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Life and Health Insurance Study Guide
Questions with Detailed Verified Answers
(100% Correct Answers) /Already Graded
A+
A life insurance producer's agency agreement normally authorizes the licensee to
do all of the following EXCEPT:
A. solicit insurance
B. sell insurance
C. issue policies
D. collect premiums
Ans: C. issue policies
at what point must a life insurance applicant be informed of their rights that fall
under the Fair Credit Reporting Act?
A. before the appt is scheduled
B. upon completion of the application
C. at the policy's delivery
D. when the insurer receives the MIB report
Ans: B. upon completion of the application
an insurance applicant must be informed of an investigation regarding his/her
reputation and character according to the:
A. state guaranty association
B. fair labor standards board
C. fair credit reporting
D. national association of insurance commissioners
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Ans: C. fair credit reporting act
insurance policies issued by companies which allow their policymakers to
participate in the favorable experience of the company through payment of
dividends are known as:
A. contributory policies
B. non-contributory policies
C. participating policies
D. non-participating policies
Ans: C. participating policies
insurance policies issued by companies which are owned by stockholders and do
not pay policy dividends are known as:
A. contributory policies
B. non-contributory policies
C. participating policies
D. non-participating policies
Ans: D. non-participating policies
The stated amount or percent of liquid assets that an insurer must have on hand
that will satisfy future obligations to its policyholders is called:
A. credits
B. reserves
C. surplus
D. retention
Ans: B. reserves
which of the following actions require a policy owner to provide proof of
insurability in an Adjustable Life policy?
A. increase face amount
B. decrease fact amount
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C. increase premium-paying period
D. decrease premium payment
Ans: A. increase face amount
the exclusions and conditions of an insurance contract are required to be
conspicuous, plain, and clearly stated. There should be no surprise when an
insurance company denies a claim for a hidden clause. This is called the:
A. principle of adhesion
B. unilateral doctrine
C. doctrine of reasonable expectations
D. contract of authority
Ans: C. doctrine of reasonable expectations
which of the following best describes the functions of insurance?
A. it is a form of legalized gambling
B. it spreads financial risk over a large group to minimize loss to any one
individual
C. it protects against living too long
D. it creates and protects risks
Ans: B. it spreads financial risk over a large group to minimize loss of any one individual
an insurance contract is said to be a ____ because there is a mutual reliance of
truthfulness on both parties:
A. adhesion contract
B. indemnity contract
C. contract of utmost good faith
D. contract of principle
Ans: C. contract of utmost good faith
What does a Face Amount Plus Cash Value Policy supposed to pay at the
insured's death?
Click here for more: Preppass - Stuvia
Life and Health Insurance Study Guide
Questions with Detailed Verified Answers
(100% Correct Answers) /Already Graded
A+
A life insurance producer's agency agreement normally authorizes the licensee to
do all of the following EXCEPT:
A. solicit insurance
B. sell insurance
C. issue policies
D. collect premiums
Ans: C. issue policies
at what point must a life insurance applicant be informed of their rights that fall
under the Fair Credit Reporting Act?
A. before the appt is scheduled
B. upon completion of the application
C. at the policy's delivery
D. when the insurer receives the MIB report
Ans: B. upon completion of the application
an insurance applicant must be informed of an investigation regarding his/her
reputation and character according to the:
A. state guaranty association
B. fair labor standards board
C. fair credit reporting
D. national association of insurance commissioners
,Page | 2
Click here for more: Preppass - Stuvia
Ans: C. fair credit reporting act
insurance policies issued by companies which allow their policymakers to
participate in the favorable experience of the company through payment of
dividends are known as:
A. contributory policies
B. non-contributory policies
C. participating policies
D. non-participating policies
Ans: C. participating policies
insurance policies issued by companies which are owned by stockholders and do
not pay policy dividends are known as:
A. contributory policies
B. non-contributory policies
C. participating policies
D. non-participating policies
Ans: D. non-participating policies
The stated amount or percent of liquid assets that an insurer must have on hand
that will satisfy future obligations to its policyholders is called:
A. credits
B. reserves
C. surplus
D. retention
Ans: B. reserves
which of the following actions require a policy owner to provide proof of
insurability in an Adjustable Life policy?
A. increase face amount
B. decrease fact amount
, Page | 3
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C. increase premium-paying period
D. decrease premium payment
Ans: A. increase face amount
the exclusions and conditions of an insurance contract are required to be
conspicuous, plain, and clearly stated. There should be no surprise when an
insurance company denies a claim for a hidden clause. This is called the:
A. principle of adhesion
B. unilateral doctrine
C. doctrine of reasonable expectations
D. contract of authority
Ans: C. doctrine of reasonable expectations
which of the following best describes the functions of insurance?
A. it is a form of legalized gambling
B. it spreads financial risk over a large group to minimize loss to any one
individual
C. it protects against living too long
D. it creates and protects risks
Ans: B. it spreads financial risk over a large group to minimize loss of any one individual
an insurance contract is said to be a ____ because there is a mutual reliance of
truthfulness on both parties:
A. adhesion contract
B. indemnity contract
C. contract of utmost good faith
D. contract of principle
Ans: C. contract of utmost good faith
What does a Face Amount Plus Cash Value Policy supposed to pay at the
insured's death?
