NEW JERSEY LIFE INSURANCE EVALUATION EXAMS
2026/2027 QUESTIONS AND SOLUTIONS RATED A+
✔✔contract interest rate - ✔✔Usually 3 to 6%
✔✔current interest rate - ✔✔not guaranteed in the contract but may be higher because
of current market conditions
✔✔Option A (Level Death Benefit option) - ✔✔The death benefit remains level while the
cash value gradually increases, thereby lowering the pure insurance with the insurer in
the later years.
✔✔Option B (Increasing Death Benefit option) - ✔✔The death benefit includes the
annual increase in cash value so that the death benefit gradually increases each year
by the amount that the cash value increases.
✔✔Variable Life Insurance - ✔✔a level, fixed premium investment-based product.
Guaranteed minimum death benefit
Cash value is not guaranteed and fluctuates with the performance of the portfolio in
which premiums have been invested by insurer
✔✔Variable Universal Life Insurance - ✔✔Type of insurance that combines many
features of the whole life with the flexible premium of universal life and the investment
component of variable life, making it a securities version of the universal life insurance
✔✔Agents Selling Life Insurance - ✔✔Must:
1) be registered with FINRA
2) have a securities license
3) be licensed by the state to sell life insurance
✔✔Joint Life - ✔✔A single policy that is designed to insure two or more lives.
✔✔Joint Life Insurance Premium - ✔✔Based on the joint average that is between the
ages of the insureds
- the death benefit is paid upon the first death only
✔✔Survivorship Life Insurance - ✔✔insures both you and your spouse under one
policy, with the proceeds payable after the second death
✔✔Endowments - ✔✔to provide with a permanent fund or source of income
✔✔Annuity - ✔✔A contract that provides income for a specified period of years, or for
life.
, ✔✔Owner - ✔✔Has all rights to policy (usually annuitant); can be corporation or trust
✔✔Annuitant - ✔✔The person who receives benefits or payments from the annuity,
whose life expectancy is taken into consideration, and for whom the annuity is written.
✔✔Beneficiary - ✔✔the person who receives annuity assets if the annuitant dies during
the accumulation period
✔✔Accumulation Period - ✔✔Period of time over which the owner makes payments into
an annuity
✔✔Annuity Period - ✔✔The time during which the sum that has been accumulated
during the accumulation period is converted into a stream of income payments to the
annuitant.
✔✔Single Premium Annuity - ✔✔An Annuity purchased with one lump-sum payment,
generally with after tax dollars. You can buy either a Single Premium Immediate
Annuity, which allows you to "annuitize" right away, or you can buy a Single Premium
Deferred Annuity, where you annuitize sometime in the future, perhaps at retirement
age.
✔✔Periodic Premium Annuity - ✔✔premiums are paid in installments over a period of
time
✔✔Immediate Annuity - ✔✔Immediate: A Life Annuity contract where the
first pay-out is made within 12 months after it is
purchased. Can only be purchased with a single
premium/lump-sum payment.
✔✔Deferred Annuity - ✔✔A Life
Annuity contract where the first pay-out is made
12 months after it is purchased. Can be
purchased with either a single premium or with
continuous premium payments.
✔✔Fixed Annuity - ✔✔An annuity that offers fixed payments and guarantees a minimum
rate of interest to be credited to the purchase payment or payments.
✔✔Variable Annuity - ✔✔serves as a hedge against inflation, and is variable from the
standpoint that the annuitant may receive different rates of return on the funds that are
paid into the annuity.
✔✔Underlying Investment - ✔✔the payments that the annuitant makes into the variable
annuity are invested in the insurer's separate account, not their general account
2026/2027 QUESTIONS AND SOLUTIONS RATED A+
✔✔contract interest rate - ✔✔Usually 3 to 6%
✔✔current interest rate - ✔✔not guaranteed in the contract but may be higher because
of current market conditions
✔✔Option A (Level Death Benefit option) - ✔✔The death benefit remains level while the
cash value gradually increases, thereby lowering the pure insurance with the insurer in
the later years.
✔✔Option B (Increasing Death Benefit option) - ✔✔The death benefit includes the
annual increase in cash value so that the death benefit gradually increases each year
by the amount that the cash value increases.
✔✔Variable Life Insurance - ✔✔a level, fixed premium investment-based product.
Guaranteed minimum death benefit
Cash value is not guaranteed and fluctuates with the performance of the portfolio in
which premiums have been invested by insurer
✔✔Variable Universal Life Insurance - ✔✔Type of insurance that combines many
features of the whole life with the flexible premium of universal life and the investment
component of variable life, making it a securities version of the universal life insurance
✔✔Agents Selling Life Insurance - ✔✔Must:
1) be registered with FINRA
2) have a securities license
3) be licensed by the state to sell life insurance
✔✔Joint Life - ✔✔A single policy that is designed to insure two or more lives.
✔✔Joint Life Insurance Premium - ✔✔Based on the joint average that is between the
ages of the insureds
- the death benefit is paid upon the first death only
✔✔Survivorship Life Insurance - ✔✔insures both you and your spouse under one
policy, with the proceeds payable after the second death
✔✔Endowments - ✔✔to provide with a permanent fund or source of income
✔✔Annuity - ✔✔A contract that provides income for a specified period of years, or for
life.
, ✔✔Owner - ✔✔Has all rights to policy (usually annuitant); can be corporation or trust
✔✔Annuitant - ✔✔The person who receives benefits or payments from the annuity,
whose life expectancy is taken into consideration, and for whom the annuity is written.
✔✔Beneficiary - ✔✔the person who receives annuity assets if the annuitant dies during
the accumulation period
✔✔Accumulation Period - ✔✔Period of time over which the owner makes payments into
an annuity
✔✔Annuity Period - ✔✔The time during which the sum that has been accumulated
during the accumulation period is converted into a stream of income payments to the
annuitant.
✔✔Single Premium Annuity - ✔✔An Annuity purchased with one lump-sum payment,
generally with after tax dollars. You can buy either a Single Premium Immediate
Annuity, which allows you to "annuitize" right away, or you can buy a Single Premium
Deferred Annuity, where you annuitize sometime in the future, perhaps at retirement
age.
✔✔Periodic Premium Annuity - ✔✔premiums are paid in installments over a period of
time
✔✔Immediate Annuity - ✔✔Immediate: A Life Annuity contract where the
first pay-out is made within 12 months after it is
purchased. Can only be purchased with a single
premium/lump-sum payment.
✔✔Deferred Annuity - ✔✔A Life
Annuity contract where the first pay-out is made
12 months after it is purchased. Can be
purchased with either a single premium or with
continuous premium payments.
✔✔Fixed Annuity - ✔✔An annuity that offers fixed payments and guarantees a minimum
rate of interest to be credited to the purchase payment or payments.
✔✔Variable Annuity - ✔✔serves as a hedge against inflation, and is variable from the
standpoint that the annuitant may receive different rates of return on the funds that are
paid into the annuity.
✔✔Underlying Investment - ✔✔the payments that the annuitant makes into the variable
annuity are invested in the insurer's separate account, not their general account
