2025 NJ LIFE INSURANCE EVALUATION QUESTION WITH
ANSWERS 2025/2026
1) The full premium was submitted with the application for life insurance, & the policy
was issued 2 weeks later as requested. When does the policy coverage become
effective?
a) As of policy delivery date
b) As of the first of the month after the policy issue
c) As of the policy issue date
d) As of the application date - d) As of the application date
2) Which of the following is true regarding license cancellation and reinstatement?
a) The producer must allow it to lapse. After that point, it can be reinstated any time
within the next 2 years, provided that the continuing education requirements have been
met
b) The license needs to be returned to the Insurance Department. Once this occurs, it
cannot be reinstated
c) The producer must complete a brief interview with the Commissioner's Office. The
license may then be reinstate within 1 year
d) The license needs to be returned to the Insurance Department. It can be reinstated
by filling out an application and paying a fee - d) The license needs to be returned to the
Insurance Department. It can be reinstated by filling out an application and paying a fee
3) On its advertisement, a company claims that it has funds in its possession that are, in
fact, not available for the payment of losses or claims. The company is guilty of:
a) Twisting
b) Defamation
c) Misrepresentation
d) Coercion - c) Misrepresentation
4) The Waiver of Cost rider is found in what type of insurance?
a) Joint and Survivor
b) Juvenile Life
c) Universal Life
d) Whole Life - c) Universal Life
5) Which rule would apply if an agent knows an applicant is going to cash in an old
policy and use the funds to purchase new insurance?
a) Replacement rule
b) Reinstatement rule
c) Conversion rule
d) Disclosure rule - a) Replacement rule
6) A contract between a producer and an insurance company:
a) Is considered noncancellable
b) Must be in writing and signed by both parties
, c) Can be in writing or a verbal agreement
d) Must be signed by at least one party - b) Must be in writing and signed by both
parties
7) Which of the following explains the policy owner's right to change beneficiaries,
choose options, and receive proceeds of a policy?
a) The Entire Contract Provision
b) The Consideration Clause
c) Assignment Rights
d) Owner's Rights - d) Owner's Rights
8) What significance did Paul vs. Virginia have on the insurance industry?
a) It was decided that insurance requires a separate federal regulatory agency from
Securities products
b) It was decided that insurance licenses should not be issued by the federal
government and should instead be issued by individual states
c) It was decided that insurance was not interstate commerce and could not be
regulated by the federal government
d) It was decided that insurance was interstate commerce and should therefore be
regulated by the federal government - c) It was decided that insurance was not
interstate commerce and could not be regulated by the federal government
9) Which of the following entities is held responsible for the contents of an insurer's
advertisement on local TV station?
a) The insurance company
b) The Department of Insurance
c) The TV station
d) The Guaranty Association - a) The insurance company
10) An underwriter may obtain information on an applicant's hobbies, financial status,
and habits by ordering a(n):
a) Attending Physician Statement
b) Inspection report
c) Medical Information Bureau report
d) Medical examination - b) Inspection report
11) A policy will pay the death benefit if the insured dies during the 20-year premium-
paying period, and nothing if death occurs after the 20-year period. What type of policy
is this?
a) Ordinary life policy
b) Limited pay whole life
c) Level term
d) Term to specified age - c) Level term
ANSWERS 2025/2026
1) The full premium was submitted with the application for life insurance, & the policy
was issued 2 weeks later as requested. When does the policy coverage become
effective?
a) As of policy delivery date
b) As of the first of the month after the policy issue
c) As of the policy issue date
d) As of the application date - d) As of the application date
2) Which of the following is true regarding license cancellation and reinstatement?
a) The producer must allow it to lapse. After that point, it can be reinstated any time
within the next 2 years, provided that the continuing education requirements have been
met
b) The license needs to be returned to the Insurance Department. Once this occurs, it
cannot be reinstated
c) The producer must complete a brief interview with the Commissioner's Office. The
license may then be reinstate within 1 year
d) The license needs to be returned to the Insurance Department. It can be reinstated
by filling out an application and paying a fee - d) The license needs to be returned to the
Insurance Department. It can be reinstated by filling out an application and paying a fee
3) On its advertisement, a company claims that it has funds in its possession that are, in
fact, not available for the payment of losses or claims. The company is guilty of:
a) Twisting
b) Defamation
c) Misrepresentation
d) Coercion - c) Misrepresentation
4) The Waiver of Cost rider is found in what type of insurance?
a) Joint and Survivor
b) Juvenile Life
c) Universal Life
d) Whole Life - c) Universal Life
5) Which rule would apply if an agent knows an applicant is going to cash in an old
policy and use the funds to purchase new insurance?
a) Replacement rule
b) Reinstatement rule
c) Conversion rule
d) Disclosure rule - a) Replacement rule
6) A contract between a producer and an insurance company:
a) Is considered noncancellable
b) Must be in writing and signed by both parties
, c) Can be in writing or a verbal agreement
d) Must be signed by at least one party - b) Must be in writing and signed by both
parties
7) Which of the following explains the policy owner's right to change beneficiaries,
choose options, and receive proceeds of a policy?
a) The Entire Contract Provision
b) The Consideration Clause
c) Assignment Rights
d) Owner's Rights - d) Owner's Rights
8) What significance did Paul vs. Virginia have on the insurance industry?
a) It was decided that insurance requires a separate federal regulatory agency from
Securities products
b) It was decided that insurance licenses should not be issued by the federal
government and should instead be issued by individual states
c) It was decided that insurance was not interstate commerce and could not be
regulated by the federal government
d) It was decided that insurance was interstate commerce and should therefore be
regulated by the federal government - c) It was decided that insurance was not
interstate commerce and could not be regulated by the federal government
9) Which of the following entities is held responsible for the contents of an insurer's
advertisement on local TV station?
a) The insurance company
b) The Department of Insurance
c) The TV station
d) The Guaranty Association - a) The insurance company
10) An underwriter may obtain information on an applicant's hobbies, financial status,
and habits by ordering a(n):
a) Attending Physician Statement
b) Inspection report
c) Medical Information Bureau report
d) Medical examination - b) Inspection report
11) A policy will pay the death benefit if the insured dies during the 20-year premium-
paying period, and nothing if death occurs after the 20-year period. What type of policy
is this?
a) Ordinary life policy
b) Limited pay whole life
c) Level term
d) Term to specified age - c) Level term
