NEVADA LIFE AND HEALTH INSURANCE EXAM
2026 STATE LICENSING TEST PAPER
QUESTIONS AND SOLUTIONS GRADED A+
◉ face amount. Answer: death benefit
◉ 3 basic types of term coverage. Answer: level, increasing,
decreasing
- based on how the face amount changes during the policy term
◉ What is the premium in term insurance. Answer: regardless of
type of term insurance purchased, premium is level throughout the
term of policy
◉ level term insurance. Answer: death benefit does not change
throughout the life of the policy
◉ annually renewable term. Answer: premium increases annually
according to the attained age, guaranteed to be renewable each year
◉ decreasing term. Answer: level premium and death benefit that
decreases each year over duration of the policy term
,◉ increasing term. Answer: level premium and death benefit that
increases each year over the duration of the policy term
◉ return of premium life insurance. Answer: an increasing term
policy that pays an additional death beneficiary equal to the amount
of the premiums paid
- return of premium is paid if the death occurs within a specified
period of time or if the insured outlives the policy term
◉ renewable provision. Answer: allows the policyowner the right to
renew coverage at the expiration date without evidence of
insurability
◉ convertible provision. Answer: provides the policyowner the right
to convert the policy to a permanent insurance policy without
evidence of insurability
◉ permanent life insurance. Answer: general term used to refer to
various forms of life insurance policies that build cash value and
remain in effect for the entire life of the insured (or until age 100) as
long as premium is paid
,◉ nonforteiture value. Answer: aka cash value, does not usually
accumulate until the third policy year and it grows tax deferred
◉ key characteristics of whole life insurance. Answer: - level
premium
- death benefit
- cash value
- living benefits
◉ 3 basic forms of whole life insurance. Answer: 1. straight
(ordinary) whole life
2. limited-pay whole life
3. single premium whole life
◉ straight life. Answer: basic whole life policy; policy owner pays
the premium from the lime the policy is issued until insured's death
or age 100
- has lowest annual premium
◉ limited-pay whole life. Answer: designed so that premiums for
coverage will be completely paid-up well before age 100
, - cash value builds up faster
◉ single premium whole life. Answer: designed to provide a level
death benefit to the insured's age 100 for a one-time, lump-sum
payment
- generate immediate cash value
◉ adjustable life. Answer: can assume the form of either term
insurance or permanent insurance; insured typically determines
how much coverage is needed and the affordable amount of
premium
◉ adjustable life cash value. Answer: only develops when the
premiums paid are more than the cost of the policy
◉ universal life (flexible premium adjustable life). Answer:
policyowner has the flexibility to increase/decrease amount of
premium paid into policy; policyowner may skip paying a premium
and policy will not lapse as long as there is sufficient cash value at
the time to cover monthly deductions for cost of insurance
◉ universal life premium types. Answer: 1. minimum premium:
amount needed to keep policy in force for year
2026 STATE LICENSING TEST PAPER
QUESTIONS AND SOLUTIONS GRADED A+
◉ face amount. Answer: death benefit
◉ 3 basic types of term coverage. Answer: level, increasing,
decreasing
- based on how the face amount changes during the policy term
◉ What is the premium in term insurance. Answer: regardless of
type of term insurance purchased, premium is level throughout the
term of policy
◉ level term insurance. Answer: death benefit does not change
throughout the life of the policy
◉ annually renewable term. Answer: premium increases annually
according to the attained age, guaranteed to be renewable each year
◉ decreasing term. Answer: level premium and death benefit that
decreases each year over duration of the policy term
,◉ increasing term. Answer: level premium and death benefit that
increases each year over the duration of the policy term
◉ return of premium life insurance. Answer: an increasing term
policy that pays an additional death beneficiary equal to the amount
of the premiums paid
- return of premium is paid if the death occurs within a specified
period of time or if the insured outlives the policy term
◉ renewable provision. Answer: allows the policyowner the right to
renew coverage at the expiration date without evidence of
insurability
◉ convertible provision. Answer: provides the policyowner the right
to convert the policy to a permanent insurance policy without
evidence of insurability
◉ permanent life insurance. Answer: general term used to refer to
various forms of life insurance policies that build cash value and
remain in effect for the entire life of the insured (or until age 100) as
long as premium is paid
,◉ nonforteiture value. Answer: aka cash value, does not usually
accumulate until the third policy year and it grows tax deferred
◉ key characteristics of whole life insurance. Answer: - level
premium
- death benefit
- cash value
- living benefits
◉ 3 basic forms of whole life insurance. Answer: 1. straight
(ordinary) whole life
2. limited-pay whole life
3. single premium whole life
◉ straight life. Answer: basic whole life policy; policy owner pays
the premium from the lime the policy is issued until insured's death
or age 100
- has lowest annual premium
◉ limited-pay whole life. Answer: designed so that premiums for
coverage will be completely paid-up well before age 100
, - cash value builds up faster
◉ single premium whole life. Answer: designed to provide a level
death benefit to the insured's age 100 for a one-time, lump-sum
payment
- generate immediate cash value
◉ adjustable life. Answer: can assume the form of either term
insurance or permanent insurance; insured typically determines
how much coverage is needed and the affordable amount of
premium
◉ adjustable life cash value. Answer: only develops when the
premiums paid are more than the cost of the policy
◉ universal life (flexible premium adjustable life). Answer:
policyowner has the flexibility to increase/decrease amount of
premium paid into policy; policyowner may skip paying a premium
and policy will not lapse as long as there is sufficient cash value at
the time to cover monthly deductions for cost of insurance
◉ universal life premium types. Answer: 1. minimum premium:
amount needed to keep policy in force for year
