TEXAS HEALTH AND LIFE INSURANCE
EXAM QUESTIONS WITH COMPLETE
SOLUTIONS
Why does an insurer have a 2-year suicide clause?
a) because the commissioner of insurance requires it.
b) suicide is never paid for in life insurance.
c)to prevent payment of an immediate claim for a person contemplating suicide.
d) to help an insurer be more profitable. - Answer-Answer: C
To prevent payment of an immediate claim for a person contemplating suicide.
Which of these could the owner of a life insurance policy do when there is a collateral
assignment?
a) determine how the dividends are used.
b) cash surrender the policy.
c) obtain another loan.
d) cancel the policy. - Answer-Answer: A
Determine how the dividends are used.
When only the insurer is allowed to alter an insurance contract, the clause that provides
this is called?
a) ownership
b) entire contract
c) consideration
d) incontestable - Answer-Answer: B
Entire contract
Which of these is required to reinstate a lapsed policy?
a) obtain a loan
b) fill out a new application
c) pay a late fee
d) provide evidence of insurability - Answer-Answer: D
Provide evidence of insurability
The insuring clause in an adjustable life policy has all the following EXCEPT?
a) insured
b) insurer
c) amount of premium
d) amount of death benefit - Answer-Answer: C
Amount of premium
Which of the following cannot request or make a change to alter a life insurance policy?
a) the agent who wrote the policy
b) the policy owner
,c) an executive officer of the insurer
d) a person who has absolute assignment - Answer-Answer: A
The agent who wrote the policy
Which of these cannot sign or request a change in an insurance contract?
a) policy owner
b) insured
c) executive officer of insurer
d) producer of insurer - Answer-Answer: D
Producer of insurer
When the policy owner pays a premium in exchange for the insurer's promise to pay,
what provision is this?
a) consideration
b) entire contract
c) insuring clause
d) changes - Answer-Answer: A
Consideration
When the insurer cannot contest a claim after 2 years, that is called?
a) suicide clause
b) incontestability clause
c) entire contract
d) consideration clause - Answer-Answer: B
Incontestability clause
Misstatement of age or gender on the application will result in?
a) the policy being considered void or cancelled
b) return of premiums
c) death benefit paid adjusted to fit true age and gender
d) full death benefit regardless - Answer-Answer: C
Death benefit paid adjusted to fit true age and gender.
What happens if a person returns a policy during the free look period?
a) the insured may apply for another policy without a medical exam
b) the policy is immediately terminated; the insurer retains the premium for the
underwriting costs
c) a refund of premiums minus the number of days the policy was in effect
d) a full refund of all premiums paid is returned - Answer-Answer: D
A full refund of all premiums paid is returned.
An applicant did not disclose a medial condition on a life insurance application 5 years
later that person died due to the non disclosed condition. The insurer will?
a) keep all premiums and void the policy
b) refund all premiums and void the policy
c) pay the whole amount of the policy to the beneficiary
, d) pay half of the policy to the beneficiary - Answer-Answer: C
Pay the whole amount of the policy to the beneficiary
An applicant lied about their age for a universal life policy. The insurer found out the
truth at the time of death. The insurer will?
a) request the beneficiary to pay back the premiums for the correct age before paying
the death benefit
b) refund all premiums and void the policy
c) pay the policy death benefit to reflect the correct age
d) pay the policy as it was issued - Answer-Answer: C
Pay the policy death benefit to reflect the correct age
A policy owner/insured takes a loan of 1/2 the cash value. The owner doesn't pay any
interest that accumulates on the loan. which of these would be true?
a) dividends are withheld until the loan is paid back
b) interest is added to the loan annually
c) interest is deducted from the loan annually
d) dividends and interest are both withheld until the loan is paid back - Answer-Answer:
B
Interest is added to the loan annually
Which of the following is NOT a non forfeiture option?
a) reduced paid up
b) extended term
c) cash surrender
d) life income - Answer-Answer: D
Life income
When an insured die with an outstanding loan on the policy which of the following
applies?
a) nothing is payable the loan voids the policy's death benefits
b) the death benefit is payable minus any outstanding loans plus interest on the loan
c) all of the death benefit is paid without reductions
d) the loan must be repaid before any death benefits are paid - Answer-Answer: B
The death benefit is payable minus any outstanding loans plus interest on the loan
G has a life policy with his wife listen as primary beneficiary. They both die in a car
accident. They don't know who died first. According to the Uniform Simultaneous Death
Act where will the policy proceeds be paid?
a) wife's estate
b) g's estate
c) g's next of kin
d) wife's next of kin - Answer-Answer: B
G's estate
EXAM QUESTIONS WITH COMPLETE
SOLUTIONS
Why does an insurer have a 2-year suicide clause?
a) because the commissioner of insurance requires it.
b) suicide is never paid for in life insurance.
c)to prevent payment of an immediate claim for a person contemplating suicide.
d) to help an insurer be more profitable. - Answer-Answer: C
To prevent payment of an immediate claim for a person contemplating suicide.
Which of these could the owner of a life insurance policy do when there is a collateral
assignment?
a) determine how the dividends are used.
b) cash surrender the policy.
c) obtain another loan.
d) cancel the policy. - Answer-Answer: A
Determine how the dividends are used.
When only the insurer is allowed to alter an insurance contract, the clause that provides
this is called?
a) ownership
b) entire contract
c) consideration
d) incontestable - Answer-Answer: B
Entire contract
Which of these is required to reinstate a lapsed policy?
a) obtain a loan
b) fill out a new application
c) pay a late fee
d) provide evidence of insurability - Answer-Answer: D
Provide evidence of insurability
The insuring clause in an adjustable life policy has all the following EXCEPT?
a) insured
b) insurer
c) amount of premium
d) amount of death benefit - Answer-Answer: C
Amount of premium
Which of the following cannot request or make a change to alter a life insurance policy?
a) the agent who wrote the policy
b) the policy owner
,c) an executive officer of the insurer
d) a person who has absolute assignment - Answer-Answer: A
The agent who wrote the policy
Which of these cannot sign or request a change in an insurance contract?
a) policy owner
b) insured
c) executive officer of insurer
d) producer of insurer - Answer-Answer: D
Producer of insurer
When the policy owner pays a premium in exchange for the insurer's promise to pay,
what provision is this?
a) consideration
b) entire contract
c) insuring clause
d) changes - Answer-Answer: A
Consideration
When the insurer cannot contest a claim after 2 years, that is called?
a) suicide clause
b) incontestability clause
c) entire contract
d) consideration clause - Answer-Answer: B
Incontestability clause
Misstatement of age or gender on the application will result in?
a) the policy being considered void or cancelled
b) return of premiums
c) death benefit paid adjusted to fit true age and gender
d) full death benefit regardless - Answer-Answer: C
Death benefit paid adjusted to fit true age and gender.
What happens if a person returns a policy during the free look period?
a) the insured may apply for another policy without a medical exam
b) the policy is immediately terminated; the insurer retains the premium for the
underwriting costs
c) a refund of premiums minus the number of days the policy was in effect
d) a full refund of all premiums paid is returned - Answer-Answer: D
A full refund of all premiums paid is returned.
An applicant did not disclose a medial condition on a life insurance application 5 years
later that person died due to the non disclosed condition. The insurer will?
a) keep all premiums and void the policy
b) refund all premiums and void the policy
c) pay the whole amount of the policy to the beneficiary
, d) pay half of the policy to the beneficiary - Answer-Answer: C
Pay the whole amount of the policy to the beneficiary
An applicant lied about their age for a universal life policy. The insurer found out the
truth at the time of death. The insurer will?
a) request the beneficiary to pay back the premiums for the correct age before paying
the death benefit
b) refund all premiums and void the policy
c) pay the policy death benefit to reflect the correct age
d) pay the policy as it was issued - Answer-Answer: C
Pay the policy death benefit to reflect the correct age
A policy owner/insured takes a loan of 1/2 the cash value. The owner doesn't pay any
interest that accumulates on the loan. which of these would be true?
a) dividends are withheld until the loan is paid back
b) interest is added to the loan annually
c) interest is deducted from the loan annually
d) dividends and interest are both withheld until the loan is paid back - Answer-Answer:
B
Interest is added to the loan annually
Which of the following is NOT a non forfeiture option?
a) reduced paid up
b) extended term
c) cash surrender
d) life income - Answer-Answer: D
Life income
When an insured die with an outstanding loan on the policy which of the following
applies?
a) nothing is payable the loan voids the policy's death benefits
b) the death benefit is payable minus any outstanding loans plus interest on the loan
c) all of the death benefit is paid without reductions
d) the loan must be repaid before any death benefits are paid - Answer-Answer: B
The death benefit is payable minus any outstanding loans plus interest on the loan
G has a life policy with his wife listen as primary beneficiary. They both die in a car
accident. They don't know who died first. According to the Uniform Simultaneous Death
Act where will the policy proceeds be paid?
a) wife's estate
b) g's estate
c) g's next of kin
d) wife's next of kin - Answer-Answer: B
G's estate
