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MASSACHUSETTS LIFE AND HEALTH INSURANCE
EXAM ACTUAL PREP QUESTIONS AND WELL
REVISED ANSWERS - LATEST AND COMPLETE
UPDATE WITH VERIFIED SOLUTIONS – ASSURES
PASS
Comprehensive Practice Test (Questions 1–200)
Description
This exam is designed to fully prepare candidates for the Massachusetts Life and Health
Insurance Producer Licensing Examination. It covers state-specific insurance laws and
regulations, life insurance concepts, annuities, health insurance policies, underwriting, taxation,
ethics, and consumer protection. Questions reflect both conceptual understanding and real-
world application, closely mirroring the difficulty and scope of the actual exam.
1. What is the primary purpose of life insurance?
A. To provide retirement income
B. To protect against liability
C. To create an estate
D. To provide financial protection against premature death
Answer: D
Rationale: Life insurance replaces lost income or financial support upon the
insured’s death.
2. Which type of life insurance provides coverage for a specified period?
A. Whole life
B. Universal life
C. Term life
D. Variable life
Answer: C
Rationale: Term life covers the insured for a stated term, such as 10 or 20 years.
3. In Massachusetts, who regulates insurance producers?
A. National Association of Insurance Commissioners
B. Massachusetts Division of Insurance
C. Secretary of State
D. Department of Revenue
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Answer: B
Rationale: The Massachusetts Division of Insurance oversees licensing and
regulation.
4. Which policy feature allows the owner to borrow against cash value?
A. Grace period
B. Accelerated benefit rider
C. Policy loan provision
D. Incontestability clause
Answer: C
Rationale: Permanent life policies allow loans using cash value as collateral.
5. What is the incontestability period in Massachusetts?
A. 6 months
B. 1 year
C. 2 years
D. 5 years
Answer: C
Rationale: After two years, insurers cannot contest statements except for fraud.
6. Who must have an insurable interest at policy issue?
A. Beneficiary
B. Policyowner
C. Agent
D. Insurer
Answer: B
Rationale: The policyowner must face a financial loss if the insured dies.
7. Which dividend option purchases additional paid-up insurance?
A. Cash
B. Reduction of premium
C. Accumulation at interest
D. Paid-up additions
Answer: D
Rationale: Paid-up additions increase death benefit and cash value.
8. What does the grace period protect against?
A. Misrepresentation
B. Policy lapse due to late premium
C. Underwriting errors
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D. Fraud
Answer: B
Rationale: Grace periods allow continued coverage despite late payment.
9. Which rider allows early access to death benefits?
A. Waiver of premium
B. Accidental death
C. Accelerated benefit
D. Child rider
Answer: C
Rationale: Accelerated benefits pay a portion of death benefit early.
10. Which policy guarantees cash value growth?
A. Variable life
B. Term life
C. Whole life
D. Universal variable life
Answer: C
Rationale: Whole life has guaranteed cash values and premiums.
11. What is considered a living benefit?
A. Death benefit
B. Policy dividend
C. Accelerated death benefit
D. Settlement option
Answer: C
Rationale: Living benefits are paid while the insured is alive.
12. Which settlement option pays income for life?
A. Fixed amount
B. Fixed period
C. Life income
D. Lump sum
Answer: C
Rationale: Life income continues payments until the beneficiary dies.
13. Who owns group life insurance contracts?
A. Employee
B. Employer
C. Beneficiary
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D. Insurer
Answer: B
Rationale: Employers own group policies and provide certificates to employees.
14. What happens if a beneficiary predeceases the insured?
A. Policy is void
B. Proceeds go to insurer
C. Proceeds go to contingent beneficiary
D. Policy lapses
Answer: C
Rationale: Contingent beneficiaries receive proceeds if primary is deceased.
15. Which clause protects beneficiaries from creditors?
A. Entire contract
B. Spendthrift
C. Incontestability
D. Misstatement of age
Answer: B
Rationale: Spendthrift clauses prevent seizure of proceeds.
16. What is the main purpose of underwriting?
A. Determine premium mode
B. Assess risk
C. Issue licenses
D. Pay claims
Answer: B
Rationale: Underwriting evaluates applicant risk.
17. Which type of life policy allows flexible premiums?
A. Whole life
B. Term life
C. Universal life
D. Endowment
Answer: C
Rationale: Universal life allows adjustable premiums and death benefits.
18. Which statement about term insurance is true?
A. It builds cash value
B. Premiums remain level forever
C. It is temporary coverage
MASSACHUSETTS LIFE AND HEALTH INSURANCE
EXAM ACTUAL PREP QUESTIONS AND WELL
REVISED ANSWERS - LATEST AND COMPLETE
UPDATE WITH VERIFIED SOLUTIONS – ASSURES
PASS
Comprehensive Practice Test (Questions 1–200)
Description
This exam is designed to fully prepare candidates for the Massachusetts Life and Health
Insurance Producer Licensing Examination. It covers state-specific insurance laws and
regulations, life insurance concepts, annuities, health insurance policies, underwriting, taxation,
ethics, and consumer protection. Questions reflect both conceptual understanding and real-
world application, closely mirroring the difficulty and scope of the actual exam.
1. What is the primary purpose of life insurance?
A. To provide retirement income
B. To protect against liability
C. To create an estate
D. To provide financial protection against premature death
Answer: D
Rationale: Life insurance replaces lost income or financial support upon the
insured’s death.
2. Which type of life insurance provides coverage for a specified period?
A. Whole life
B. Universal life
C. Term life
D. Variable life
Answer: C
Rationale: Term life covers the insured for a stated term, such as 10 or 20 years.
3. In Massachusetts, who regulates insurance producers?
A. National Association of Insurance Commissioners
B. Massachusetts Division of Insurance
C. Secretary of State
D. Department of Revenue
,2|Page
Answer: B
Rationale: The Massachusetts Division of Insurance oversees licensing and
regulation.
4. Which policy feature allows the owner to borrow against cash value?
A. Grace period
B. Accelerated benefit rider
C. Policy loan provision
D. Incontestability clause
Answer: C
Rationale: Permanent life policies allow loans using cash value as collateral.
5. What is the incontestability period in Massachusetts?
A. 6 months
B. 1 year
C. 2 years
D. 5 years
Answer: C
Rationale: After two years, insurers cannot contest statements except for fraud.
6. Who must have an insurable interest at policy issue?
A. Beneficiary
B. Policyowner
C. Agent
D. Insurer
Answer: B
Rationale: The policyowner must face a financial loss if the insured dies.
7. Which dividend option purchases additional paid-up insurance?
A. Cash
B. Reduction of premium
C. Accumulation at interest
D. Paid-up additions
Answer: D
Rationale: Paid-up additions increase death benefit and cash value.
8. What does the grace period protect against?
A. Misrepresentation
B. Policy lapse due to late premium
C. Underwriting errors
,3|Page
D. Fraud
Answer: B
Rationale: Grace periods allow continued coverage despite late payment.
9. Which rider allows early access to death benefits?
A. Waiver of premium
B. Accidental death
C. Accelerated benefit
D. Child rider
Answer: C
Rationale: Accelerated benefits pay a portion of death benefit early.
10. Which policy guarantees cash value growth?
A. Variable life
B. Term life
C. Whole life
D. Universal variable life
Answer: C
Rationale: Whole life has guaranteed cash values and premiums.
11. What is considered a living benefit?
A. Death benefit
B. Policy dividend
C. Accelerated death benefit
D. Settlement option
Answer: C
Rationale: Living benefits are paid while the insured is alive.
12. Which settlement option pays income for life?
A. Fixed amount
B. Fixed period
C. Life income
D. Lump sum
Answer: C
Rationale: Life income continues payments until the beneficiary dies.
13. Who owns group life insurance contracts?
A. Employee
B. Employer
C. Beneficiary
, 4|Page
D. Insurer
Answer: B
Rationale: Employers own group policies and provide certificates to employees.
14. What happens if a beneficiary predeceases the insured?
A. Policy is void
B. Proceeds go to insurer
C. Proceeds go to contingent beneficiary
D. Policy lapses
Answer: C
Rationale: Contingent beneficiaries receive proceeds if primary is deceased.
15. Which clause protects beneficiaries from creditors?
A. Entire contract
B. Spendthrift
C. Incontestability
D. Misstatement of age
Answer: B
Rationale: Spendthrift clauses prevent seizure of proceeds.
16. What is the main purpose of underwriting?
A. Determine premium mode
B. Assess risk
C. Issue licenses
D. Pay claims
Answer: B
Rationale: Underwriting evaluates applicant risk.
17. Which type of life policy allows flexible premiums?
A. Whole life
B. Term life
C. Universal life
D. Endowment
Answer: C
Rationale: Universal life allows adjustable premiums and death benefits.
18. Which statement about term insurance is true?
A. It builds cash value
B. Premiums remain level forever
C. It is temporary coverage
