Indiana Life & Health
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Questions
Participating Insurance Policy - answer- may pay dividends to the policyowner
Material Misrepresentation - answer- misstatement to a question asked in the
application process; death benefit claim will likely be denied
Law of Large Numbers - answer- the larger a group becomes, the easier it is to predict
losses; used to predict certain types of losses and set appropriate premiums
Substandard Risk - answer- results in higher premium
Standard Risk - answer- results in standard premium
Preferred Risk - answer- results in lower premium
Expense Loading - answer- combined with premiums to spread the operating costs of a
business to all insureds
Net Premium - answer- premiums without expense loading
Concealment - answer- occurs when a person withholds a material fact that is crucial to
making a decision; in insurance, this involves withholding information that would be
crucial to underwriting decisions
Warranty - answer- a statement guaranteed to be true
Representation - answer- a statement true to the best of an applicant's knowledge
3 Basic Types of Term Life Insurance - answer- level, increasing, and decreasing
Level Term - answer- death benefit doesn't change throughout the life of the policy
, Annually Renewable Term (ART) - answer- premium increases annually according to
attained age; policy may be guaranteed to be renewable each without proof of
insurability
Re-entry Option - answer- the insured, upon the end of a term policy with guaranteed
renewable option, may qualify for a discounted premium rate with proof of insurability
Decreasing Term - answer- death benefit decreases each year over duration of the
policy term; typically used when the amount of needed protection is time sensitive, or
decreases over time
Increasing Term - answer- death benefit increases each year over duration of the policy
term (usually by specific amount or percentage of original amount); often used by
insurance companies to fund certain riders that provide a refund of premiums of a
gradual increase in total coverage, such as the cost of living or return of premium riders
Convertible Term - answer- provides the policy owner with the right to convert the policy
to a permanent insurance policy without evidence of insurability; premium will be based
on the insured's attained age at the time of conversion
Continuous Premium (Straight Life or Ordinary Life) - answer- basic whole life policy;
will typically have the lowest annual premium
Limited Payment - answer- premiums for coverage paid-up before age 100; higher
premium and cash value builds up faster; 20-pay life, life paid-up at 65 (LP-65);
Single Premium Whole Life (SPWL) - answer- provides level death benefit to the
insured's age 100 for a one-time, lump-sum payment; policy completely paid-up after
one premium and generates immediate cash
Modified Life - answer- lower premium in first few policy years (3 to 5 years) and higher
level premium for remainder of insured's life
Graded-premium Whole Life - answer- premiums start low, gradually increase each
year (for about 5 to 10 years), and remain level thereafter
Interest Sensitive Whole Life (Current Assumption Life) - answer- provides same
benefits as traditional whole life policies with added benefit of current interest rates
which may allow for either greater cash value accumulation or a shorter premium-
paying period
Equity-Indexed Whole Life - answer- cash value is dependent upon the performance of
the equity index (S&P 500) although there is a guaranteed minimum interest rate;
policy's face amount increases annually to keep pace with inflation
Insurance Exam | With 100%
Correct Answers graded A+
Guaranteed Success!!
Newest 2026 Complete
Questions
Participating Insurance Policy - answer- may pay dividends to the policyowner
Material Misrepresentation - answer- misstatement to a question asked in the
application process; death benefit claim will likely be denied
Law of Large Numbers - answer- the larger a group becomes, the easier it is to predict
losses; used to predict certain types of losses and set appropriate premiums
Substandard Risk - answer- results in higher premium
Standard Risk - answer- results in standard premium
Preferred Risk - answer- results in lower premium
Expense Loading - answer- combined with premiums to spread the operating costs of a
business to all insureds
Net Premium - answer- premiums without expense loading
Concealment - answer- occurs when a person withholds a material fact that is crucial to
making a decision; in insurance, this involves withholding information that would be
crucial to underwriting decisions
Warranty - answer- a statement guaranteed to be true
Representation - answer- a statement true to the best of an applicant's knowledge
3 Basic Types of Term Life Insurance - answer- level, increasing, and decreasing
Level Term - answer- death benefit doesn't change throughout the life of the policy
, Annually Renewable Term (ART) - answer- premium increases annually according to
attained age; policy may be guaranteed to be renewable each without proof of
insurability
Re-entry Option - answer- the insured, upon the end of a term policy with guaranteed
renewable option, may qualify for a discounted premium rate with proof of insurability
Decreasing Term - answer- death benefit decreases each year over duration of the
policy term; typically used when the amount of needed protection is time sensitive, or
decreases over time
Increasing Term - answer- death benefit increases each year over duration of the policy
term (usually by specific amount or percentage of original amount); often used by
insurance companies to fund certain riders that provide a refund of premiums of a
gradual increase in total coverage, such as the cost of living or return of premium riders
Convertible Term - answer- provides the policy owner with the right to convert the policy
to a permanent insurance policy without evidence of insurability; premium will be based
on the insured's attained age at the time of conversion
Continuous Premium (Straight Life or Ordinary Life) - answer- basic whole life policy;
will typically have the lowest annual premium
Limited Payment - answer- premiums for coverage paid-up before age 100; higher
premium and cash value builds up faster; 20-pay life, life paid-up at 65 (LP-65);
Single Premium Whole Life (SPWL) - answer- provides level death benefit to the
insured's age 100 for a one-time, lump-sum payment; policy completely paid-up after
one premium and generates immediate cash
Modified Life - answer- lower premium in first few policy years (3 to 5 years) and higher
level premium for remainder of insured's life
Graded-premium Whole Life - answer- premiums start low, gradually increase each
year (for about 5 to 10 years), and remain level thereafter
Interest Sensitive Whole Life (Current Assumption Life) - answer- provides same
benefits as traditional whole life policies with added benefit of current interest rates
which may allow for either greater cash value accumulation or a shorter premium-
paying period
Equity-Indexed Whole Life - answer- cash value is dependent upon the performance of
the equity index (S&P 500) although there is a guaranteed minimum interest rate;
policy's face amount increases annually to keep pace with inflation
