ARKANSAS LIFE INSURANCE EXAM 2026
COMPLETE PRACTICE QUESTIONS AND
CORRECT ANSWERS WITH DETAILED
EXPLANATIONS ARKANSAS LIFE
INSURANCE PRODUCER LICENSING EXAM
STUDY GUIDE GRADE A+ 2026 EDITION
Erica is 35 years old and owns an IRA. At what age can she begin to receive
distributions without a tax penalty? - CORRECT ANSWER -59 1/2
An interest-sensitive life insurance policy owner may be able to withdraw
the policy's cash value interest free. The provision that allows this is called -
CORRECT ANSWER -Partial surrender
A Renewable Term Life insurance policy can be renewed - CORRECT
ANSWER -At a pre-determined date or age, regardless of the insured's
health
Which does NOT correctly describe the purpose of Social Security? -
CORRECT ANSWER -Provides a source of income for a meaningful standard
of living during retirement
*SS enhances, but does not replace, a sound personal insurance plan
,Index whole life insurance contains a securities component that acts as a(n)
- CORRECT ANSWER -Hedge against inflation
Pat is insured with a life insurance policy and Karen is his primary
beneficiary. They are both involved in an automobile accident where Pat
dies instantly and Karen dies 5 days later. Which policy provision will
protect the rights of the contingent beneficiary to receive the policy
benefits? - CORRECT ANSWER -Common disaster clause
In Arkansas, an insurance company cannot contest a death benefit claim
from suicide if it occurred after the policy was in force for a minimum of
_____ years(s) - CORRECT ANSWER -2
*incontestability period
An insurer will accept a premium from the insured and continue the
coverage in full force as though it was NOT late during which time period? -
CORRECT ANSWER -Grace period
Which type if rider will waive the premium on a child's life insurance policy
if the parent paying the premium dies? - CORRECT ANSWER -Payor benefit
Joe has a life insurance policy that has a face amount of $300,000. After a
number of years, the policy's cash value accumulates to $50,000 and the
,face amount becomes $350,000. What kind of policy is this? - CORRECT
ANSWER -Universal Life policy
How do interest earnings accumulate in a deferred annuity? - CORRECT
ANSWER -On a tax-deferred basis
How many months can a life insurance policy normally be backdated from
the date of application? - CORRECT ANSWER -6 months
Which is correct concerning Traditional IRAs? - CORRECT ANSWER -
Earnings are taxable when withdrawn
When calculating the amount of life insurance needed for an income
earner, what has to be determined when using the Needs Approach? -
CORRECT ANSWER -The family's financial objectives if the income earner
were to die or become disabled
Which scenario would most life insurance policies exclude coverage for? -
CORRECT ANSWER -An individual who has a hobby racing cars once a
month
A person must be at least ____________ years of age to enter into an
insurance agreement in the state of Arkansas - CORRECT ANSWER -18
What types of life insurance are normally used for key employee
indemnification? - CORRECT ANSWER -Term, whole and universal life
insurance
, In an insurance contract, the element that shows each party is giving
something of value is called - CORRECT ANSWER -Consideration
An insurance company appoints a(n) _______ to transact insurance -
CORRECT ANSWER -Producer
What guarantees that the statements supplied by an insurance applicant
are true? - CORRECT ANSWER -Warranty
Which of the following would be considered an underwriting duty of an
agent? - CORRECT ANSWER -Collecting all applications and initial
premiums
Which is NOT considered rebating? - CORRECT ANSWER -Sharing
commissions with a producer licensed in the same line of business
Rob purchased a standard whole life policy with a $500,000 death benefit
when he was age 30. His insurance agent told him the policy would be paid
up if he reached age 100. The present cash value of the policy equals
$250,000. Rob recently died at age 60. The death benefit would be -
CORRECT ANSWER -$500,000 face amount
Lapsed individual life insurance may be reinstated at any time within: -
CORRECT ANSWER -3 years
COMPLETE PRACTICE QUESTIONS AND
CORRECT ANSWERS WITH DETAILED
EXPLANATIONS ARKANSAS LIFE
INSURANCE PRODUCER LICENSING EXAM
STUDY GUIDE GRADE A+ 2026 EDITION
Erica is 35 years old and owns an IRA. At what age can she begin to receive
distributions without a tax penalty? - CORRECT ANSWER -59 1/2
An interest-sensitive life insurance policy owner may be able to withdraw
the policy's cash value interest free. The provision that allows this is called -
CORRECT ANSWER -Partial surrender
A Renewable Term Life insurance policy can be renewed - CORRECT
ANSWER -At a pre-determined date or age, regardless of the insured's
health
Which does NOT correctly describe the purpose of Social Security? -
CORRECT ANSWER -Provides a source of income for a meaningful standard
of living during retirement
*SS enhances, but does not replace, a sound personal insurance plan
,Index whole life insurance contains a securities component that acts as a(n)
- CORRECT ANSWER -Hedge against inflation
Pat is insured with a life insurance policy and Karen is his primary
beneficiary. They are both involved in an automobile accident where Pat
dies instantly and Karen dies 5 days later. Which policy provision will
protect the rights of the contingent beneficiary to receive the policy
benefits? - CORRECT ANSWER -Common disaster clause
In Arkansas, an insurance company cannot contest a death benefit claim
from suicide if it occurred after the policy was in force for a minimum of
_____ years(s) - CORRECT ANSWER -2
*incontestability period
An insurer will accept a premium from the insured and continue the
coverage in full force as though it was NOT late during which time period? -
CORRECT ANSWER -Grace period
Which type if rider will waive the premium on a child's life insurance policy
if the parent paying the premium dies? - CORRECT ANSWER -Payor benefit
Joe has a life insurance policy that has a face amount of $300,000. After a
number of years, the policy's cash value accumulates to $50,000 and the
,face amount becomes $350,000. What kind of policy is this? - CORRECT
ANSWER -Universal Life policy
How do interest earnings accumulate in a deferred annuity? - CORRECT
ANSWER -On a tax-deferred basis
How many months can a life insurance policy normally be backdated from
the date of application? - CORRECT ANSWER -6 months
Which is correct concerning Traditional IRAs? - CORRECT ANSWER -
Earnings are taxable when withdrawn
When calculating the amount of life insurance needed for an income
earner, what has to be determined when using the Needs Approach? -
CORRECT ANSWER -The family's financial objectives if the income earner
were to die or become disabled
Which scenario would most life insurance policies exclude coverage for? -
CORRECT ANSWER -An individual who has a hobby racing cars once a
month
A person must be at least ____________ years of age to enter into an
insurance agreement in the state of Arkansas - CORRECT ANSWER -18
What types of life insurance are normally used for key employee
indemnification? - CORRECT ANSWER -Term, whole and universal life
insurance
, In an insurance contract, the element that shows each party is giving
something of value is called - CORRECT ANSWER -Consideration
An insurance company appoints a(n) _______ to transact insurance -
CORRECT ANSWER -Producer
What guarantees that the statements supplied by an insurance applicant
are true? - CORRECT ANSWER -Warranty
Which of the following would be considered an underwriting duty of an
agent? - CORRECT ANSWER -Collecting all applications and initial
premiums
Which is NOT considered rebating? - CORRECT ANSWER -Sharing
commissions with a producer licensed in the same line of business
Rob purchased a standard whole life policy with a $500,000 death benefit
when he was age 30. His insurance agent told him the policy would be paid
up if he reached age 100. The present cash value of the policy equals
$250,000. Rob recently died at age 60. The death benefit would be -
CORRECT ANSWER -$500,000 face amount
Lapsed individual life insurance may be reinstated at any time within: -
CORRECT ANSWER -3 years
