NEVADA LIFE AND HEALTH INSURANCE EXAM
2026 INSURANCE PRINCIPLES AND
REGULATIONS ASSESSMENT STUDY GUIDE
COMPLETE QUESTIONS AND ANSWERS
◉ Option A (Level Death Benefit option). Answer: death benefit
remains level while cash value gradually increases, lowing the "pure
insurance" with insurer in later years
- death benefit increases near the end in order to maintain gap
between cash value and death benefit in life insurance policy
◉ Option B (Increasing Death Benefit option). Answer: death benefit
includes annual increase in cash value so that death benefit
gradually increases each year by amount that cash value increases
- pure insurance remains level for life
◉ variable whole life. Answer: level, fixed premium, investment-
based product; cash value of policy is not guaranteed and fluctuates
with performance of the portfolio in which premiums have been
invested by insurer
,◉ variable universal life. Answer: combination of universal life and
variable life; provides policy owner with flexible premiums and
adjustable death benefit, policyowner decides where cash value will
be invested (not guaranteed)
◉ interest-sensitive whole life. Answer: whole life policy that
provides a guaranteed death benefit to age 100 and for a minimum
guaranteed rate of interest
◉ indexed whole life. Answer: cash value is dependent upon the
performance of the equity index although there is a guaranteed
minimum interest rate
◉ joint life. Answer: single policy that is designed to insure two or
more lives; premium is less than for same type for individuals
◉ survivorship life (second to die). Answer: same as joint life except
pays on the last death rather than upon the first death; joint life
expectancy is extended, resulting in lower premium
◉ annuity. Answer: a contract that provides income for a specified
period of years, or for life; protects a person against outliving his or
her money
,◉ annuity owner. Answer: purchaser of annuity contract, not
necessarily the one who receives benefits; has all the rights
◉ annuitant. Answer: person who receives benefits or payments
from annuity, whose life expectancy is taken into consideration, and
for whom the annuity is written; must be a natural person
◉ annuity beneficiary. Answer: person who receives annuity assets
if the annuitant dies during the accumulation period, or to whom the
balance of annuity benefits is paid out
◉ accumulation period. Answer: period of time over which the
owner makes payments (premiums) into an annuity; payments earn
interest on tax-deferred basis
◉ annuitization period. Answer: the time during which the sum that
has been accumulated is converted into a stream of income
payments for the annuitant
◉ absolute assignment. Answer: involves transferring all rights of
ownership to another person or entity
◉ collateral assignment. Answer: involves a transfer of partial rights
to another person; usually done in order to secure a loan or some
other transaction
, ◉ premium mode. Answer: the manner or frequency that the
policyowner pays the premium
◉ reinstatement provision. Answer: allows a lapsed policy to be put
back in force; maximum time limit for reinstatement is usually 3
years after the policy has lapsed
- must provide evidence of insurability but will not change attained
age
◉ incontestability clause. Answer: prevents an insurer from denying
a claim due to statements in the application after the policy has been
in force for 2 years
◉ How many days must the insurer provide the policyowner that
policy is going to lapse?. Answer: 30 days written notice
◉ How long may an insurance company defer a policy loan request?.
Answer: up to 6 months
◉ automatic premium loan provision. Answer: special type of loan
that prevents the unintentional lapse of policy due to nonpayment of
premium; automatically generated by insurer when policyowner has
not paid premium by end of grace period
2026 INSURANCE PRINCIPLES AND
REGULATIONS ASSESSMENT STUDY GUIDE
COMPLETE QUESTIONS AND ANSWERS
◉ Option A (Level Death Benefit option). Answer: death benefit
remains level while cash value gradually increases, lowing the "pure
insurance" with insurer in later years
- death benefit increases near the end in order to maintain gap
between cash value and death benefit in life insurance policy
◉ Option B (Increasing Death Benefit option). Answer: death benefit
includes annual increase in cash value so that death benefit
gradually increases each year by amount that cash value increases
- pure insurance remains level for life
◉ variable whole life. Answer: level, fixed premium, investment-
based product; cash value of policy is not guaranteed and fluctuates
with performance of the portfolio in which premiums have been
invested by insurer
,◉ variable universal life. Answer: combination of universal life and
variable life; provides policy owner with flexible premiums and
adjustable death benefit, policyowner decides where cash value will
be invested (not guaranteed)
◉ interest-sensitive whole life. Answer: whole life policy that
provides a guaranteed death benefit to age 100 and for a minimum
guaranteed rate of interest
◉ indexed whole life. Answer: cash value is dependent upon the
performance of the equity index although there is a guaranteed
minimum interest rate
◉ joint life. Answer: single policy that is designed to insure two or
more lives; premium is less than for same type for individuals
◉ survivorship life (second to die). Answer: same as joint life except
pays on the last death rather than upon the first death; joint life
expectancy is extended, resulting in lower premium
◉ annuity. Answer: a contract that provides income for a specified
period of years, or for life; protects a person against outliving his or
her money
,◉ annuity owner. Answer: purchaser of annuity contract, not
necessarily the one who receives benefits; has all the rights
◉ annuitant. Answer: person who receives benefits or payments
from annuity, whose life expectancy is taken into consideration, and
for whom the annuity is written; must be a natural person
◉ annuity beneficiary. Answer: person who receives annuity assets
if the annuitant dies during the accumulation period, or to whom the
balance of annuity benefits is paid out
◉ accumulation period. Answer: period of time over which the
owner makes payments (premiums) into an annuity; payments earn
interest on tax-deferred basis
◉ annuitization period. Answer: the time during which the sum that
has been accumulated is converted into a stream of income
payments for the annuitant
◉ absolute assignment. Answer: involves transferring all rights of
ownership to another person or entity
◉ collateral assignment. Answer: involves a transfer of partial rights
to another person; usually done in order to secure a loan or some
other transaction
, ◉ premium mode. Answer: the manner or frequency that the
policyowner pays the premium
◉ reinstatement provision. Answer: allows a lapsed policy to be put
back in force; maximum time limit for reinstatement is usually 3
years after the policy has lapsed
- must provide evidence of insurability but will not change attained
age
◉ incontestability clause. Answer: prevents an insurer from denying
a claim due to statements in the application after the policy has been
in force for 2 years
◉ How many days must the insurer provide the policyowner that
policy is going to lapse?. Answer: 30 days written notice
◉ How long may an insurance company defer a policy loan request?.
Answer: up to 6 months
◉ automatic premium loan provision. Answer: special type of loan
that prevents the unintentional lapse of policy due to nonpayment of
premium; automatically generated by insurer when policyowner has
not paid premium by end of grace period
