Texas State Exam Simulator - Life and Health Insurance
Comprehensive Resource To Help You Ace Exams Includes
Frequently Tested Questions With ELABORATED 100%
Correct COMPLETE SOLUTIONS
Guaranteed Pass First Attempt!! Current Update!!
1. K is an agent who takes an application for individual life insurance and accepts a
check from the client. He submits the application and check to the insurance
company, however the check was never signed by the applicant. If the application is
approved, when will coverage be effective?
a) The date the sales appointment was made
b) The date the application was submitted to the insurance company
c) The date of application
d) The date the agent delivered the policy, collected the initial premium, and
obtained a good health statement from the insured - CORRECT ANSWER The
date the agent delivered the policy, collected the initial premium, and obtained a
good health statement from the insured
2. An assignment of benefits of a Health Policy
a) transfers payments to someone other than the policyowner
b) is prohibited by state law
c) is allowed only on policies dates after 1992
d) transfers rights from the company to the policyholder - CORRECT ANSWER
transfers payments to someone other than the policyowner
3. What type of policy would only provide coverage for specific types of illnesses
(cancer, stroke, etc)?
a) MEWA
b) Blanket insurance
c) Dread disease insurance
d) Disability insurance - CORRECT ANSWER Dread disease insurance
4. K becomes ill after traveling overseas and is unable to work for 3 months. What kind
of policy would cover her loss of income?
a) Indemnity
b) Major Medical
c) Travel
d) Disability Income - CORRECT ANSWER Disability Income
,5. M purchased an Accidental Death and Dismemberment (AD&D) policy and named
his son as beneficiary. M has the right to change the beneficiary designation at
anytime. What type of beneficiary is his son?
a) Tertiary
b) Irrevocable
c) Revocable
d) Contingent - CORRECT ANSWER Revocable
6. The Accidental Death and Dismemberment (AD&D) provision in a life insurance
policy would pay additional benefits if the insured
a) dies of natural causes
b) becomes critically ill
c) becomes chronically ill
d) is blinded in an accident - CORRECT ANSWER is blinded in an accident
7. Which of the following policy features allows an insured to defer current health
charges to the following year's deductible instead of the current year's deducitble?
a) Deferral provision
b) Carryover provision
c) Stop Loss provision
d) Corridor provision - CORRECT ANSWER Carryover provision
8. T has an annuity that guarantees an income payment for the rest of his life. The
contract also guarantees that if T dies before receiving payments for 20 years, the
remaining payments will be paid to his son for the balance of the 20 years. What
type of annuity is this?
a) Fixed Certain
b) Joint and Full Survivor
c) Life Annuity with Period Certain
d) Installment Refund - CORRECT ANSWER Life Annuity with Period Certain
9. On August 6, D submitted an application for a $50,000 Life Insurance policy and
did not pay the initial premium. On August 18, D went to his doctor complaining of
chest pains and some tests were given by the doctor. The life policy was delivered
by the producer on August 20 and D explains what had recently taken place with the
doctor. What action should the producer then take?
a) Collect initial premium
b) Collect initial premium along with a signed health statement
c) Explain to the applicant the policy is no longer in effect due to change in health
condition
, d) Collect initial premium and leave a binding receipt - CORRECT ANSWER Collect
initial premium along with a signed health statement
10. Which of the following costs would a Basic Hospital/Surgical policy likely cover?
a) Surgically removing a facial birthmark
b) Care given at a nursing home
c) Treating a wound from a soldier injured at war
d) Lost income caused by a hospital stay - CORRECT ANSWER Surgically
removing a facial birthmark
11. Which of these statements concerning an Individual Straight Life annuity is
accurate?
a) Life expectancy of the annuitant is not a factor
b) The payments are received tax-free
c) Only available to employees of nonprofit charitable, educational, and religious
organizations
d) Payments are made to an annuitant for life - CORRECT ANSWER Payments are
made to an annuitant for life
12. J let her life insurance policy lapse 8 months ago due to nonpayment. She can
reestablish coverage under which of the following provisions?
a) Payor clause
b) Automatic Premium Loan provision
c) Reinstatement provision
d) Waiver of Premium - CORRECT ANSWER Reinstatement provision
13. P is an employee who quits her job and wants to convert her group health coverage
to an individual policy. After the expiration of COBRA laws, which of the following
statements is TRUE?
a) She DOES need to provide evidence of insurability
b) She does NOT need to provide evidence of insurability
c) She will have up to 6 months to convert to an individual policy
d) She will be paying exactly the same premium for the individual plan as she did
the group plan - CORRECT ANSWER She does NOT need to provide evidence
of insurability
14. A whole life insurance policyowner does not wish to continue making premium
payments. Which of the following enables the policyowner to sell the policy for more
than its cash value?
a) Cash surrender
b) Life settlement contract
, c) Buy-sell arrangement
d) 1031 Exchange - CORRECT ANSWER Life settlement contract
15. Who can purchase a plan through the Marketplace?
a) Anyone
b) Any legal resident except those incarcerated
c) Only those who do not have access to employer-sponsored coverage
d) Only those who might be eligible for tax credits - CORRECT ANSWER Any legal
resident except those incarcerated
16. What is Old Age and Survivors Health Insurance (OASDHI) also known as?
a) Medicare
b) Social Security
c) Medicaid
d) FICA - CORRECT ANSWER Social Security
17. Which of these require an offer, acceptance, and consideration?
a) Warranty
b) Estoppel
c) Contract
d) Representation - CORRECT ANSWER Contract
18. How does a typical Variable Life Policy investment account grow?
a) Tied to price of gold
b) Through mutual funds, stocks, bonds
c) Based on returns from insurer's general account
d) Tied to Treasury Bills - CORRECT ANSWER Through mutual funds, stocks,
bonds
19. An applicant's medical information received from the Medical Information Bureau
(MIB) may be furnished to the
a) agent
b) applicant's spouse
c) National Association of Insurance Commissioners (NAIC)
d) applicant's physician - CORRECT ANSWER applicant's physician
20. After the initial enrollment period, an HMO must hold an open enrollment period of
how many days at LEAST once in every 12-month period?
a) 15
b) 31
Comprehensive Resource To Help You Ace Exams Includes
Frequently Tested Questions With ELABORATED 100%
Correct COMPLETE SOLUTIONS
Guaranteed Pass First Attempt!! Current Update!!
1. K is an agent who takes an application for individual life insurance and accepts a
check from the client. He submits the application and check to the insurance
company, however the check was never signed by the applicant. If the application is
approved, when will coverage be effective?
a) The date the sales appointment was made
b) The date the application was submitted to the insurance company
c) The date of application
d) The date the agent delivered the policy, collected the initial premium, and
obtained a good health statement from the insured - CORRECT ANSWER The
date the agent delivered the policy, collected the initial premium, and obtained a
good health statement from the insured
2. An assignment of benefits of a Health Policy
a) transfers payments to someone other than the policyowner
b) is prohibited by state law
c) is allowed only on policies dates after 1992
d) transfers rights from the company to the policyholder - CORRECT ANSWER
transfers payments to someone other than the policyowner
3. What type of policy would only provide coverage for specific types of illnesses
(cancer, stroke, etc)?
a) MEWA
b) Blanket insurance
c) Dread disease insurance
d) Disability insurance - CORRECT ANSWER Dread disease insurance
4. K becomes ill after traveling overseas and is unable to work for 3 months. What kind
of policy would cover her loss of income?
a) Indemnity
b) Major Medical
c) Travel
d) Disability Income - CORRECT ANSWER Disability Income
,5. M purchased an Accidental Death and Dismemberment (AD&D) policy and named
his son as beneficiary. M has the right to change the beneficiary designation at
anytime. What type of beneficiary is his son?
a) Tertiary
b) Irrevocable
c) Revocable
d) Contingent - CORRECT ANSWER Revocable
6. The Accidental Death and Dismemberment (AD&D) provision in a life insurance
policy would pay additional benefits if the insured
a) dies of natural causes
b) becomes critically ill
c) becomes chronically ill
d) is blinded in an accident - CORRECT ANSWER is blinded in an accident
7. Which of the following policy features allows an insured to defer current health
charges to the following year's deductible instead of the current year's deducitble?
a) Deferral provision
b) Carryover provision
c) Stop Loss provision
d) Corridor provision - CORRECT ANSWER Carryover provision
8. T has an annuity that guarantees an income payment for the rest of his life. The
contract also guarantees that if T dies before receiving payments for 20 years, the
remaining payments will be paid to his son for the balance of the 20 years. What
type of annuity is this?
a) Fixed Certain
b) Joint and Full Survivor
c) Life Annuity with Period Certain
d) Installment Refund - CORRECT ANSWER Life Annuity with Period Certain
9. On August 6, D submitted an application for a $50,000 Life Insurance policy and
did not pay the initial premium. On August 18, D went to his doctor complaining of
chest pains and some tests were given by the doctor. The life policy was delivered
by the producer on August 20 and D explains what had recently taken place with the
doctor. What action should the producer then take?
a) Collect initial premium
b) Collect initial premium along with a signed health statement
c) Explain to the applicant the policy is no longer in effect due to change in health
condition
, d) Collect initial premium and leave a binding receipt - CORRECT ANSWER Collect
initial premium along with a signed health statement
10. Which of the following costs would a Basic Hospital/Surgical policy likely cover?
a) Surgically removing a facial birthmark
b) Care given at a nursing home
c) Treating a wound from a soldier injured at war
d) Lost income caused by a hospital stay - CORRECT ANSWER Surgically
removing a facial birthmark
11. Which of these statements concerning an Individual Straight Life annuity is
accurate?
a) Life expectancy of the annuitant is not a factor
b) The payments are received tax-free
c) Only available to employees of nonprofit charitable, educational, and religious
organizations
d) Payments are made to an annuitant for life - CORRECT ANSWER Payments are
made to an annuitant for life
12. J let her life insurance policy lapse 8 months ago due to nonpayment. She can
reestablish coverage under which of the following provisions?
a) Payor clause
b) Automatic Premium Loan provision
c) Reinstatement provision
d) Waiver of Premium - CORRECT ANSWER Reinstatement provision
13. P is an employee who quits her job and wants to convert her group health coverage
to an individual policy. After the expiration of COBRA laws, which of the following
statements is TRUE?
a) She DOES need to provide evidence of insurability
b) She does NOT need to provide evidence of insurability
c) She will have up to 6 months to convert to an individual policy
d) She will be paying exactly the same premium for the individual plan as she did
the group plan - CORRECT ANSWER She does NOT need to provide evidence
of insurability
14. A whole life insurance policyowner does not wish to continue making premium
payments. Which of the following enables the policyowner to sell the policy for more
than its cash value?
a) Cash surrender
b) Life settlement contract
, c) Buy-sell arrangement
d) 1031 Exchange - CORRECT ANSWER Life settlement contract
15. Who can purchase a plan through the Marketplace?
a) Anyone
b) Any legal resident except those incarcerated
c) Only those who do not have access to employer-sponsored coverage
d) Only those who might be eligible for tax credits - CORRECT ANSWER Any legal
resident except those incarcerated
16. What is Old Age and Survivors Health Insurance (OASDHI) also known as?
a) Medicare
b) Social Security
c) Medicaid
d) FICA - CORRECT ANSWER Social Security
17. Which of these require an offer, acceptance, and consideration?
a) Warranty
b) Estoppel
c) Contract
d) Representation - CORRECT ANSWER Contract
18. How does a typical Variable Life Policy investment account grow?
a) Tied to price of gold
b) Through mutual funds, stocks, bonds
c) Based on returns from insurer's general account
d) Tied to Treasury Bills - CORRECT ANSWER Through mutual funds, stocks,
bonds
19. An applicant's medical information received from the Medical Information Bureau
(MIB) may be furnished to the
a) agent
b) applicant's spouse
c) National Association of Insurance Commissioners (NAIC)
d) applicant's physician - CORRECT ANSWER applicant's physician
20. After the initial enrollment period, an HMO must hold an open enrollment period of
how many days at LEAST once in every 12-month period?
a) 15
b) 31
