1|Page
Exam FX Practice Test Questions
With Correct Solutions
A qualified plan may not favor whom? - correct -answer-Shareholders & top
executives
Under a credit disability policy, payments will be made to the creditor by the
insured until what point? - correct -answer-Until the insured can return back to
work or until the debt is repaid
An insured receives $50,000 from a $100,000 accidental death & dismemberment
policy as a result of a lost arm in an accident. This benefit is consider a/an - correct
-answer-A capital sum
What's a capital sum - correct -answer-It's the capital amount that's usually 50%
of the principal sum "total amount" , and it's paid for the loss of a single body
part.
,2|Page
What's a collateral assignment ? - correct -answer-When you transfer enough
control to the lender to ensure the repayment of a loan after death. If the loan is
paid off before death the full control returns back to the insured
The partial transfer of policy ownership rights and privileges in a policy to a bank
or lender is called a/an what - correct -answer-Collateral assignment
List 4 characteristics of term life insurance - correct -answer-* temporary
protection
* no cash value
* less expensive
* may be renewed
A blanket policy covers members of what? - correct -answer-Covers members of a
particular group when they are participating in a particular activity
*individuals are automatically covered
*members do not receive a certificate of insurance
, 3|Page
What are the 3 recognized areas in which insurable interest exist ? - correct -
answer-* policy owner insuring:
- his/her own life
- life of a family member ( relative or spouse)
- life of a business partner
- life of a key employee
* a debtor does not have an insurable interest in the creditor
When does the guaranteed insurability rider allow the insured to purchase
additional coverage ? - correct -answer-Specified future dates ( usually every 3
years ) or events ( such as marriage, or birth of a newborn child ) without evidence
of insurability
This "title" makes it illegal for any individual convicted of a crime involving
dishonesty or breach of trust to work in the business of insurance (without what)?
- correct -answer-Title 18, US code , sections 1033-1034
- without a written letter of consent from an insurance regulatory authority
Exam FX Practice Test Questions
With Correct Solutions
A qualified plan may not favor whom? - correct -answer-Shareholders & top
executives
Under a credit disability policy, payments will be made to the creditor by the
insured until what point? - correct -answer-Until the insured can return back to
work or until the debt is repaid
An insured receives $50,000 from a $100,000 accidental death & dismemberment
policy as a result of a lost arm in an accident. This benefit is consider a/an - correct
-answer-A capital sum
What's a capital sum - correct -answer-It's the capital amount that's usually 50%
of the principal sum "total amount" , and it's paid for the loss of a single body
part.
,2|Page
What's a collateral assignment ? - correct -answer-When you transfer enough
control to the lender to ensure the repayment of a loan after death. If the loan is
paid off before death the full control returns back to the insured
The partial transfer of policy ownership rights and privileges in a policy to a bank
or lender is called a/an what - correct -answer-Collateral assignment
List 4 characteristics of term life insurance - correct -answer-* temporary
protection
* no cash value
* less expensive
* may be renewed
A blanket policy covers members of what? - correct -answer-Covers members of a
particular group when they are participating in a particular activity
*individuals are automatically covered
*members do not receive a certificate of insurance
, 3|Page
What are the 3 recognized areas in which insurable interest exist ? - correct -
answer-* policy owner insuring:
- his/her own life
- life of a family member ( relative or spouse)
- life of a business partner
- life of a key employee
* a debtor does not have an insurable interest in the creditor
When does the guaranteed insurability rider allow the insured to purchase
additional coverage ? - correct -answer-Specified future dates ( usually every 3
years ) or events ( such as marriage, or birth of a newborn child ) without evidence
of insurability
This "title" makes it illegal for any individual convicted of a crime involving
dishonesty or breach of trust to work in the business of insurance (without what)?
- correct -answer-Title 18, US code , sections 1033-1034
- without a written letter of consent from an insurance regulatory authority
