XCEL Solutions Life and Health License
Exam (CA) Questions & Answers
A saving vehicle designed to first accumulate funds and then systematically liquidates
the funds - ANSWERSDeferred annuity
An annuity which is backed by a life insurer's separate account - ANSWERSVariable
Annuity
Cindy buys a 10-year certain annuity with an installment refund. After receiving monthly
payments for 5 years, Cindy dies. How many remaining payments will the insurer make
to her beneficiary? - ANSWERS60 payments
An annuitant would like to determine the current value of her annuity. To do this, she
multiplies the number of "accumulation units" she owns times the unit value of the
"separate account". What kind of annuity BEST matches this description? -
ANSWERSVariable Annuity
An annuitant would like to determine the amount of an annuity distribution that is
exempt from taxation. What is used to calculate this? - ANSWERSExclusion Ratio
What is a common reason people purchase an annuity? - ANSWERSTo protect against
the risk of outliving their financial resources
Which of the following is NOT a feature of equity annuities? - ANSWERSOffers a
maximum interest rate that increases annually
When a mutual insurer becomes a stock company, the process is called -
ANSWERSDemutualization
An insurer owned by its policyholder is called a - ANSWERSMutual insurer
Which of the following statements regarding a life insurance policy dividend is TRUE? -
ANSWERSIt is the distribution of excess of funds accumulated by the insurer on
participating policies
Which of the following is a type of insurance where an insurer transfers loss exposure
from policies written for its insureds? - ANSWERSReinsurance
AAA Insurance Company has transferred a portion of its loss exposure to BBB
Insurance Company. In this reinsurance transaction, what is AAA Insurance Company
called? - ANSWERSPrimary Insurer
, John owns an insurance policy that gives him the right to share in the insurer's surplus.
What kind of policy is this? - ANSWERSParticipating
Kim is insured under a disability income insurance policy with an "own-occupation"
clause. She was recently injured in an automobile accident and can no longer perform
the task of her job. Kim is no considered to be - ANSWERStotally disabled
What are residual disability income insurance payments based on? - ANSWERSThe
amount of the insured's income is reduced by the disability
Dyan is considered partially disabled by her insurance company. Which of the following
BEST describes her situation? - ANSWERSShe is working part-time and receiving lost
income under her long-term disability benefit
Under a disability income insurance policy, which criteria must be met for "bodily injury"
tp be classified as accidental? - ANSWERSThe cause may be intentional, but the result
must be accidental
The elimination period in a disability income policy serves the same purpose -
ANSWERSa deductible
Which of the following is NOT a provision in a disability income policy -
ANSWERSDeductible and coinsurance provision
Allen has a disability income policy with a $2,500 monthly benefit and a 30-day
elimination period. He is unable to work 90 days following an automobile accident. What
will the policy pay? - ANSWERS$5,000 (90 days - 30 days = 60 days or 2 months) 2
months x $2,500
The problem of overinsurance is addressed in which health insurance provision -
ANSWERSCoordination of benefits
When a claimant has coverage under more than one health plan, which group medical
plan provision applies? - ANSWERSCoordination of benefits
The Consolidated Omnibus Budget Reconciliation Act (COBRA) applies to employers
who employ at least - ANSWERS20 employees
Minimum participation standards exist for group health insurance plans in order to -
ANSWERSprevent adverse selection
What percentage of eligible employees must participate in a noncontributory group
health plan before it can be put in effect? - ANSWERS100%
An eligible individual who would like to obtain group health insurance without providing
evidence of insurability must - ANSWERSenroll within a specified eligibility period
Exam (CA) Questions & Answers
A saving vehicle designed to first accumulate funds and then systematically liquidates
the funds - ANSWERSDeferred annuity
An annuity which is backed by a life insurer's separate account - ANSWERSVariable
Annuity
Cindy buys a 10-year certain annuity with an installment refund. After receiving monthly
payments for 5 years, Cindy dies. How many remaining payments will the insurer make
to her beneficiary? - ANSWERS60 payments
An annuitant would like to determine the current value of her annuity. To do this, she
multiplies the number of "accumulation units" she owns times the unit value of the
"separate account". What kind of annuity BEST matches this description? -
ANSWERSVariable Annuity
An annuitant would like to determine the amount of an annuity distribution that is
exempt from taxation. What is used to calculate this? - ANSWERSExclusion Ratio
What is a common reason people purchase an annuity? - ANSWERSTo protect against
the risk of outliving their financial resources
Which of the following is NOT a feature of equity annuities? - ANSWERSOffers a
maximum interest rate that increases annually
When a mutual insurer becomes a stock company, the process is called -
ANSWERSDemutualization
An insurer owned by its policyholder is called a - ANSWERSMutual insurer
Which of the following statements regarding a life insurance policy dividend is TRUE? -
ANSWERSIt is the distribution of excess of funds accumulated by the insurer on
participating policies
Which of the following is a type of insurance where an insurer transfers loss exposure
from policies written for its insureds? - ANSWERSReinsurance
AAA Insurance Company has transferred a portion of its loss exposure to BBB
Insurance Company. In this reinsurance transaction, what is AAA Insurance Company
called? - ANSWERSPrimary Insurer
, John owns an insurance policy that gives him the right to share in the insurer's surplus.
What kind of policy is this? - ANSWERSParticipating
Kim is insured under a disability income insurance policy with an "own-occupation"
clause. She was recently injured in an automobile accident and can no longer perform
the task of her job. Kim is no considered to be - ANSWERStotally disabled
What are residual disability income insurance payments based on? - ANSWERSThe
amount of the insured's income is reduced by the disability
Dyan is considered partially disabled by her insurance company. Which of the following
BEST describes her situation? - ANSWERSShe is working part-time and receiving lost
income under her long-term disability benefit
Under a disability income insurance policy, which criteria must be met for "bodily injury"
tp be classified as accidental? - ANSWERSThe cause may be intentional, but the result
must be accidental
The elimination period in a disability income policy serves the same purpose -
ANSWERSa deductible
Which of the following is NOT a provision in a disability income policy -
ANSWERSDeductible and coinsurance provision
Allen has a disability income policy with a $2,500 monthly benefit and a 30-day
elimination period. He is unable to work 90 days following an automobile accident. What
will the policy pay? - ANSWERS$5,000 (90 days - 30 days = 60 days or 2 months) 2
months x $2,500
The problem of overinsurance is addressed in which health insurance provision -
ANSWERSCoordination of benefits
When a claimant has coverage under more than one health plan, which group medical
plan provision applies? - ANSWERSCoordination of benefits
The Consolidated Omnibus Budget Reconciliation Act (COBRA) applies to employers
who employ at least - ANSWERS20 employees
Minimum participation standards exist for group health insurance plans in order to -
ANSWERSprevent adverse selection
What percentage of eligible employees must participate in a noncontributory group
health plan before it can be put in effect? - ANSWERS100%
An eligible individual who would like to obtain group health insurance without providing
evidence of insurability must - ANSWERSenroll within a specified eligibility period
