WV STATE LIFE INSURANCE PRACTICE
PAPER 2026 FULL QUESTIONS AND
ANSWERS GRADED A+
◉Which of the following requires insurers to disclose when an
applicant's consumer or credit history is being investigated?
Answer: 1970-Fair Credit Reporting Act
◉Q purchases a $500,000 life insurance policy and pays $900 in
premiums over the first six months. Q dies suddenly and the
beneficiary is paid $500,000. This exchange of unequal values
reflects which of the following insurance contract features? Answer:
Aleatory
◉The stated amount or percent of liquid assets that an insurer must
have on hand that will satisfy future obligations to its policyholders
is called: Answer: Reserves
◉All of the following are considered to be typical characteristics
describing the nature of an insurance contract, EXCEPT: Answer:
Bilateral
◉What year was the McCarran-Ferguson Act enacted? Answer:
1945
,◉Which of the following consists of an offer, acceptance, and
consideration? Answer: Contract
◉Who elects the governing body of a mutual insurance company?
Answer: Policyholders
◉Insurance policies are considered aleatory contracts because:
Answer: Performance is conditioned upon a future occurrence
◉Who makes the legally enforceable promises in a unilateral
contract? Answer: Insurance company
◉Insurance contracts are known as _____ because certain future
conditions or acts must occur before any claims can be paid.
Answer: Conditional
◉A life insurance arrangement which circumvents insurable interest
statutes is called: Answer: Investor-Originated Life Insurance
◉In an insurance contract, the insurer is the only party who makes a
legally enforceable promise. What kind of contract is this? Answer:
Unilateral
, ◉When third-party ownership is involved, applicants who also
happen to be the stated primary beneficiary are required to have:
Answer: Insurable interest in the proposed insured
◉Which of these arrangements allows one to bypass insurable
interest laws? Answer: Investor-Originated Life Insurance
◉When must insurable interest exist for a life insurance contract to
be valid? Answer: Inception of the contract
◉If a contract of adhesion contains complicated language, to whom
would the interpretation be in favor of? Answer: Insured
◉Which of these is an element of a Variable Life policy? Answer: A
fixed, level premium
◉A father who dies within 3 years after purchasing a life insurance
policy on his infant daughter can have the policy premiums waived
under which provision? Answer: Payor provision
◉Who benefits in Investor-Originated Life Insurance (IOLI) when
the insured dies? Answer: Policyowner
PAPER 2026 FULL QUESTIONS AND
ANSWERS GRADED A+
◉Which of the following requires insurers to disclose when an
applicant's consumer or credit history is being investigated?
Answer: 1970-Fair Credit Reporting Act
◉Q purchases a $500,000 life insurance policy and pays $900 in
premiums over the first six months. Q dies suddenly and the
beneficiary is paid $500,000. This exchange of unequal values
reflects which of the following insurance contract features? Answer:
Aleatory
◉The stated amount or percent of liquid assets that an insurer must
have on hand that will satisfy future obligations to its policyholders
is called: Answer: Reserves
◉All of the following are considered to be typical characteristics
describing the nature of an insurance contract, EXCEPT: Answer:
Bilateral
◉What year was the McCarran-Ferguson Act enacted? Answer:
1945
,◉Which of the following consists of an offer, acceptance, and
consideration? Answer: Contract
◉Who elects the governing body of a mutual insurance company?
Answer: Policyholders
◉Insurance policies are considered aleatory contracts because:
Answer: Performance is conditioned upon a future occurrence
◉Who makes the legally enforceable promises in a unilateral
contract? Answer: Insurance company
◉Insurance contracts are known as _____ because certain future
conditions or acts must occur before any claims can be paid.
Answer: Conditional
◉A life insurance arrangement which circumvents insurable interest
statutes is called: Answer: Investor-Originated Life Insurance
◉In an insurance contract, the insurer is the only party who makes a
legally enforceable promise. What kind of contract is this? Answer:
Unilateral
, ◉When third-party ownership is involved, applicants who also
happen to be the stated primary beneficiary are required to have:
Answer: Insurable interest in the proposed insured
◉Which of these arrangements allows one to bypass insurable
interest laws? Answer: Investor-Originated Life Insurance
◉When must insurable interest exist for a life insurance contract to
be valid? Answer: Inception of the contract
◉If a contract of adhesion contains complicated language, to whom
would the interpretation be in favor of? Answer: Insured
◉Which of these is an element of a Variable Life policy? Answer: A
fixed, level premium
◉A father who dies within 3 years after purchasing a life insurance
policy on his infant daughter can have the policy premiums waived
under which provision? Answer: Payor provision
◉Who benefits in Investor-Originated Life Insurance (IOLI) when
the insured dies? Answer: Policyowner
