Maryland Life Insurance Producer Exam
questions and Correct Answers (Verified
Answers) Plus Rationales 2026 Q&A | Instant
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1. What is the primary purpose of life insurance?
A. To accumulate savings
B. To provide retirement income
C. To create an immediate estate for beneficiaries
D. To avoid paying taxes
Life insurance is designed to provide financial protection by
creating an immediate estate upon the insured’s death.
2. Who is the policyowner in a life insurance contract?
A. The insured
B. The beneficiary
C. The insurance company
D. The person who owns and controls the policy
The policyowner has all contractual rights, including naming
beneficiaries and assigning the policy.
3. Which element is NOT required for a valid life insurance contract?
A. Offer and acceptance
B. Consideration
C. Competent parties
D. Equal bargaining power
Insurance contracts are contracts of adhesion and do not require
equal bargaining power.
,4. What type of life insurance provides coverage for a specified
period of time?
A. Whole life
B. Universal life
C. Term life
D. Variable life
Term life insurance provides pure death benefit protection for a
stated term.
5. Which policy feature allows the policyowner to change
beneficiaries?
A. Irrevocable designation
B. Revocable designation
C. Assignment
D. Endorsement
A revocable beneficiary can be changed at any time by the
policyowner.
6. What happens if a premium is not paid by the end of the grace
period?
A. Policy benefits are reduced
B. Policy is converted
C. Policy lapses
D. Policy is suspended
Failure to pay premiums within the grace period results in policy
lapse.
7. Which type of beneficiary designation pays benefits to surviving
beneficiaries by class?
A. Primary
B. Contingent
C. Per capita
, D. Per stirpes
Per capita distributes benefits equally among surviving
beneficiaries.
8. What is insurable interest based on in life insurance?
A. Consent of the insured
B. Financial or emotional loss at death
C. Beneficiary designation
D. Policy amount
Insurable interest exists when the policyowner would suffer a loss
upon the insured’s death.
9. Which rider provides coverage for children under a parent’s
policy?
A. Accidental death rider
B. Waiver of premium rider
C. Children’s term rider
D. Guaranteed insurability rider
Children’s term riders provide level term coverage for eligible
children.
10. Which life insurance policy builds cash value and provides
lifetime protection?
A. Term life
B. Whole life
C. Credit life
D. Group life
Whole life insurance offers permanent coverage with guaranteed
cash values.
11. What is the incontestability clause designed to do?
A. Protect the insurer from fraud
B. Protect the insured from cancellation
questions and Correct Answers (Verified
Answers) Plus Rationales 2026 Q&A | Instant
Download Pdf
1. What is the primary purpose of life insurance?
A. To accumulate savings
B. To provide retirement income
C. To create an immediate estate for beneficiaries
D. To avoid paying taxes
Life insurance is designed to provide financial protection by
creating an immediate estate upon the insured’s death.
2. Who is the policyowner in a life insurance contract?
A. The insured
B. The beneficiary
C. The insurance company
D. The person who owns and controls the policy
The policyowner has all contractual rights, including naming
beneficiaries and assigning the policy.
3. Which element is NOT required for a valid life insurance contract?
A. Offer and acceptance
B. Consideration
C. Competent parties
D. Equal bargaining power
Insurance contracts are contracts of adhesion and do not require
equal bargaining power.
,4. What type of life insurance provides coverage for a specified
period of time?
A. Whole life
B. Universal life
C. Term life
D. Variable life
Term life insurance provides pure death benefit protection for a
stated term.
5. Which policy feature allows the policyowner to change
beneficiaries?
A. Irrevocable designation
B. Revocable designation
C. Assignment
D. Endorsement
A revocable beneficiary can be changed at any time by the
policyowner.
6. What happens if a premium is not paid by the end of the grace
period?
A. Policy benefits are reduced
B. Policy is converted
C. Policy lapses
D. Policy is suspended
Failure to pay premiums within the grace period results in policy
lapse.
7. Which type of beneficiary designation pays benefits to surviving
beneficiaries by class?
A. Primary
B. Contingent
C. Per capita
, D. Per stirpes
Per capita distributes benefits equally among surviving
beneficiaries.
8. What is insurable interest based on in life insurance?
A. Consent of the insured
B. Financial or emotional loss at death
C. Beneficiary designation
D. Policy amount
Insurable interest exists when the policyowner would suffer a loss
upon the insured’s death.
9. Which rider provides coverage for children under a parent’s
policy?
A. Accidental death rider
B. Waiver of premium rider
C. Children’s term rider
D. Guaranteed insurability rider
Children’s term riders provide level term coverage for eligible
children.
10. Which life insurance policy builds cash value and provides
lifetime protection?
A. Term life
B. Whole life
C. Credit life
D. Group life
Whole life insurance offers permanent coverage with guaranteed
cash values.
11. What is the incontestability clause designed to do?
A. Protect the insurer from fraud
B. Protect the insured from cancellation
