TEXAS LIFE AND HEALTH
INSURANCE EXAM WITH
UPDATED QUESTIONS AND
ANSWERS 2026/2027
What type of reinsurance contract involves two companies automatically sharing their risk exposure? -
ANSWER-Treaty
The stated amount or percent of liquid assets that an insurer must have on hand that will satisfy future
obligations to its policyholders is called - ANSWER-reserves
When third-party ownership is involved, applicants who also happen to be the stated primary
beneficiary are required to have - ANSWER-insurable interest
Statements made on an insurance application that are believed to be true to the best of the applicant's
knowledge are called - ANSWER-representations
The part of a life insurance policy guaranteed to be true is called a(n) - ANSWER-warranty
Which of these is NOT a type of agent authority?
Express
Implied
Principal
Apparent - ANSWER-Principal
The Consideration clause of an insurance contract includes - ANSWER-the schedule and amount of
premium payments
, E and F are business partners. Each takes out a $500,000 life insurance policy on the other, naming
himself as primary beneficiary. E and F eventually terminate their business, and four months later E dies.
Although E was married with three children at the time of death, the primary beneficiary is still F.
However, an insurable interest no longer exists. Where will the proceeds from E's life insurance policy
be directed to? - ANSWER-In this situation, the proceeds from E's life insurance policy will go to F.
Which term defines the legally enforceable promise in an insurance contract by the insurer? - ANSWER-
Unilateral
Insurance contracts are known as ____ because certain future conditions or acts must occur before any
claims can be paid. - ANSWER-conditional
Which of these require an offer, acceptance, and consideration? - ANSWER-Contract
Which of these is NOT considered to be an element of an insurance contract?
the offer
acceptance
negotiating
consideration - ANSWER-negotiating
An agent is an individual that represents whom? - ANSWER-Insurer
Which policy requires an agent to register with the National Association of Securities Dealers (NASD)
before selling? - ANSWER-Variable Life
Which of the following actions require a policy owner to provide proof of insurability in an Adjustable
Life policy? - ANSWER-increase face amount
INSURANCE EXAM WITH
UPDATED QUESTIONS AND
ANSWERS 2026/2027
What type of reinsurance contract involves two companies automatically sharing their risk exposure? -
ANSWER-Treaty
The stated amount or percent of liquid assets that an insurer must have on hand that will satisfy future
obligations to its policyholders is called - ANSWER-reserves
When third-party ownership is involved, applicants who also happen to be the stated primary
beneficiary are required to have - ANSWER-insurable interest
Statements made on an insurance application that are believed to be true to the best of the applicant's
knowledge are called - ANSWER-representations
The part of a life insurance policy guaranteed to be true is called a(n) - ANSWER-warranty
Which of these is NOT a type of agent authority?
Express
Implied
Principal
Apparent - ANSWER-Principal
The Consideration clause of an insurance contract includes - ANSWER-the schedule and amount of
premium payments
, E and F are business partners. Each takes out a $500,000 life insurance policy on the other, naming
himself as primary beneficiary. E and F eventually terminate their business, and four months later E dies.
Although E was married with three children at the time of death, the primary beneficiary is still F.
However, an insurable interest no longer exists. Where will the proceeds from E's life insurance policy
be directed to? - ANSWER-In this situation, the proceeds from E's life insurance policy will go to F.
Which term defines the legally enforceable promise in an insurance contract by the insurer? - ANSWER-
Unilateral
Insurance contracts are known as ____ because certain future conditions or acts must occur before any
claims can be paid. - ANSWER-conditional
Which of these require an offer, acceptance, and consideration? - ANSWER-Contract
Which of these is NOT considered to be an element of an insurance contract?
the offer
acceptance
negotiating
consideration - ANSWER-negotiating
An agent is an individual that represents whom? - ANSWER-Insurer
Which policy requires an agent to register with the National Association of Securities Dealers (NASD)
before selling? - ANSWER-Variable Life
Which of the following actions require a policy owner to provide proof of insurability in an Adjustable
Life policy? - ANSWER-increase face amount
