TEXAS GENERAL LINES LIFE
ACCIDENT AND HEALTH INSURANCE
2024|2025 PRACTICE EXAM
QUESTIONS AND CORRECT ANSWERS
GRADED A++++
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 answers 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 answers 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 answers 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 answers 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 answers 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 answers 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 answers 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 answers D- Premiums are payable throughout the insured's lifetime, and coverage
continues until the insured's death
9) A life insurance policy that covers two parties, but only pays when the last party dies is known as:
A- Joint Life
B- Contingent Life
C- Other insured Life
D- Survivorship Life - correct answers D- Survivorship Life
10) Which of the following contracts requires that a series of benefit payments be made at specified
intervals?
A- 20-Pay Life
B- Modified Whole Life
C- Annuity
D- Ordinary Whole Life - correct answers C- Annuity
11) If a client wants cash value life insurance with a flexible premium and an adjustable death benefit
that will allow the policy owner a choice of various cash value investment options, he should buy:
, A- Variable Life
B- Universal Life
C- Adjustable Life
D- Variable/Universal Life - correct answers D- Variable/Universal Life
12) If a person wants to invest a lump sum in an annuity that may appreciate along with market and
economic conditions, they should buy a:
A- Flexible premium Annuity
B- Fixed Annuity
C- Deferred Annuity
D- Variable Annuity - correct answers D- Variable Annuity
13) You have a client that is a real estate agent. Which of the following types of permanent protection
is best for this type of client?
A- Variable life
B- Universal life
C- Survivorship life
D- Adjustable life - correct answers D- Adjustable life
14) In order to sell variable life insurance you must be registered with which of the following?
A- The SEC
B- The State
C- The NYSE
D- The NASD - correct answers D- The NASD
15) Which of the following is an example of a Limited-Pay Life policy:
A- Traditional Whole Life
B- Endowment at 65
C- 10 year Renewable Term Life
D- 20-Pay Life - correct answers D- 20-Pay Life
16) An insurance producer selling a Variable Annuity whose cash value depends on the performance
of an underlying investment account must be registered with: - correct answers D- The Financial
Industry Regulatory Authority (FINRA, formerly the NASD)
ACCIDENT AND HEALTH INSURANCE
2024|2025 PRACTICE EXAM
QUESTIONS AND CORRECT ANSWERS
GRADED A++++
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 answers 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 answers 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 answers 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 answers 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 answers 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 answers 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 answers 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 answers D- Premiums are payable throughout the insured's lifetime, and coverage
continues until the insured's death
9) A life insurance policy that covers two parties, but only pays when the last party dies is known as:
A- Joint Life
B- Contingent Life
C- Other insured Life
D- Survivorship Life - correct answers D- Survivorship Life
10) Which of the following contracts requires that a series of benefit payments be made at specified
intervals?
A- 20-Pay Life
B- Modified Whole Life
C- Annuity
D- Ordinary Whole Life - correct answers C- Annuity
11) If a client wants cash value life insurance with a flexible premium and an adjustable death benefit
that will allow the policy owner a choice of various cash value investment options, he should buy:
, A- Variable Life
B- Universal Life
C- Adjustable Life
D- Variable/Universal Life - correct answers D- Variable/Universal Life
12) If a person wants to invest a lump sum in an annuity that may appreciate along with market and
economic conditions, they should buy a:
A- Flexible premium Annuity
B- Fixed Annuity
C- Deferred Annuity
D- Variable Annuity - correct answers D- Variable Annuity
13) You have a client that is a real estate agent. Which of the following types of permanent protection
is best for this type of client?
A- Variable life
B- Universal life
C- Survivorship life
D- Adjustable life - correct answers D- Adjustable life
14) In order to sell variable life insurance you must be registered with which of the following?
A- The SEC
B- The State
C- The NYSE
D- The NASD - correct answers D- The NASD
15) Which of the following is an example of a Limited-Pay Life policy:
A- Traditional Whole Life
B- Endowment at 65
C- 10 year Renewable Term Life
D- 20-Pay Life - correct answers D- 20-Pay Life
16) An insurance producer selling a Variable Annuity whose cash value depends on the performance
of an underlying investment account must be registered with: - correct answers D- The Financial
Industry Regulatory Authority (FINRA, formerly the NASD)
