LLQP LIFE INSURANCE ACTUAL TEST
PAPER QUESTIONS AND SOLUTIONS
COMPLETE STUDY GUIDE
●● Fair Market Value
Answer: the actual value of an asset, or the price for which it can
reasonably be expected to sell in the open market
●● Key employee Life Insurance
Answer: insurance on the life of a key employee to cover the possibility
of an income loss and/or an increase in expenses resulting from the key
employee's death
●● lagacies
Answer: money, property, or position left in a will to someone
●● life expectancy
Answer: average number of years that person within a certain group and
of a certain age can be expected to live
●● mortality rate
Answer: The probability of dying at a specific age
,●● mortality table/life table
Answer: life expectancy and probability of death statistics
●● Probability of death
Answer: A person within a certain group and of a certain age will die
before their next birthday
●● Rollover
Answer: the process of moving a retirement account balance to another
qualified account without incurring a tax penalty
●● Risk Avoidance
Answer: avoiding an act that would create a risk
●● Risk Reduction Strategies
Answer: Taking action to reduce the probability or severity of risk
●● Risk Retention strategy
Answer: Accepting the fact of exposure to risk and accepting the
consequences if risk is realized. ie extended warranty
●● Risk Transfer
, Answer: buying insurance to shift the risk of financial loss to an
insurance company
●● Decreasing Term Insurance
Answer: a form of term insurance in which the benefits that will be paid
to the beneficiary are reduced over time and the premium remains
constant
●● incontestability provision
Answer: After an insurance policy has been in effect for 2 years,
company cannot claim that a statement in app was meant to defraud
insurer
●● Increasing Term Insurance
Answer: Term life insurance in which the death benefit increases
periodically over the policy's term. Usually purchased as a cost of living
rider to a whole life policy. (See cost of living rider)
●● Insured
Answer: a policyholder that has covered for liability
●● joint first-to-die insurance
Answer: a single coverage is placed on two or more lives insured. death
benefits is paid out upon the death of the 1st person to die
PAPER QUESTIONS AND SOLUTIONS
COMPLETE STUDY GUIDE
●● Fair Market Value
Answer: the actual value of an asset, or the price for which it can
reasonably be expected to sell in the open market
●● Key employee Life Insurance
Answer: insurance on the life of a key employee to cover the possibility
of an income loss and/or an increase in expenses resulting from the key
employee's death
●● lagacies
Answer: money, property, or position left in a will to someone
●● life expectancy
Answer: average number of years that person within a certain group and
of a certain age can be expected to live
●● mortality rate
Answer: The probability of dying at a specific age
,●● mortality table/life table
Answer: life expectancy and probability of death statistics
●● Probability of death
Answer: A person within a certain group and of a certain age will die
before their next birthday
●● Rollover
Answer: the process of moving a retirement account balance to another
qualified account without incurring a tax penalty
●● Risk Avoidance
Answer: avoiding an act that would create a risk
●● Risk Reduction Strategies
Answer: Taking action to reduce the probability or severity of risk
●● Risk Retention strategy
Answer: Accepting the fact of exposure to risk and accepting the
consequences if risk is realized. ie extended warranty
●● Risk Transfer
, Answer: buying insurance to shift the risk of financial loss to an
insurance company
●● Decreasing Term Insurance
Answer: a form of term insurance in which the benefits that will be paid
to the beneficiary are reduced over time and the premium remains
constant
●● incontestability provision
Answer: After an insurance policy has been in effect for 2 years,
company cannot claim that a statement in app was meant to defraud
insurer
●● Increasing Term Insurance
Answer: Term life insurance in which the death benefit increases
periodically over the policy's term. Usually purchased as a cost of living
rider to a whole life policy. (See cost of living rider)
●● Insured
Answer: a policyholder that has covered for liability
●● joint first-to-die insurance
Answer: a single coverage is placed on two or more lives insured. death
benefits is paid out upon the death of the 1st person to die
