PRIMERICA PRACTICE TEST QUESTIONS WITH
CORRECT ANSWERS GRADED A+
1. Which of the following annuity products requires an agent to hold a securities
license? Answer: variable annuities
2. What is the purpose of the grace period in life insurance policies? Answer: to
protect the policyowner against an unintentional lapse of the policy
3. An annuity that is purchased with a lump-sum payment, and begins payments within
one year is a: Answer: single premium immediate annuity
4. If the cash value exceeds the premiums paid in a whole life policy, what is taxable
when surrendered? Answer: the portion that exceeds the premiums paid
5. Two business partners own life insurance on each other. Which contract lets the
survivor buy the deceased partner’s interest? Answer: buy-sell agreement
6. When an insurer mails a policy and relinquishes control, the policy is considered:
Answer: delivered
7. Which statement is INCORRECT concerning policy dividends? Answer: the
insurer may guarantee dividends
8. Statements in an insurance application that are believed to be true are called:
Answer: representations
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, 9. Which of the following would be considered a flexible premium policy? Answer:
universal life
10. The premium payment mode is best described as the: Answer: frequency of
premium payments
11. Which feature of Equity Indexed Whole Life is NOT fixed? Answer: cash
value growth
12. What type of permanent insurance allows premiums to be completely paid in a
set period? Answer: limited payment life
13. A settlement option that pays a fixed amount until proceeds run out is:
Answer: fixed-amount installments
14. An insurance agent represents the: Answer: insurer
15. A fixed annuity does all of the following EXCEPT: Answer: provides an
interest rate that is the lesser of the guaranteed or current rate
16. What do employees covered under group life insurance receive? Answer:
certificate of insurance
17. The “pay-in” phase of an annuity is known as the: Answer: accumulation
period
18. Which law forms the basis of statistical loss prediction? Answer: law of large
numbers
2/5
CORRECT ANSWERS GRADED A+
1. Which of the following annuity products requires an agent to hold a securities
license? Answer: variable annuities
2. What is the purpose of the grace period in life insurance policies? Answer: to
protect the policyowner against an unintentional lapse of the policy
3. An annuity that is purchased with a lump-sum payment, and begins payments within
one year is a: Answer: single premium immediate annuity
4. If the cash value exceeds the premiums paid in a whole life policy, what is taxable
when surrendered? Answer: the portion that exceeds the premiums paid
5. Two business partners own life insurance on each other. Which contract lets the
survivor buy the deceased partner’s interest? Answer: buy-sell agreement
6. When an insurer mails a policy and relinquishes control, the policy is considered:
Answer: delivered
7. Which statement is INCORRECT concerning policy dividends? Answer: the
insurer may guarantee dividends
8. Statements in an insurance application that are believed to be true are called:
Answer: representations
1/5
, 9. Which of the following would be considered a flexible premium policy? Answer:
universal life
10. The premium payment mode is best described as the: Answer: frequency of
premium payments
11. Which feature of Equity Indexed Whole Life is NOT fixed? Answer: cash
value growth
12. What type of permanent insurance allows premiums to be completely paid in a
set period? Answer: limited payment life
13. A settlement option that pays a fixed amount until proceeds run out is:
Answer: fixed-amount installments
14. An insurance agent represents the: Answer: insurer
15. A fixed annuity does all of the following EXCEPT: Answer: provides an
interest rate that is the lesser of the guaranteed or current rate
16. What do employees covered under group life insurance receive? Answer:
certificate of insurance
17. The “pay-in” phase of an annuity is known as the: Answer: accumulation
period
18. Which law forms the basis of statistical loss prediction? Answer: law of large
numbers
2/5
