MISSOURI LIFE INSURANCE EXAM LATEST
2025-2026 UPDATE QUESTIONS AND ANSWERS
Face Amount - Answer-Amount payable in the event of death of the
insured. Also called face value, death benefit, policy proceeds, coverage,
stated amount, indemnity amount or proceeds to the beneficiary.
Facultative Reinsurance v. Treaty Reinsurance - Answer-Facultative:
Transferring risk from one insurance
company to another on a policy-by-policy basis.
Treaty: Transferring risk from one insurance
company to another under a blanket agreement.
Fair Credit Reporting Act - Answer-A federal law that protects
consumers in regard to their credit history. Establishes guidelines for
how companies can access consumers' credit reports and what types of
disclosures and notifications are required.
Financial Needs Approach - Answer-In determining how much life
insurance is needed the needs of the surviving family are the focus.
Using needs analysis worksheets, an amount is determined to meet the
needs of the surviving family regardless of the earnings of the insured.
, Fixed Amount Annuity - Answer-A Life Annuity that guarantees a
fixed dollar payment at regular intervals during the lifetime of the
annuitant.
Fixed Amount Settlement Option - Answer-Upon maturity of an
insurance policy the beneficiary receives periodic payments of a set
dollar amount from the policy proceeds.
Free Look Provision - Answer-A policy provision required by state law
that establishes a set number of days (usually 10) for the policyowner to
review a newly issued policy. The policyowner may return the policy to
the insurer during this time for any reason and receive a 100% refund.
Also known as refund provision, unconditional refund provision, return
provision, exchange provision, or right to examine.
Fixed Period Settlement Option - Answer-Upon maturity of an
insurance policy, the beneficiary receives income from the policy
proceeds for a stated period of time.
General Account v. Separate Account - Answer-General Account:
Contains the regulated, or
guaranteed, funds of an insurance company.
Separate Account: Contains the investments of an insurance company.
These investments have no guaranteed rate of return and are regulated
by the SEC and NASD.
, Grace Period - Answer-A prescribed period of time during which the
policy stays in force without the payment of premiums. Mandated by
state law and is usually 30 or 31 days.
Graded Premium Policy - Answer-Premiums for the policy increase
regularly for 5 to 20 years and then level off. Death benefit remains
level.
Group Insurance - Answer-An insurance policy that covers multiple
people (who have a common interest). A Master Policy is issued to the
policyowner and individual insureds receive Certificates of Insurance.
Guaranteed Insurability Rider - Answer-Optional rider that enables the
policyowner to purchase additional amounts of coverage at pre-
determined times without proof of insurability.
Guaranty Association - Answer-A state mandated association of all
insurance companies designed to protect consumers from impaired or
insolvent companies.
Hazard - Answer-Anything that increases the likelihood that a loss will
occur (Faulty wiring).
Human Life Value Approach - Answer-In determining how much life
insurance is needed the worker's annual earnings are multiplied by the
number of years remaining until he/she retires. From the resulting figure
taxes and expenses are subtracted.
2025-2026 UPDATE QUESTIONS AND ANSWERS
Face Amount - Answer-Amount payable in the event of death of the
insured. Also called face value, death benefit, policy proceeds, coverage,
stated amount, indemnity amount or proceeds to the beneficiary.
Facultative Reinsurance v. Treaty Reinsurance - Answer-Facultative:
Transferring risk from one insurance
company to another on a policy-by-policy basis.
Treaty: Transferring risk from one insurance
company to another under a blanket agreement.
Fair Credit Reporting Act - Answer-A federal law that protects
consumers in regard to their credit history. Establishes guidelines for
how companies can access consumers' credit reports and what types of
disclosures and notifications are required.
Financial Needs Approach - Answer-In determining how much life
insurance is needed the needs of the surviving family are the focus.
Using needs analysis worksheets, an amount is determined to meet the
needs of the surviving family regardless of the earnings of the insured.
, Fixed Amount Annuity - Answer-A Life Annuity that guarantees a
fixed dollar payment at regular intervals during the lifetime of the
annuitant.
Fixed Amount Settlement Option - Answer-Upon maturity of an
insurance policy the beneficiary receives periodic payments of a set
dollar amount from the policy proceeds.
Free Look Provision - Answer-A policy provision required by state law
that establishes a set number of days (usually 10) for the policyowner to
review a newly issued policy. The policyowner may return the policy to
the insurer during this time for any reason and receive a 100% refund.
Also known as refund provision, unconditional refund provision, return
provision, exchange provision, or right to examine.
Fixed Period Settlement Option - Answer-Upon maturity of an
insurance policy, the beneficiary receives income from the policy
proceeds for a stated period of time.
General Account v. Separate Account - Answer-General Account:
Contains the regulated, or
guaranteed, funds of an insurance company.
Separate Account: Contains the investments of an insurance company.
These investments have no guaranteed rate of return and are regulated
by the SEC and NASD.
, Grace Period - Answer-A prescribed period of time during which the
policy stays in force without the payment of premiums. Mandated by
state law and is usually 30 or 31 days.
Graded Premium Policy - Answer-Premiums for the policy increase
regularly for 5 to 20 years and then level off. Death benefit remains
level.
Group Insurance - Answer-An insurance policy that covers multiple
people (who have a common interest). A Master Policy is issued to the
policyowner and individual insureds receive Certificates of Insurance.
Guaranteed Insurability Rider - Answer-Optional rider that enables the
policyowner to purchase additional amounts of coverage at pre-
determined times without proof of insurability.
Guaranty Association - Answer-A state mandated association of all
insurance companies designed to protect consumers from impaired or
insolvent companies.
Hazard - Answer-Anything that increases the likelihood that a loss will
occur (Faulty wiring).
Human Life Value Approach - Answer-In determining how much life
insurance is needed the worker's annual earnings are multiplied by the
number of years remaining until he/she retires. From the resulting figure
taxes and expenses are subtracted.
