TEXAS GENERAL LINES LIFE,
ACCIDENT AND HEALTH INSURANCE 2
LATEST VERSIONS 2024-2025 ACTUAL
EXAM COMPLETE 500 QUESTIONS AND
CORRECT DETAILED ANSWERS
(VERIFIED ANSWERS) |ALREADY
GRADED A+
VERSION 1
1) Sandra Timms, age 27, is advised by her producer to
purchase Life insurance to cover a 20-year-amortized
$50,000 business-improvement loan. Which of the
following plans would adequately protect Ms. Timms at the
minimum premium outlay?
A- $50,000 Whole Life policy
B- $50,000 Level Term policy for 20 years
C- $50,000 20 Pay Life policy
D- $50,000 Decreasing Term policy for 20 years Correct
Answer D—A $50,000 Decreasing Term policy for 20
years
Explanation: The key here is "minimum premium".
Term is the most inexpensive type of coverage. Since
Sandra's $50,000 loan will be paid off over 20 years
,and the loan balance will decrease each year,
Decreasing Term makes sense. Decreasing Term is
not renewable.
2) A 45-year old customer who is seeking to supplement
his retirement income at age 65 would not buy a:
A- Deferred Annuity
B- Equity Indexed Annuity
C- Variable Annuity
D- Immediate Annuity Correct Answer B- Equity Indexed
Annuity
3) John Livingston owns a 30-Pay Life policy that he
purchased at the age of 30. The cash value will equal the
face amount of the policy when he reaches the age of:
A- 60
B- 70
C- 100
D- 30 Correct Answer C- 100
Explanation: Limited Pay Life insurance policies such
as Life Paid Up at 65 or 20-Pay Life are simply
variations of Whole Life policies. The cash value will
equal face amount of the policy (at least) at the
maturity of the policy, which is always age 100 on
Whole Life policies. These limited-pay policies are
designed so that the insured may pay his or her
premiums faster and be "paid up" at a certain age.
However, just because the premiums are paid up
doesn't mean the policy has matured.
,4) Which of the following is an example of a Limited-Pay
Life policy?
A- Universal life
B- Whole Life
C- Life Paid-Up at Age 65
D- Renewable Term to Age 70 Correct Answer C- Life
Paid-Up at Age 65
5) Which of the following policies provides the greatest
amount of protection for an insured's premium dollar as
well as some cash accumulation?
A- Annuity
B- Whole Life
C- Term
D- Limited-Pay Life Correct Answer B- Whole Life
If we had not mentioned cash accumulation, the
answer would have been Term. However, Term has no
cash value, so the answer is Whole Life, which is the
most inexpensive type of permanent insurance and is
required to have a cash value after the third policy
year. Although Limited Pay Life is a type of Whole
Life, it is incorrect since it is usually quite expensive
due to the shortened pay-in period. Annuities have no
cash value except the money the annuitant paid in.
Since there is no death benefit, no protection is
offered.
6) Which of the following individual policy conversions is
usually permitted without any evidence of insurability?
, Correct Answer C- Conversion from a Term policy to a
Whole Life policy
7) Which of the following is NOT correct regarding
Ordinary Whole Life policies?
A- The premiums payments are owed annually until you
die or reach age 100
B- The cash value grows more quickly in the beginning
years of the policy
C- Coverage lasts for your own life
D- Ordinary Whole Life is a type of permanent insurance
Correct Answer D- Ordinary Whole Life is a type of
permanent insurance
8) Which of the following statements is true about the
premium payment schedule for a Whole Life policy?
A- Premiums are payable for a designated period of time
only, after which coverage is no longer provided
B- Premiums are payable until the insured's retirement
only, after which coverage is continued automatically until
the insured's death
C- One premium, in the amount of the insured's choice, is
payable at the time of application, and the balance of the
premiums is deducted from the face amount of the policy
at the time of the insured's death
D- Premiums are payable throughout the insured's
lifetime, and coverage continues until the insured's death
Correct Answer D- Premiums are payable throughout the
ACCIDENT AND HEALTH INSURANCE 2
LATEST VERSIONS 2024-2025 ACTUAL
EXAM COMPLETE 500 QUESTIONS AND
CORRECT DETAILED ANSWERS
(VERIFIED ANSWERS) |ALREADY
GRADED A+
VERSION 1
1) Sandra Timms, age 27, is advised by her producer to
purchase Life insurance to cover a 20-year-amortized
$50,000 business-improvement loan. Which of the
following plans would adequately protect Ms. Timms at the
minimum premium outlay?
A- $50,000 Whole Life policy
B- $50,000 Level Term policy for 20 years
C- $50,000 20 Pay Life policy
D- $50,000 Decreasing Term policy for 20 years Correct
Answer D—A $50,000 Decreasing Term policy for 20
years
Explanation: The key here is "minimum premium".
Term is the most inexpensive type of coverage. Since
Sandra's $50,000 loan will be paid off over 20 years
,and the loan balance will decrease each year,
Decreasing Term makes sense. Decreasing Term is
not renewable.
2) A 45-year old customer who is seeking to supplement
his retirement income at age 65 would not buy a:
A- Deferred Annuity
B- Equity Indexed Annuity
C- Variable Annuity
D- Immediate Annuity Correct Answer B- Equity Indexed
Annuity
3) John Livingston owns a 30-Pay Life policy that he
purchased at the age of 30. The cash value will equal the
face amount of the policy when he reaches the age of:
A- 60
B- 70
C- 100
D- 30 Correct Answer C- 100
Explanation: Limited Pay Life insurance policies such
as Life Paid Up at 65 or 20-Pay Life are simply
variations of Whole Life policies. The cash value will
equal face amount of the policy (at least) at the
maturity of the policy, which is always age 100 on
Whole Life policies. These limited-pay policies are
designed so that the insured may pay his or her
premiums faster and be "paid up" at a certain age.
However, just because the premiums are paid up
doesn't mean the policy has matured.
,4) Which of the following is an example of a Limited-Pay
Life policy?
A- Universal life
B- Whole Life
C- Life Paid-Up at Age 65
D- Renewable Term to Age 70 Correct Answer C- Life
Paid-Up at Age 65
5) Which of the following policies provides the greatest
amount of protection for an insured's premium dollar as
well as some cash accumulation?
A- Annuity
B- Whole Life
C- Term
D- Limited-Pay Life Correct Answer B- Whole Life
If we had not mentioned cash accumulation, the
answer would have been Term. However, Term has no
cash value, so the answer is Whole Life, which is the
most inexpensive type of permanent insurance and is
required to have a cash value after the third policy
year. Although Limited Pay Life is a type of Whole
Life, it is incorrect since it is usually quite expensive
due to the shortened pay-in period. Annuities have no
cash value except the money the annuitant paid in.
Since there is no death benefit, no protection is
offered.
6) Which of the following individual policy conversions is
usually permitted without any evidence of insurability?
, Correct Answer C- Conversion from a Term policy to a
Whole Life policy
7) Which of the following is NOT correct regarding
Ordinary Whole Life policies?
A- The premiums payments are owed annually until you
die or reach age 100
B- The cash value grows more quickly in the beginning
years of the policy
C- Coverage lasts for your own life
D- Ordinary Whole Life is a type of permanent insurance
Correct Answer D- Ordinary Whole Life is a type of
permanent insurance
8) Which of the following statements is true about the
premium payment schedule for a Whole Life policy?
A- Premiums are payable for a designated period of time
only, after which coverage is no longer provided
B- Premiums are payable until the insured's retirement
only, after which coverage is continued automatically until
the insured's death
C- One premium, in the amount of the insured's choice, is
payable at the time of application, and the balance of the
premiums is deducted from the face amount of the policy
at the time of the insured's death
D- Premiums are payable throughout the insured's
lifetime, and coverage continues until the insured's death
Correct Answer D- Premiums are payable throughout the
