annuity
39. Insurance purchased by other Insurer(s) to spread or diversify risk; promotes industry stability.
Peril vs. Hazard
Insurer (as defined by CIC)
Reinsurance
Considerations in replacing Health insurance
40. Pre-existing illness/injury; Waiting period; Elimination period; Probationary period; Benefits - Exclusions - Limitations; Underwriting reqs.
Considerations in replacing Health insurance
Total disability (as commonly defined)
Common Accident provision
Medical Savings Account (MSA) & Health Savings Account (HSA)
41. If Insured & primary beneficiary die due to same act (w/in 14 days) - primary assumed 1st to die & contingent beneficiary paid death benefit.
Major Medical plan
Legal Action provision
Common Disaster (Simultaneous Death Act) clause/provision
Types of Renewability provisions
42. Pays death benefit until age 100 or death; builds equity (cash value); may be transferred or sold; generally level premium.
Insurance contract characteristics (2 of 2)
Annuity Classifications (1 of 5): How premium is paid
Whole (aka Permanent or Straight) Life policy
Medi-Cal Share Cost plan
43. Policyholders - Mutual (participating) co. - may pay dividends; Stockholders - Stock (non-participating) co. - no dividends.
COBRA Time Limitations
Types of Insurers (by ownership)
Tax implications of Dividends - Loans & Interest
Renewability provision
44. 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 Overhead Expense (BOE) Disability policy
Reinsurance
COBRA Time Limitations
Universal (aka Flexible Premium Adjustable) Life policy (2 of 4)
45. IRS allows tax-free transfer of cash values between 2 LIKE policies (i.e. Life to Life - Annuity to Annuity - or Life to Annuity).
Relation of Earnings to Insurance provision
Factors that determine premium
Settlement options for Life policy (2 of 2)
1035 Exchange
46. 1: Surrender for cash value (taxable); 2: Buy equal-benefit paid-up Level Term policy; 3: Buy reduced-benefit paid-up WL policy.
Return of Premium rider
Modified Premium Whole Life policy
Waiver of Premium (Waiver of Cost of Insurance) rider
Non-forfeiture options for WL policy
47. Potential circumstance that could cause a loss; measured in dollars.
Loss exposure
Medicare Part B (aka Supplemental Medical Insurance or SMI)
Trial Application (aka Request for Offer)
Settlement options for Life policy (2 of 2)
48. Death benefit determined by Insured's financial goals & needs (minus assets).
Tax implications of Death Benefit & Cash Value
Annuity Classifications (1 of 5): How premium is paid
Needs approach (most common)
Endowment Life policy
49. Req. by CA statute & may provide workers coverage for action-over claims.
Non-Occupational Disability policy
Dental Plan
Employer Liability
Policy delivery
50. Provides disability income during surgery recovery from life-threatening condition (& sometimes cosmetic surgery).
Transplant/Cosmetic Surgery rider
Concealment exceptions
Binding receipt (aka Temporary Insurance Agreement)
Tax implications of an Annuity (1 of 2)