XCEL Testing Solutions California Pre-Licensing
Education: Life, Accident, and Health Insurance
Exam Preparation Comprehensive Review with
450 + Practice Questions and Verified Correct
Answers
An annuitant would like to determine the amount of an annuity distribution that is
exempt from taxation. What is used to calculate this? - Answer - exclusion ratio
Cindy buys a 10-year certain annuity with an installment refund. After receiving
monthly payments for 5 years, Cindy dies. How many remaining payments will the
insurer make to her beneficiary? - Answer - 60 payments
A savings vehicle designed to first accumulate funds and then systematically
liquidates the funds is called - Answer - Deferred annuity
Which of the following is not a feature of equity-indexed annuities? - Answer -
Offers maximum interest rate that increased annually
An annuity which is backed by a life insurer's separate account is called a(n) -
Answer - variable annuity
An annuitant would like to determine the current value of her annuity. To do this,
she multiplies the number of "accumulation units" she owns times the unit value of
the "separate account". What kind of annuity BEST matches this description? -
Answer - Variable annuity
The systematic liquidation of a sum of money is provided by a(n) - Answer -
annuity
,Which of the following statements regarding a life insurance policy dividend is
TRUE? - Answer - It is the distribution of excess of funds accumulated by the
insurer on participating policies
An insurer enters into a contract with a third party to insure itself against losses
from insurance policies it issues. What is this agreement called? - Answer -
Reinsurance
AAA insurance Company has transferred a portion of its loss exposure to BBB
Insurance company. In this reinsurance transaction, what is AAA Insurance
Company called? - Answer - Primary Insurer
When a mutual insurer becomes stock company, the process is called? - Answer -
Demutualization
Which of the following is NOT a benefit of insurance? - Answer - Losses due to
fraud are eliminated
A participating company is also referred to as which type of insurer? - Answer -
Mutual insurer
Manuel is considered to be a disabled person as defined by the Americans with
Disabilities Act (ADA). As such, he is unable to perform any of the following life
activities EXCEPT - Answer - Driving
What are the residual disability income insurance payments based on? - Answer -
The amount of the insured's income is reduced by the disability
,Which of these statements is NOT true concerning recurrent disabilities? - Answer
- The insurer continues coverage after a new elimination period
Allen has a disability income policy with a $2,500 monthly benefit and a 30-day
elimination period. He is unable to work 90 days following an automobile
accident. What will the policy pay? - Answer - 5,000
Which of the following is NOT a provision in a disability income policy? - Answer
- Deductible and coinsurance provision
The elimination period in disability income policy serves the same purpose as -
Answer - A deductible
Dyan is considered partially disabled by her insurance company. Which of the
following BEST describes her situation? - Answer - She is working part-time and
receiving lost income under her long-term disability benefit
Who is financially liable for the payment of covered claims in a fully insured
group health plan? - Answer - Insurer
In regards to a group health insurance plan, which statement is CORRECT? -
Answer - A non-contributory group health plan must cover all eligible memebers
When a claimant has coverage under more than one health plan, which group
medical plan provision applies? - Answer - Coordination of benefits
Coverage is limited for vision and dental insurance in all of the following ways
EXCEPT - Answer - Specific dollar amount for examinations
, An eligible individual who would like to obtain group health insurance without
providing evidence of insurability must - Answer - Enroll within a specified
eligibility period
Buy-sell plans are typically funded by which two types of insurance? - Answer -
Life insurance and disability insurance
Which of the following is NOT typically covered under vision care insurance? -
Answer - Eye Surgery
Under the Payment of Claims provision, when are benefits typically payable after
proof of loss is received? - Answer - immediately
Under a health insurance policy, the provision that states the kind of benefits
provided and the circumstances under which they will be paid is called the? -
Answer - insuring clause
The insurer has the option of terminating a health insurance policy on a date stated
in the contract. What type of policy is this? - Answer - Optionally renewable
Which type of health insurance policy cannot be canceled by the insurer nor
increase the premiums? - Answer - Noncancellable
The conditions, times, and circumstances under which an insured is NOT covered
by a health policy are called? - Answer - Exclusions
The misstatement of age provision in a health policy states that if an insured gives
the wrong age at the time of application, what action can the insurance company
take? - Answer - Benefits can be adjusted
Education: Life, Accident, and Health Insurance
Exam Preparation Comprehensive Review with
450 + Practice Questions and Verified Correct
Answers
An annuitant would like to determine the amount of an annuity distribution that is
exempt from taxation. What is used to calculate this? - Answer - exclusion ratio
Cindy buys a 10-year certain annuity with an installment refund. After receiving
monthly payments for 5 years, Cindy dies. How many remaining payments will the
insurer make to her beneficiary? - Answer - 60 payments
A savings vehicle designed to first accumulate funds and then systematically
liquidates the funds is called - Answer - Deferred annuity
Which of the following is not a feature of equity-indexed annuities? - Answer -
Offers maximum interest rate that increased annually
An annuity which is backed by a life insurer's separate account is called a(n) -
Answer - variable annuity
An annuitant would like to determine the current value of her annuity. To do this,
she multiplies the number of "accumulation units" she owns times the unit value of
the "separate account". What kind of annuity BEST matches this description? -
Answer - Variable annuity
The systematic liquidation of a sum of money is provided by a(n) - Answer -
annuity
,Which of the following statements regarding a life insurance policy dividend is
TRUE? - Answer - It is the distribution of excess of funds accumulated by the
insurer on participating policies
An insurer enters into a contract with a third party to insure itself against losses
from insurance policies it issues. What is this agreement called? - Answer -
Reinsurance
AAA insurance Company has transferred a portion of its loss exposure to BBB
Insurance company. In this reinsurance transaction, what is AAA Insurance
Company called? - Answer - Primary Insurer
When a mutual insurer becomes stock company, the process is called? - Answer -
Demutualization
Which of the following is NOT a benefit of insurance? - Answer - Losses due to
fraud are eliminated
A participating company is also referred to as which type of insurer? - Answer -
Mutual insurer
Manuel is considered to be a disabled person as defined by the Americans with
Disabilities Act (ADA). As such, he is unable to perform any of the following life
activities EXCEPT - Answer - Driving
What are the residual disability income insurance payments based on? - Answer -
The amount of the insured's income is reduced by the disability
,Which of these statements is NOT true concerning recurrent disabilities? - Answer
- The insurer continues coverage after a new elimination period
Allen has a disability income policy with a $2,500 monthly benefit and a 30-day
elimination period. He is unable to work 90 days following an automobile
accident. What will the policy pay? - Answer - 5,000
Which of the following is NOT a provision in a disability income policy? - Answer
- Deductible and coinsurance provision
The elimination period in disability income policy serves the same purpose as -
Answer - A deductible
Dyan is considered partially disabled by her insurance company. Which of the
following BEST describes her situation? - Answer - She is working part-time and
receiving lost income under her long-term disability benefit
Who is financially liable for the payment of covered claims in a fully insured
group health plan? - Answer - Insurer
In regards to a group health insurance plan, which statement is CORRECT? -
Answer - A non-contributory group health plan must cover all eligible memebers
When a claimant has coverage under more than one health plan, which group
medical plan provision applies? - Answer - Coordination of benefits
Coverage is limited for vision and dental insurance in all of the following ways
EXCEPT - Answer - Specific dollar amount for examinations
, An eligible individual who would like to obtain group health insurance without
providing evidence of insurability must - Answer - Enroll within a specified
eligibility period
Buy-sell plans are typically funded by which two types of insurance? - Answer -
Life insurance and disability insurance
Which of the following is NOT typically covered under vision care insurance? -
Answer - Eye Surgery
Under the Payment of Claims provision, when are benefits typically payable after
proof of loss is received? - Answer - immediately
Under a health insurance policy, the provision that states the kind of benefits
provided and the circumstances under which they will be paid is called the? -
Answer - insuring clause
The insurer has the option of terminating a health insurance policy on a date stated
in the contract. What type of policy is this? - Answer - Optionally renewable
Which type of health insurance policy cannot be canceled by the insurer nor
increase the premiums? - Answer - Noncancellable
The conditions, times, and circumstances under which an insured is NOT covered
by a health policy are called? - Answer - Exclusions
The misstatement of age provision in a health policy states that if an insured gives
the wrong age at the time of application, what action can the insurance company
take? - Answer - Benefits can be adjusted
