Texas Life and Health Insurance Exam
Questions and Correct Answers
(Already Passed)
A retirement plan that sets aside part of the company's net income for distributions to
qualified employees is called a: - Answer-profit-sharing plan
Generally, how long is a benefit period for a Major Medical Expense Plan? - Answer-
One year
Which of the following benefits is NOT required under a group health plan for drug and
alcohol treatment? - Answer-Transportation to and from a treatment facility
A policy of adhesion can only be modified by whom? - Answer-The insurance company
Variable whole Life Insurance can be described as - Answer-both an insurance and
securities product
An insurance agent has a fiduciary responsibility to all of the following except - Answer-
other agents
T purchased a $100,000 single premium, Straight Life annuity 5 years ago. He has
received monthly payments since the inception of the annuity. If T dies, the insurance
company - Answer-does NOT have to make any further payments
N is a 40-year old applicant who would like to retire at age 70. He is looking to buy a life
insurance policy with level premiums, permanent protection, and be paid-up at
retirement. Which of these should N purchase? - Answer-30 Pay Life
What does a Face Amount Plus Cash Value Policy supposed to pay at the insured's
death? - Answer-Face amount plus the policy's cash value
During a sales presentation for a participating life insurance policy, an agent MUST -
Answer-make a prospect understand that dividends are NOT guaranteed
Which of these characteristics is consistent with a Straight Life Policy? - Answer-
Premiums are payable for as long as there is insurance coverage in force
, Which of the following are Equity Indexed annuities typically invested in? - Answer-S&P
500
Which of the following does Social Security NOT provide benefits for? - Answer-
Dismemberment
An example of false advertising would be - Answer-An insurer exaggerating its
dividends in a magazine advertisement
A 45 year-old woman won $100,000 in a scratch-off lottery ticket. She purchased an
annuity that will pay her $1500 per month beginning at age 60. Which of these annuities
did this woman purchase? - Answer-Deferred Fixed Annuity
Which of the following types of organizations are prepaid group health plans, where
members pay in advance for the services of participating physicians and hospitals that
have agreements? - Answer-HMO
Which action will a life insurance company most likely take if an insured dies and it is
discovered that the insured's age was misstated on the application? - Answer-Pay an
amount the premiums would have purchased at the insured's actual age
Q is looking to buy a life insurance policy that will provide the greatest amount of
protection for a temporary time period. Which of these policies should Q purchase? -
Answer-Term Life
An IRA owner can start making withdrawals and NOT be subjected to a tax penalty
beginning at what age? - Answer-59 1/2
An applicant MUST receive an Outline of Coverage when an application is taken for
a(n) - Answer-Medicare Supplement policy
Life insurance that covers an insured's whole life with level premiums paid over a limited
time is called: - Answer-Limited Pay Life
An individual has a Major Medical policy with a $5,000 deductible and an 80/20
Coinsurance clause. How much will the INSURED have to pay is a total of $15,000 in
covered medical expenses are incurred? - Answer-$7000
$5,000 + 20% = $7,000
How long can a cash surrender value payment be deferred by the insurance company
under the Nonforfeiture Law? - Answer-6 months
An Evidence of Coverage form may be issued by a Health Maintenance Organization
(HMO) after being approved by the - Answer-Commissioner
Questions and Correct Answers
(Already Passed)
A retirement plan that sets aside part of the company's net income for distributions to
qualified employees is called a: - Answer-profit-sharing plan
Generally, how long is a benefit period for a Major Medical Expense Plan? - Answer-
One year
Which of the following benefits is NOT required under a group health plan for drug and
alcohol treatment? - Answer-Transportation to and from a treatment facility
A policy of adhesion can only be modified by whom? - Answer-The insurance company
Variable whole Life Insurance can be described as - Answer-both an insurance and
securities product
An insurance agent has a fiduciary responsibility to all of the following except - Answer-
other agents
T purchased a $100,000 single premium, Straight Life annuity 5 years ago. He has
received monthly payments since the inception of the annuity. If T dies, the insurance
company - Answer-does NOT have to make any further payments
N is a 40-year old applicant who would like to retire at age 70. He is looking to buy a life
insurance policy with level premiums, permanent protection, and be paid-up at
retirement. Which of these should N purchase? - Answer-30 Pay Life
What does a Face Amount Plus Cash Value Policy supposed to pay at the insured's
death? - Answer-Face amount plus the policy's cash value
During a sales presentation for a participating life insurance policy, an agent MUST -
Answer-make a prospect understand that dividends are NOT guaranteed
Which of these characteristics is consistent with a Straight Life Policy? - Answer-
Premiums are payable for as long as there is insurance coverage in force
, Which of the following are Equity Indexed annuities typically invested in? - Answer-S&P
500
Which of the following does Social Security NOT provide benefits for? - Answer-
Dismemberment
An example of false advertising would be - Answer-An insurer exaggerating its
dividends in a magazine advertisement
A 45 year-old woman won $100,000 in a scratch-off lottery ticket. She purchased an
annuity that will pay her $1500 per month beginning at age 60. Which of these annuities
did this woman purchase? - Answer-Deferred Fixed Annuity
Which of the following types of organizations are prepaid group health plans, where
members pay in advance for the services of participating physicians and hospitals that
have agreements? - Answer-HMO
Which action will a life insurance company most likely take if an insured dies and it is
discovered that the insured's age was misstated on the application? - Answer-Pay an
amount the premiums would have purchased at the insured's actual age
Q is looking to buy a life insurance policy that will provide the greatest amount of
protection for a temporary time period. Which of these policies should Q purchase? -
Answer-Term Life
An IRA owner can start making withdrawals and NOT be subjected to a tax penalty
beginning at what age? - Answer-59 1/2
An applicant MUST receive an Outline of Coverage when an application is taken for
a(n) - Answer-Medicare Supplement policy
Life insurance that covers an insured's whole life with level premiums paid over a limited
time is called: - Answer-Limited Pay Life
An individual has a Major Medical policy with a $5,000 deductible and an 80/20
Coinsurance clause. How much will the INSURED have to pay is a total of $15,000 in
covered medical expenses are incurred? - Answer-$7000
$5,000 + 20% = $7,000
How long can a cash surrender value payment be deferred by the insurance company
under the Nonforfeiture Law? - Answer-6 months
An Evidence of Coverage form may be issued by a Health Maintenance Organization
(HMO) after being approved by the - Answer-Commissioner
