PRIMERICA LIFE INSURANCE Exam 2026: Complete Questions with Accurate Answers & Explanations | Guaranteed Pass | Latest Version

PRIMERICA LIFE INSURANCE Exam 2026: Complete Questions with Accurate Answers & Explanations | Guaranteed Pass | Latest Version 1. An insured purchased an insurance policy 5 years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insurer. From what type of insurer did the insured purchase the policy? a. mutual b. reciprocal c. nonprofit service organization d. stock - ANSWER A. mutual funds not paid out after paying claims and other operating costs are returned to the policy owners in the form of a dividend. if all funds are paid out, no dividends are paid 2. Following a career change, an insured is no longer required to perform many physical activities, so he has implemented a program where he walks and jogs for 45 minutes each morning. The insured has also eliminated most fatty foods from his diet. Which method of dealing with risk does this scenario describe? a. retention b. reduction c. transfer d. avoidance - ANSWER B. reduction the insured's change in lifestyle and habits would likely reduce the chances of health problems 3. In insurance, an offer is usually made when a. an applicant submits an application to the insurer b. the insurer approves the application and receives the initial premium c. the agent hands the policy to the policyholder d. an agent explains a policy to a potential applicant - ANSWER A. an applicant submits an application to the insurer in insurance, the offer is usually made by the applicant in the form of an application. acceptance takes place when an insurer's underwriter approves the application and issues a policy 4. the causes of loss insured against in an insurance policy are known as a. perils b. losses c. risks d. hazards - ANSWER A. perils perils are the causes of loss insured against in an insurance policy 5. Which option provides a single beneficiary with income for the rest of his/her life? a. joint life option b. single beneficiary option c. single life option d. one beneficiary option - ANSWER c. single life option- provides a single beneficiary with income for the rest of his/her life 6. A policyowner fails to pay the premium due on his whole life policy after the grace period passes, but the policy remains in force. This is due to what provision? a. assignment b. automatic premium loans c. waiver of premium d. incontestability period - ANSWER b. automatic premium loans- commonly added to contracts with a cash value at no additional charge. This is a special type of loan that prevents the unintentional lapse of a policy due to nonpayment of the premium Bonnie wants to name her husband as the beneficiary of her life policy. She also wishes to retain all of the rights of the ownership Bonnie should have her husband named as the - ANSWER Revocable beneficiary-she can make changes to the contract, and she would be the policy owner while her husband would receive the death benefit 7. Kayla's husband died in a plane crash. She needs a new source of funding that will help put her child through daycare. Which of the following would be the best source? a. estate conservation b. life insurance proceeds c. state education waiver d. viatical settlement - ANSWER b. life insurance proceeds- day care is considered a need-based expense that can be paid by life insurance proceeds Which of the following are generally not considered when underwriting group insurance? a. the size of the group b. the group's medical history c. the nature of the group d. the group's past claim experience - ANSWER b. the group's medical history- because it's a group and not written on an individual basis medical questions are not necessary With a Straight Life policy, what happens if the insured lives to age 100? a. the policy matures and the face value is paid to the beneficiary b. the policy matures and the cash value is used to purchase a single premium policy c. the policy will stay in force until the insured's death d. the policy matures and the cash value is paid to the insured. - ANSWER d. the policy endows (matures) and the cash value, equal to the face amount, is paid to the insured The policyowner of an Adjustable Life policy can increase premium payments and a. have a lower non forfeiture option b. have a higher cash value interest rate c. have a higher face amount without proof of insurability d. have a limited pay policy - ANSWER d. have a limited pay policy- Adjustable life policy has the following privileges 1. increasing decreasing the premium 2. changing the premium-paying period 3. increasing or decreasing the face amount of coverage 4. changing the period of protection All other factors being equal, the least expensive first-year premium payment is found in a. level term b. annually renewable term c. increasing term d. decreasing term - ANSWER b. annually renewable term- is the purest form of term insurance. The death benefit remains level, but the premium increases each year with the insured's attained age. decreasing policies-the face amount decreases, the premium is constant level term and increasing term policies- the premium remains level for the term of the policy Who can make changes to the policy once it is in effect? a. the insured b. the policyowner c. the agent d. an executive officer of the insurer - ANSWER d. an executive officer of the insurer- any changes made to policy must be endorsed and attached to the policy over the signature of an authorized officer of that insurer. No other individual has the authority to make changes or waive policy provisions. Who has the legal title of the property in a trust? a. guardian b. trustee c. grantor d. beneficiary - ANSWER b. trustee The rider that allows the company to forgo collecting the premium if the insured is disabled is called a. waiver of premium b. guaranteed insurability c. waiver of cost of insurance d. payor benefit - ANSWER a. waiver of premium-rider allows waives the premium if the premium if the insured owner has been totally disabled for a predetermined period. The payor benefit provides for an owner other than the insured and the waiver of cost of insurance is found in Universal Life An agent is acting ethically in all the of following situations EXCEPT a. working within the conditions of his/her contract b. representing the insurer, not the insured c. keeping customers' best interests in mind d. always representing the insured - ANSWER d. always representing the insured-they are deemed to represent the insurer, not the insured The provision which states that both the policy and a copy of the application form the contract between the policyowner and the insurer is called the a. total contract b. aleatory contract c. complete contract d. entire contract - ANSWER d. entire contract-the policy with the attached application which is a mandatory provision in life insurance. This provision limits the use of evidence other than the contract and the application in a test of the contract's validity. If a consumer requests additional information concerning an Investigative Consumer Report, how long does the insurer or reporting agency have to comply? a. 5 days b. 7 days c. 10 days d. 3 days - ANSWER a. 5 days An insurer has filed a new rate with the Commissioner, and is waiting for a reply. The Commissioner hasn't responded yet. After how many days can the insurer apply the new rate? a. 5 days b. 10 days c. 60 days d. 45 days - ANSWER b. 10 days- if the rate filed, but is not disapproved within 10 days, the higher rate may be applied. If Tom's policy allows him to make periodic additions to the face amount at standard rates, without proving instability, his policy includes a a. Conversion option b. Non forfeiture option c. Guaranteed insurability option d. Guaranteed renewable option - ANSWER c. Guaranteed insurability option- allows the policyowner to purchase specific amounts of additional insurance at specific dates or events, without providing continued insurability. Rates for the additions are based upon attained age. The paid-up addition option uses the dividend a. to accumulate additional savings for retirement b. to purchase a smaller amount of the same type of insurance as the original policy c. to purchase a one-year term insurance in the amount of the cash value d. to reduce the next year's premium - ANSWER b. to purchase a smaller amount of the same type of insurance as the original policy-additional permanent policy An insured purchases a policy in 2000 and dies and 2005. The insurance company discovers at the time that the insured concealed information during the application process. What can they do? a. Sue for the right to not pay the death benefit b. Pay the death benefit c. Refuse to pay the death benefit because of the fraud d. Pay a decreased death benefit - ANSWER b. Pay the death benefit- the incontestability clause prevents an insurer from denying a claim due to statements in an application after the policy has been in force for 2 years, even on the basis of a material misstatement of facts or concealment of a material fact. The following are legitimate uses of insurance in a business setting EXCEPT a. Funding business continuation agreements b. Funding against general company financial loss c. compensating executives d. funding against financial loss caused by the death of a key employee - ANSWER b. Funding against general company financial loss-both life and health insurance can be used for a variety of purposes in a business setting, including the funding of business continuation agreements, compensating executives, and protecting the firm against financial loss resulting from the death or disability of key empolyees what documentation grants express authority to an agent? a. agents contract with the principal b. agents insurance license c. fiduciary contract d. state provisions - ANSWER A. agents contract with the principal the principal grants authority to an agent through the agent's contract which of the following best describes an insurance company that has been formed under the laws of this state? a. domestic b. sovereign c. alien d. foreign - ANSWER A. domestic a company is domestic when doing business within the state in which it is incorporated