PRIMERICA LIFE INSURANCE EXAM( $st $st $st
QUESTIONS WITH CORRECT
$st $st $st
ANSWERS)2025
An $stinsured $stpurchased $stan $stinsurance $stpolicy $st5 $styears $stago. $stLast $styear, $stshe
$streceived $sta $stdividend $stcheck $stfrom $stthe $stinsurance $stcompany $stthat $stwas $stnot
$sttaxable. $stThis $styear, $stshe $stdid $stnot $streceive $sta $stcheck $stfrom $stthe $stinsurer. $stFrom
$stwhat $sttype $stof $stinsurer $stdid $stthe $stinsured $stpurchase $stthe $stpolicy?
a. mutual
b. reciprocal
c. nonprofit $stservice $storganization
d. stock $st- $stAnswer $stA. $stmutual
funds $stnot $stpaid $stout $stafter $stpaying $stclaims $stand $stother $stoperating $stcosts $stare
$streturned $stto $stthe $stpolicy $stowners $stin $stthe $stform $stof $sta $stdividend. $stif $stall $stfunds $stare
$stpaid $stout, $stno $stdividends $stare $stpaid
Following $sta $stcareer $stchange, $stan $stinsured $stis $stno $stlonger $strequired $stto $stperform
$stmany $stphysical $stactivities, $stso $sthe $sthas $stimplemented $sta $stprogram $stwhere $sthe
$stwalks $stand $stjogs $stfor $st45 $stminutes $steach $stmorning. $stThe $stinsured $sthas $stalso
$steliminated $stmost $stfatty $stfoods $stfrom $sthis $stdiet. $stWhich $stmethod $stof $stdealing $stwith
$strisk $stdoes $stthis $stscenario $stdescribe?
a. retention
b. reduction
c. transfer
d. avoidance $st- $stAnswer $stB. $streduction
the $stinsured's $stchange $stin $stlifestyle $stand $sthabits $stwould $stlikely $streduce $stthe $stchances
$stof $sthealth $stproblems
In $stinsurance, $stan $stoffer $stis $stusually $stmade $stwhen
a. an $stapplicant $stsubmits $stan $stapplication $stto $stthe $stinsurer
b. the $stinsurer $stapproves $stthe $stapplication $stand $streceives $stthe $stinitial $stpremium
c. the $stagent $sthands $stthe $stpolicy $stto $stthe $stpolicyholder
d. an $stagent $stexplains $sta $stpolicy $stto $sta $stpotential $stapplicant $st- $stAnswer $stA. $stan
$stapplicant $stsubmits $stan $stapplication $stto $stthe $stinsurer
in $stinsurance, $stthe $stoffer $stis $stusually $stmade $stby $stthe $stapplicant $stin $stthe $stform $stof $stan
$stapplication. $stacceptance $sttakes $stplace $stwhen $stan $stinsurer's $stunderwriter $stapproves
$stthe $stapplication $stand $stissues $sta $stpolicy
the $stcauses $stof $stloss $stinsured $stagainst $stin $stan $stinsurance $stpolicy $stare $stknown $stas
a. perils
b. losses
c. risks
d. hazards $st- $stAnswer $stA. $stperils
,PRIMERICA LIFE INSURANCE EXAM( $st $st $st
QUESTIONS WITH CORRECT
$st $st $st
ANSWERS)2025
perils $stare $stthe $stcauses $stof $stloss $stinsured $stagainst $stin $stan $stinsurance $stpolicy
what $stdocumentation $stgrants $stexpress $stauthority $stto $stan $stagent?
a. agents $stcontract $stwith $stthe $stprincipal
b. agents $stinsurance $stlicense
c. fiduciary $stcontract
d. state $stprovisions $st- $stAnswer $stA. $stagents $stcontract $stwith $stthe $stprincipal
the $stprincipal $stgrants $stauthority $stto $stan $stagent $stthrough $stthe $stagent's $stcontract
which $stof $stthe $stfollowing $stbest $stdescribes $stan $stinsurance $stcompany $stthat $sthas $stbeen
$stformed $stunder $stthe $stlaws $stof $stthis $ststate?
a. domestic
b. sovereign
c. alien
d. foreign $st- $stAnswer $stA. $stdomestic
a $stcompany $stis $stdomestic $stwhen $stdoing $stbusiness $stwithin $stthe $ststate $stin $stwhich $stit $stis
$stincorporated
which $stof $stthe $stfollowing $stfactors $stis $stNOT $stconsidered $stby $stan $stunderwriter $stwhen
$stdetermining $stthe $stpremium $strates $stfor $stan $stindividual $stseeking $stinsurance?
a. medical $sthistory
b. sex
c. age
d. race $st- $stAnswer $stD. $strace
age, $stmedical $sthistory, $stand $stsex $stprovide $stsound $ststatistical $stdate $stfor $stdetermining
$stthe $stprobability $stof $stloss. $stRace, $streligion, $stsexual $storientation, $stetc. $stare $stthe
$stfactors $stthat $stcannot $stbe $stused $stbecause $stthere $stis $stnot $stsound $ststatistical $stdata $stto
$stshow $stthat $stthey $steffect $stthe $stprobability $stof $stloss; $sttherefore, $stthey $stare
$stconsidered $stto $stbe $stdiscriminatory
in $stinsurance $sttransactions, $stfiduciary $stresponsibility $stmeans
a. handling $stinsurer $stfunds $stin $sta $sttrust $stcapacity
b. maintaining $stgood $stcredit $strecord
c. being $stliable $stwith $strespect $stto $stpayment $stof $stclaims
d. commingling $stpremiums $stwith $stagents $stpersonal $stfunds $st- $stAnswer $stA. $sthandling
$stinsurer $stfunds $stin $sta $sttrust $stcapacity
an $stagents $stfiduciary $stresponsibility $stincludes $sthandling $stinsurer $stfunds $stin $sta $sttrust
$stcapacity
the $stauthority $stgranted $stto $stan $stagent $stthrough $stthe $stagent's $stcontract $stis $streferred $stto $s
,PRIMERICA LIFE INSURANCE EXAM(
$st $st $st
QUESTIONS WITH CORRECT
$st $st $st
ANSWERS)2025
a. absolute authority
b. express authority
c. apparent authority
d. implied authority - Answer B. express authority
express powers are written into the contract between the insurer and the agent
insurance policies are not drawn up though negotiations, and an insured has little to
say about its provisions. what contract characteristic does this describe?
a. unilateral
b. conditional
c. personal
d. adhesion - Answer D. adhesion
a contract of adhesion is prepared by only the insurer; the insured's only option is to
accept or reject the policy as its written
which of the following insurers are owned by stockholders who have the usual rights
of ownership, including the right of voting?
a. reciprocal
b. fraternal
c. stock
d. mutual - Answer C. stock
only stock insurance companies are owned and controlled by stockholders
which of the following best describes the concept that the insured pays a small
amount of premium for a large amount of risk on the part of the insurance company?
a. subrogation
b. warranty
c. aleatory
d. adhesion - Answer C. aleatory
an insurance contract is an aleatory contract in that it requires a relatively small
amount of premium for a large risk
When an insured makes truthful statements on the application for insurance and
pays the required premium, it is known as which of the following?
a. legal purpose
b. contract of adhesion
c. acceptance
, PRIMERICA LIFE INSURANCE EXAM( $st $st $st
QUESTIONS WITH CORRECT
$st $st $st
ANSWERS)2025
d. consideration $st- $stAnswer $stD. $stconsideration
consideration $stis $stsomething $stof $stvalue $stthat $steach $stparty $stgives $stto $stthe $stother.
$stThe $stconsideration $ston $stthe $stpart $stof $stthe $stinsured $stis $stthe $stpayment $stof $stpremium
$stand $stthe $strepresentations $stmade $stin $stthe $stapplication
which $stof $stthe $stfollowing $stwould $stqualify $stas $sta $stcompetent $stparty $stin $stan $stinsurance
$stcontract?
a. the $stapplicant $stis $stintoxicated $stat $stthe $sttime $stof $stapplication
b. the $stapplicant $stis $st12 $styear $stold $ststudent
c. the $stapplicant $stis $stunder $stthe $stinfluence $stof $sta $stmind-impairing $stmedication $stat
$stthe $sttime $stof $stapplication
d. the $stapplicant $sthas $sta $stprior $stfelony $stconviction $st- $stAnswer $stD. $stthe $stapplicant
$sthas $sta $stprior $stfelony $stconviction
when $stan $stinsurer $stand $stinsured $stenter $stinto $sta $stcontract, $stboth $stparties $stmust $stbe
$stlegal $stof $stage $stand $stmentally $stcompetent. $stIt $stis $stlegal $stfor $sta $stperson $stconvicted $stof
$sta $stfelony $stto $stbuy $stan $stinsurance $stcontract. $stAn $stintoxicated $stperson, $sthowever,
$stmay $stnot $stbe $stmentally $stcompetent, $sta $st12 $styear $stold $ststudent $stis $stconsidered $stto
$stbe $stunderage $stin $stmost $ststates $stand $sta $stperson $stunder $stmind-impairing $stmedication
$stmost $stlikely $stwould $stnot $stbe $stmentally $stcompetent
an $stinsurer $stneglects $stto $stpay $sta $stlegitimate $stclaim $stthat $stis $stcovered $stunder $stthe
$stterms $stof $stthe $stpolicy. $stWhich $stof $stthe $stfollowing $stinsurance $stprinciples $sthas $stthe
$stinsurer $stviolated?
a. representation
b. adhesion
c. consideration
d. good $sthealth $st- $stAnswer $stC. $stconsideration
the $stbinding $stforce $stin $stany $stcontract $stis $stconsideration. $stconsideration $ston $stthe $stpart
$stof $stthe $stinsureds $stthe $stpayment $stof $stpremiums $stand $stthe $sthealth $strepresentations
$stmade $stin $stthe $stapplication. $stConsideration $ston $stthe $stpart $stof $stthe $stinsurer $stis $stthe
$stpromise $stto $stpay $stin $stthe $steven $stof $stloss
which $stof $stthe $stfollowing $stis $sta $stprimary $stsource $stof $stinformation $stused $stfor $stinsurance
$stunderwriting?
a. application
b. applicant $stinterviews
c. medical $strecords.
d. private $stinvestigations $st- $stAnswer $stA. $stapplication
the $stapplication $stcontains $stmost $stof $stthe $stinformation $stused $stfor $stunderwriting
$stpurposes. $stthis $stis $stwhy $stits $stcompleteness $stand $staccurarcy $stare $stso $stcritical
QUESTIONS WITH CORRECT
$st $st $st
ANSWERS)2025
An $stinsured $stpurchased $stan $stinsurance $stpolicy $st5 $styears $stago. $stLast $styear, $stshe
$streceived $sta $stdividend $stcheck $stfrom $stthe $stinsurance $stcompany $stthat $stwas $stnot
$sttaxable. $stThis $styear, $stshe $stdid $stnot $streceive $sta $stcheck $stfrom $stthe $stinsurer. $stFrom
$stwhat $sttype $stof $stinsurer $stdid $stthe $stinsured $stpurchase $stthe $stpolicy?
a. mutual
b. reciprocal
c. nonprofit $stservice $storganization
d. stock $st- $stAnswer $stA. $stmutual
funds $stnot $stpaid $stout $stafter $stpaying $stclaims $stand $stother $stoperating $stcosts $stare
$streturned $stto $stthe $stpolicy $stowners $stin $stthe $stform $stof $sta $stdividend. $stif $stall $stfunds $stare
$stpaid $stout, $stno $stdividends $stare $stpaid
Following $sta $stcareer $stchange, $stan $stinsured $stis $stno $stlonger $strequired $stto $stperform
$stmany $stphysical $stactivities, $stso $sthe $sthas $stimplemented $sta $stprogram $stwhere $sthe
$stwalks $stand $stjogs $stfor $st45 $stminutes $steach $stmorning. $stThe $stinsured $sthas $stalso
$steliminated $stmost $stfatty $stfoods $stfrom $sthis $stdiet. $stWhich $stmethod $stof $stdealing $stwith
$strisk $stdoes $stthis $stscenario $stdescribe?
a. retention
b. reduction
c. transfer
d. avoidance $st- $stAnswer $stB. $streduction
the $stinsured's $stchange $stin $stlifestyle $stand $sthabits $stwould $stlikely $streduce $stthe $stchances
$stof $sthealth $stproblems
In $stinsurance, $stan $stoffer $stis $stusually $stmade $stwhen
a. an $stapplicant $stsubmits $stan $stapplication $stto $stthe $stinsurer
b. the $stinsurer $stapproves $stthe $stapplication $stand $streceives $stthe $stinitial $stpremium
c. the $stagent $sthands $stthe $stpolicy $stto $stthe $stpolicyholder
d. an $stagent $stexplains $sta $stpolicy $stto $sta $stpotential $stapplicant $st- $stAnswer $stA. $stan
$stapplicant $stsubmits $stan $stapplication $stto $stthe $stinsurer
in $stinsurance, $stthe $stoffer $stis $stusually $stmade $stby $stthe $stapplicant $stin $stthe $stform $stof $stan
$stapplication. $stacceptance $sttakes $stplace $stwhen $stan $stinsurer's $stunderwriter $stapproves
$stthe $stapplication $stand $stissues $sta $stpolicy
the $stcauses $stof $stloss $stinsured $stagainst $stin $stan $stinsurance $stpolicy $stare $stknown $stas
a. perils
b. losses
c. risks
d. hazards $st- $stAnswer $stA. $stperils
,PRIMERICA LIFE INSURANCE EXAM( $st $st $st
QUESTIONS WITH CORRECT
$st $st $st
ANSWERS)2025
perils $stare $stthe $stcauses $stof $stloss $stinsured $stagainst $stin $stan $stinsurance $stpolicy
what $stdocumentation $stgrants $stexpress $stauthority $stto $stan $stagent?
a. agents $stcontract $stwith $stthe $stprincipal
b. agents $stinsurance $stlicense
c. fiduciary $stcontract
d. state $stprovisions $st- $stAnswer $stA. $stagents $stcontract $stwith $stthe $stprincipal
the $stprincipal $stgrants $stauthority $stto $stan $stagent $stthrough $stthe $stagent's $stcontract
which $stof $stthe $stfollowing $stbest $stdescribes $stan $stinsurance $stcompany $stthat $sthas $stbeen
$stformed $stunder $stthe $stlaws $stof $stthis $ststate?
a. domestic
b. sovereign
c. alien
d. foreign $st- $stAnswer $stA. $stdomestic
a $stcompany $stis $stdomestic $stwhen $stdoing $stbusiness $stwithin $stthe $ststate $stin $stwhich $stit $stis
$stincorporated
which $stof $stthe $stfollowing $stfactors $stis $stNOT $stconsidered $stby $stan $stunderwriter $stwhen
$stdetermining $stthe $stpremium $strates $stfor $stan $stindividual $stseeking $stinsurance?
a. medical $sthistory
b. sex
c. age
d. race $st- $stAnswer $stD. $strace
age, $stmedical $sthistory, $stand $stsex $stprovide $stsound $ststatistical $stdate $stfor $stdetermining
$stthe $stprobability $stof $stloss. $stRace, $streligion, $stsexual $storientation, $stetc. $stare $stthe
$stfactors $stthat $stcannot $stbe $stused $stbecause $stthere $stis $stnot $stsound $ststatistical $stdata $stto
$stshow $stthat $stthey $steffect $stthe $stprobability $stof $stloss; $sttherefore, $stthey $stare
$stconsidered $stto $stbe $stdiscriminatory
in $stinsurance $sttransactions, $stfiduciary $stresponsibility $stmeans
a. handling $stinsurer $stfunds $stin $sta $sttrust $stcapacity
b. maintaining $stgood $stcredit $strecord
c. being $stliable $stwith $strespect $stto $stpayment $stof $stclaims
d. commingling $stpremiums $stwith $stagents $stpersonal $stfunds $st- $stAnswer $stA. $sthandling
$stinsurer $stfunds $stin $sta $sttrust $stcapacity
an $stagents $stfiduciary $stresponsibility $stincludes $sthandling $stinsurer $stfunds $stin $sta $sttrust
$stcapacity
the $stauthority $stgranted $stto $stan $stagent $stthrough $stthe $stagent's $stcontract $stis $streferred $stto $s
,PRIMERICA LIFE INSURANCE EXAM(
$st $st $st
QUESTIONS WITH CORRECT
$st $st $st
ANSWERS)2025
a. absolute authority
b. express authority
c. apparent authority
d. implied authority - Answer B. express authority
express powers are written into the contract between the insurer and the agent
insurance policies are not drawn up though negotiations, and an insured has little to
say about its provisions. what contract characteristic does this describe?
a. unilateral
b. conditional
c. personal
d. adhesion - Answer D. adhesion
a contract of adhesion is prepared by only the insurer; the insured's only option is to
accept or reject the policy as its written
which of the following insurers are owned by stockholders who have the usual rights
of ownership, including the right of voting?
a. reciprocal
b. fraternal
c. stock
d. mutual - Answer C. stock
only stock insurance companies are owned and controlled by stockholders
which of the following best describes the concept that the insured pays a small
amount of premium for a large amount of risk on the part of the insurance company?
a. subrogation
b. warranty
c. aleatory
d. adhesion - Answer C. aleatory
an insurance contract is an aleatory contract in that it requires a relatively small
amount of premium for a large risk
When an insured makes truthful statements on the application for insurance and
pays the required premium, it is known as which of the following?
a. legal purpose
b. contract of adhesion
c. acceptance
, PRIMERICA LIFE INSURANCE EXAM( $st $st $st
QUESTIONS WITH CORRECT
$st $st $st
ANSWERS)2025
d. consideration $st- $stAnswer $stD. $stconsideration
consideration $stis $stsomething $stof $stvalue $stthat $steach $stparty $stgives $stto $stthe $stother.
$stThe $stconsideration $ston $stthe $stpart $stof $stthe $stinsured $stis $stthe $stpayment $stof $stpremium
$stand $stthe $strepresentations $stmade $stin $stthe $stapplication
which $stof $stthe $stfollowing $stwould $stqualify $stas $sta $stcompetent $stparty $stin $stan $stinsurance
$stcontract?
a. the $stapplicant $stis $stintoxicated $stat $stthe $sttime $stof $stapplication
b. the $stapplicant $stis $st12 $styear $stold $ststudent
c. the $stapplicant $stis $stunder $stthe $stinfluence $stof $sta $stmind-impairing $stmedication $stat
$stthe $sttime $stof $stapplication
d. the $stapplicant $sthas $sta $stprior $stfelony $stconviction $st- $stAnswer $stD. $stthe $stapplicant
$sthas $sta $stprior $stfelony $stconviction
when $stan $stinsurer $stand $stinsured $stenter $stinto $sta $stcontract, $stboth $stparties $stmust $stbe
$stlegal $stof $stage $stand $stmentally $stcompetent. $stIt $stis $stlegal $stfor $sta $stperson $stconvicted $stof
$sta $stfelony $stto $stbuy $stan $stinsurance $stcontract. $stAn $stintoxicated $stperson, $sthowever,
$stmay $stnot $stbe $stmentally $stcompetent, $sta $st12 $styear $stold $ststudent $stis $stconsidered $stto
$stbe $stunderage $stin $stmost $ststates $stand $sta $stperson $stunder $stmind-impairing $stmedication
$stmost $stlikely $stwould $stnot $stbe $stmentally $stcompetent
an $stinsurer $stneglects $stto $stpay $sta $stlegitimate $stclaim $stthat $stis $stcovered $stunder $stthe
$stterms $stof $stthe $stpolicy. $stWhich $stof $stthe $stfollowing $stinsurance $stprinciples $sthas $stthe
$stinsurer $stviolated?
a. representation
b. adhesion
c. consideration
d. good $sthealth $st- $stAnswer $stC. $stconsideration
the $stbinding $stforce $stin $stany $stcontract $stis $stconsideration. $stconsideration $ston $stthe $stpart
$stof $stthe $stinsureds $stthe $stpayment $stof $stpremiums $stand $stthe $sthealth $strepresentations
$stmade $stin $stthe $stapplication. $stConsideration $ston $stthe $stpart $stof $stthe $stinsurer $stis $stthe
$stpromise $stto $stpay $stin $stthe $steven $stof $stloss
which $stof $stthe $stfollowing $stis $sta $stprimary $stsource $stof $stinformation $stused $stfor $stinsurance
$stunderwriting?
a. application
b. applicant $stinterviews
c. medical $strecords.
d. private $stinvestigations $st- $stAnswer $stA. $stapplication
the $stapplication $stcontains $stmost $stof $stthe $stinformation $stused $stfor $stunderwriting
$stpurposes. $stthis $stis $stwhy $stits $stcompleteness $stand $staccurarcy $stare $stso $stcritical
