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State Farm Questions and Correct
Answers/ Latest Update / Already Graded
Absolute Assignment
Ans: Policy assignment when assignee receives full control
over the policy and full rights to its benefits.
Accelerated benefits rider
Ans: Life insurance rider that allow for early payment of some
portion of policy's face amount, should the insured suffer from
terminal illness/injury.
adhesion
Ans: Contract must be accepted by the insured exactly as it is
written by the insurer. Terms of contract cannot be negotiated.
Contract is offered on a take it or leave it basis.
admitted insurer
Ans: An insurance company that has been approved to operate
within a given jurisdiction.
accidental death benefit rider
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Ans: Life insurance policy rider providing for payment of an
additional benefit when death occurs by accidental means.
adjustable life
Ans: Policy allows the policymaker to adjust the policy's face
amount, premium, and type of protection without having to
complete a new application or any additional underwriting.
agents (producer) report
Ans: Section of an insurance application where the agent,
details personal observations about the applicant.
annually renewable term (ART)
Ans: A form of renewable term insurance that provides
coverage for one year and allows policyowner to renew
coverage each year, without evidence of insurability.
apparent authority
Ans: The insured believes the agent has authority to act base d
on actions, words or deeds of the agent. Even though the agent
may not have been granted such authority by the insurer, they
will be held liable for the actions of the agent.
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automatic premium loan provision
Ans: Authorizes the insurer to automatically pay any premium
in default at the end of the grace period. The premium owed
plus interest charged is deducted from the policy's cash value.
beneficiary
Ans: Person to whom the proceeds of a life or accident policy
are payable when the insured dies.
annuitant
Ans: One to whom an annuity is payable, or a person upon the
continuance of whose life further payment depends.
attained age
Ans: With reference to an insured, the current insurance age.
aviation exclusion
Ans: The insurer will not pay a claim if the insured dies as a
result of flying an aircraft or acting as a member of a flight
All rights reserved © 2025/ 2026 |
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crew. In most cases, the insurer will offer the applicant the
opportunity to purchase a rider offsetting the exclusion.
buyers guide
Ans: A generic publication that explains life insurance in a way
that an average consumer can understand. It does not contain
specific product or policy information
Buy-sell agreement
Ans: Agreement that a deceased businessowner's interest will
be sold and purchased at a predetermined price or at a price
according to a predetermined formula.
Churning
Ans: Replacing one life contract with another within the same
company without demonstrating a benefit to the client.
common disaster provision
Ans: This policy provision provides an alternative beneficiary in
the event that the insured and the original beneficiary die as
the result of a common accident.
All rights reserved © 2025/ 2026 |
State Farm Questions and Correct
Answers/ Latest Update / Already Graded
Absolute Assignment
Ans: Policy assignment when assignee receives full control
over the policy and full rights to its benefits.
Accelerated benefits rider
Ans: Life insurance rider that allow for early payment of some
portion of policy's face amount, should the insured suffer from
terminal illness/injury.
adhesion
Ans: Contract must be accepted by the insured exactly as it is
written by the insurer. Terms of contract cannot be negotiated.
Contract is offered on a take it or leave it basis.
admitted insurer
Ans: An insurance company that has been approved to operate
within a given jurisdiction.
accidental death benefit rider
All rights reserved © 2025/ 2026 |
, Page |2
Ans: Life insurance policy rider providing for payment of an
additional benefit when death occurs by accidental means.
adjustable life
Ans: Policy allows the policymaker to adjust the policy's face
amount, premium, and type of protection without having to
complete a new application or any additional underwriting.
agents (producer) report
Ans: Section of an insurance application where the agent,
details personal observations about the applicant.
annually renewable term (ART)
Ans: A form of renewable term insurance that provides
coverage for one year and allows policyowner to renew
coverage each year, without evidence of insurability.
apparent authority
Ans: The insured believes the agent has authority to act base d
on actions, words or deeds of the agent. Even though the agent
may not have been granted such authority by the insurer, they
will be held liable for the actions of the agent.
All rights reserved © 2025/ 2026 |
, Page |3
automatic premium loan provision
Ans: Authorizes the insurer to automatically pay any premium
in default at the end of the grace period. The premium owed
plus interest charged is deducted from the policy's cash value.
beneficiary
Ans: Person to whom the proceeds of a life or accident policy
are payable when the insured dies.
annuitant
Ans: One to whom an annuity is payable, or a person upon the
continuance of whose life further payment depends.
attained age
Ans: With reference to an insured, the current insurance age.
aviation exclusion
Ans: The insurer will not pay a claim if the insured dies as a
result of flying an aircraft or acting as a member of a flight
All rights reserved © 2025/ 2026 |
, Page |4
crew. In most cases, the insurer will offer the applicant the
opportunity to purchase a rider offsetting the exclusion.
buyers guide
Ans: A generic publication that explains life insurance in a way
that an average consumer can understand. It does not contain
specific product or policy information
Buy-sell agreement
Ans: Agreement that a deceased businessowner's interest will
be sold and purchased at a predetermined price or at a price
according to a predetermined formula.
Churning
Ans: Replacing one life contract with another within the same
company without demonstrating a benefit to the client.
common disaster provision
Ans: This policy provision provides an alternative beneficiary in
the event that the insured and the original beneficiary die as
the result of a common accident.
All rights reserved © 2025/ 2026 |
