Loma 280 Exam 2025 Questions and
Answers
401K Plan - ✔✔In the United States, a type of savings plan that allows employees to
make contributions on a pre tax basis. (12)
absolute assignment - ✔✔An assignment of a life insurance policy under which the
policy owner transfers all of his policy ownership rights to the assignee. Contrast with
collateral assignment. (9)
accelerated death benefit - ✔✔A supplemental life insurance policy benefit which
provides that a policy owner may elect to receive all or part of the policy's death benefit
before the insured's death if certain conditions are met. Also known as a living benefit
(7)
acceptance - ✔✔The offeree's unqualified agreement to be bound to the terms of the
offer (3)
accidental death and dismemberment (AD&D) benefit - ✔✔A supplemental life
insurance policy benefit that provides an accidental death benefit and provides a
dismemberment benefit payable if an accident causes the insured to lose any two limbs
or sight in both eyes (7)
accidental death benefit - ✔✔A supplemental life insurance policy benefit that provides
a death benefit in addition to the policy's basic death benefit if the insured dies as a
result of an accident (7)
accumulated value - ✔✔During a deferred annuity's accumulation period, the amount
paid for the deferred annuity, plus the investment earnings, minus the amount of any
withdrawals and fees. Also known as accumulation value or income value.
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 1
,accumulation period - ✔✔The period between the contract owner's purchase of a
deferred annuity and the beginning of the payout period.(10)
actively-at-work provision - ✔✔a group insurance policy provision which states that, in
order to be eligible for coverage, an employee must be actively at work rather than ill or
on leave on the day the insurance coverage is to take effect (11)
accumulation at interest dividend option - ✔✔A policy dividend option under which
the policy dividends are left on deposit with the insurer to accumulate at interest. (9)
activities of daily living (ADLs) - ✔✔The activities of eating, bathing, dressing,
continence, toileting, or transferring into or out of a be, chair, or wheelchair. (13)
antiselection - ✔✔The tendency of individuals who believe they have a greater than
likelihood of loss to seek insurance protection to a greater extent than do other
individuals. Also known as adverse selection or selection against the insurer (1)
applicant - ✔✔The person or business that applies for an insurance policy (1)
asset - ✔✔An item of value that a company owns. Examples of assets include cash
buildings, and investments. (2)
assignee - ✔✔The party to whom life insurance property rights are transferred. (9)
assignment - ✔✔An agreement under which an insurance policy owner transfers some
or all of his ownership rights in the policy to another party (9)
assignment provision - ✔✔A life insurance policy provision which describes the roles of
the insurer and the policy owner when the policy is assigned. (9)
assignor - ✔✔The policy owner who makes an assignment of a life insurance policy (9)
attachment point - ✔✔For stop loss insurance, the total dollar amount of claims that the
employer must pay within a stated period of time before the stop loss insurer begins to
reimburse the employer. Sometimes referred to as the aggregate deductible (14)
attained age - ✔✔The age an insured has reached (attained) on a specified date (5)
attained age conversion - ✔✔A conversion of a term life insurance policy to a cash value
life insurance policy in which the premium rate for the case value policy is based on the
insured's age at the time the policy is converted. Contrast with original age conversion
(5)
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 2
,automatic dividend option - ✔✔A specified policy dividend option that the insurer will
apply if the policy owner deos not choose an option (9)
automatic nonforfeiture benefit - ✔✔A specified policy dividend option that the insurer
will apply if a policy owner does not choose an option (8)
automatic premium loan (APL) option - ✔✔A cash value life insurance policy non-
forfeiture option under which the insurer will automatically pay an overdue premium
for the policy owner by making a loan against the policy's cash value as long as the cash
value equals or exceeds the amount of the premium due (8)
back-end sales charge - ✔✔An amount charged to an annuity contract owner when she
withdraws money from a contract. Also known as a surrender charge (10)
actuarial assumption - ✔✔The assumed values used in the financial design of a product
(4)
actuary - ✔✔An expert in financial risk management and the mathematics and
modeling of insurance, annuities and financial instruments (4)
additional term insurance dividend option - ✔✔A policy dividend option under which
the insurer uses each policy dividend to purchase one year term insurance on the
insured's life (9)
administrative services only (ASO) contract - ✔✔A contract under which an insurer or
other organization agrees to provide some or all administrative services for a self
insured group health insurance plan (14)
aggregate stop loss insurance - ✔✔Stop loss insurance under which the stop loss insurer
begins to reimburse the employer for claims when the employer's total claims exceed a
stated dollar amount within a stated period of time (14)
aleatory contract - ✔✔A contract under which one party provides something of value to
another party in exchange for a conditional promise. Contrast with commutative
contract (3)
allowable expenses - ✔✔Those reasonable and customary expenses that an insured
incurred and that are covered under the insured's group medical expense plans (14)
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 3
, Annual Statement - ✔✔An accounting report which every U.S. insurer prepares each
calendar year and files with the insurance department in each state in which it operates.
(2)
annuitant - ✔✔The person whose lifetime is used to determine the amount of benefits
payable under an annuity contract. (10)
annuity - ✔✔a series of periodic payments(10)
annuity contract - ✔✔A contract under which an insurer promises to make a series of
periodic payments to a named individual in exchange for a premium or series of
premiums (10)
annuity period - ✔✔The time span between each of the payments in the series of
periodic annuity payments (10)
bargaining contract - ✔✔A contract in which both parties, as equals, set the terms and
conditions of the contract. Contrast with contract of adhesion (3)
basic medical expense coverage - ✔✔Medical expense insurance coverage providing
separate benefits for each type of covered medical care cost. Basic coverage typically
provides benefits for hospital, surgical and physicians' expenses. (13)
beneficiary - ✔✔The person or party the policy owner names to receive the the life
insurance policy benefit (1)
benefit formula - ✔✔A formula that describes the calculation of a plan's financial
obligation to participants in a retirement plan (12)
benefit period - ✔✔The time during which the insurer agrees to pay income benefits to
the insured under a disability income or long term care insurance policy. (13)
benefit schedule - ✔✔A schedule included in a group life insurance policy that defines
the amount of life insurance the policy provides for each insured (11)
benefit trigger - ✔✔A long term care insurance policy requirement specifying the
conditions that establish an insured's eligibility to receive long term care benefits. (13)
bilateral contract - ✔✔A contract in which both parties make legally enforceable
promises which they enter into the contract. Contrast with unilateral contract (3)
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 4
Answers
401K Plan - ✔✔In the United States, a type of savings plan that allows employees to
make contributions on a pre tax basis. (12)
absolute assignment - ✔✔An assignment of a life insurance policy under which the
policy owner transfers all of his policy ownership rights to the assignee. Contrast with
collateral assignment. (9)
accelerated death benefit - ✔✔A supplemental life insurance policy benefit which
provides that a policy owner may elect to receive all or part of the policy's death benefit
before the insured's death if certain conditions are met. Also known as a living benefit
(7)
acceptance - ✔✔The offeree's unqualified agreement to be bound to the terms of the
offer (3)
accidental death and dismemberment (AD&D) benefit - ✔✔A supplemental life
insurance policy benefit that provides an accidental death benefit and provides a
dismemberment benefit payable if an accident causes the insured to lose any two limbs
or sight in both eyes (7)
accidental death benefit - ✔✔A supplemental life insurance policy benefit that provides
a death benefit in addition to the policy's basic death benefit if the insured dies as a
result of an accident (7)
accumulated value - ✔✔During a deferred annuity's accumulation period, the amount
paid for the deferred annuity, plus the investment earnings, minus the amount of any
withdrawals and fees. Also known as accumulation value or income value.
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 1
,accumulation period - ✔✔The period between the contract owner's purchase of a
deferred annuity and the beginning of the payout period.(10)
actively-at-work provision - ✔✔a group insurance policy provision which states that, in
order to be eligible for coverage, an employee must be actively at work rather than ill or
on leave on the day the insurance coverage is to take effect (11)
accumulation at interest dividend option - ✔✔A policy dividend option under which
the policy dividends are left on deposit with the insurer to accumulate at interest. (9)
activities of daily living (ADLs) - ✔✔The activities of eating, bathing, dressing,
continence, toileting, or transferring into or out of a be, chair, or wheelchair. (13)
antiselection - ✔✔The tendency of individuals who believe they have a greater than
likelihood of loss to seek insurance protection to a greater extent than do other
individuals. Also known as adverse selection or selection against the insurer (1)
applicant - ✔✔The person or business that applies for an insurance policy (1)
asset - ✔✔An item of value that a company owns. Examples of assets include cash
buildings, and investments. (2)
assignee - ✔✔The party to whom life insurance property rights are transferred. (9)
assignment - ✔✔An agreement under which an insurance policy owner transfers some
or all of his ownership rights in the policy to another party (9)
assignment provision - ✔✔A life insurance policy provision which describes the roles of
the insurer and the policy owner when the policy is assigned. (9)
assignor - ✔✔The policy owner who makes an assignment of a life insurance policy (9)
attachment point - ✔✔For stop loss insurance, the total dollar amount of claims that the
employer must pay within a stated period of time before the stop loss insurer begins to
reimburse the employer. Sometimes referred to as the aggregate deductible (14)
attained age - ✔✔The age an insured has reached (attained) on a specified date (5)
attained age conversion - ✔✔A conversion of a term life insurance policy to a cash value
life insurance policy in which the premium rate for the case value policy is based on the
insured's age at the time the policy is converted. Contrast with original age conversion
(5)
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 2
,automatic dividend option - ✔✔A specified policy dividend option that the insurer will
apply if the policy owner deos not choose an option (9)
automatic nonforfeiture benefit - ✔✔A specified policy dividend option that the insurer
will apply if a policy owner does not choose an option (8)
automatic premium loan (APL) option - ✔✔A cash value life insurance policy non-
forfeiture option under which the insurer will automatically pay an overdue premium
for the policy owner by making a loan against the policy's cash value as long as the cash
value equals or exceeds the amount of the premium due (8)
back-end sales charge - ✔✔An amount charged to an annuity contract owner when she
withdraws money from a contract. Also known as a surrender charge (10)
actuarial assumption - ✔✔The assumed values used in the financial design of a product
(4)
actuary - ✔✔An expert in financial risk management and the mathematics and
modeling of insurance, annuities and financial instruments (4)
additional term insurance dividend option - ✔✔A policy dividend option under which
the insurer uses each policy dividend to purchase one year term insurance on the
insured's life (9)
administrative services only (ASO) contract - ✔✔A contract under which an insurer or
other organization agrees to provide some or all administrative services for a self
insured group health insurance plan (14)
aggregate stop loss insurance - ✔✔Stop loss insurance under which the stop loss insurer
begins to reimburse the employer for claims when the employer's total claims exceed a
stated dollar amount within a stated period of time (14)
aleatory contract - ✔✔A contract under which one party provides something of value to
another party in exchange for a conditional promise. Contrast with commutative
contract (3)
allowable expenses - ✔✔Those reasonable and customary expenses that an insured
incurred and that are covered under the insured's group medical expense plans (14)
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 3
, Annual Statement - ✔✔An accounting report which every U.S. insurer prepares each
calendar year and files with the insurance department in each state in which it operates.
(2)
annuitant - ✔✔The person whose lifetime is used to determine the amount of benefits
payable under an annuity contract. (10)
annuity - ✔✔a series of periodic payments(10)
annuity contract - ✔✔A contract under which an insurer promises to make a series of
periodic payments to a named individual in exchange for a premium or series of
premiums (10)
annuity period - ✔✔The time span between each of the payments in the series of
periodic annuity payments (10)
bargaining contract - ✔✔A contract in which both parties, as equals, set the terms and
conditions of the contract. Contrast with contract of adhesion (3)
basic medical expense coverage - ✔✔Medical expense insurance coverage providing
separate benefits for each type of covered medical care cost. Basic coverage typically
provides benefits for hospital, surgical and physicians' expenses. (13)
beneficiary - ✔✔The person or party the policy owner names to receive the the life
insurance policy benefit (1)
benefit formula - ✔✔A formula that describes the calculation of a plan's financial
obligation to participants in a retirement plan (12)
benefit period - ✔✔The time during which the insurer agrees to pay income benefits to
the insured under a disability income or long term care insurance policy. (13)
benefit schedule - ✔✔A schedule included in a group life insurance policy that defines
the amount of life insurance the policy provides for each insured (11)
benefit trigger - ✔✔A long term care insurance policy requirement specifying the
conditions that establish an insured's eligibility to receive long term care benefits. (13)
bilateral contract - ✔✔A contract in which both parties make legally enforceable
promises which they enter into the contract. Contrast with unilateral contract (3)
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 4
