California Life, Accident, and Health Insurance Final
Exam Questions and Answers Already Passed
What distinguishes a deferred annuity from an immediate annuity? - AnswerThe time at
which benefit payments start
.Cindy buys a 10-year certain annuity with an installment refund. After receiving monthly
payments for 5 years, Cindy dies. How many remaining payments will the insurer make
to her beneficiary? - Answer60 payments
.What is a common reason people purchase an annuity? - AnswerTo protect against the
risk of outliving their financial resources
.What kind of annuity pays income to two annuitants until their deaths? - AnswerJoint
and survivor annuity
.What is a joint and survivor annuity? - AnswerProvides payments the annuity to two
people. If either person dies, the same income payments continue to the survivor for
life. When the surviving annuitant dies, no further payments are made to anyone.
.Victoria owns a life annuity and elects to receive annuity payments monthly for the
remainder of her life with "ten years certain". Her annuity will make payments -
Answerfor a minimum of 120 months and a maximum of the remainder of her life
.Which of the following statements regarding a life insurance policy dividend is TRUE? -
AnswerIt is the distribution of excess of funds accumulated by the insurer on
participating policies.
.An insured owned by its policyholders is called a - Answermutual insurer
.An insurer enters into a contract with a third party to insure itself against losses from
insurance policies it issues. What is the agreement called? - AnswerReinsurance
.What is reinsurance? - AnswerAn arrangement by which an insurance company
transfers a portion of a risk it has assumed to another insurer
.Which of the following is NOT a characteristic of reinsurance? - AnswerIncreases the
unearned premium reserve
.Which of the following is a contract that involves one party which indemnifies another
when a loss arises from an unknown event? - AnswerInsurance policy
.What is an insurance policy? - AnswerA contract where one party promises to
indemnify another against loss that arises from an unknown event
, .What is residual disability income insurance payments based on? - AnswerThe amount
of the insured's income is reduced by the disability
.Manuel is considered to be a disabled person as defined by the Americans with
Disabilities Act (ADA). As such, he is unable to perform any of the following life activities
EXCEPT - AnswerDriving
.Which of the following is NOT a provision in a disability income policy? -
AnswerDeductible and coinsurance provision
.Which of these statements is NOT true concerning recurrent disabilities? - AnswerThe
insurer continues coverage after a new elimination period
.Kim is insured under a disability income insurance policy with an "own-occupation"
clause. She was recently injured in an automobile accident and can no longer perform
the tasks of her job. Kim is now considered to be - Answertotally disabled
.What percentage of eligible employees must participate in a noncontributory group
health plan before it can be put in effect? - Answer100%
.Business Overhead Expense Insurance pays for - Answerbusiness expenses when a
business owner becomes disabled
.Minimum participation standards exist for group health insurance plans in order to -
Answerprevent adverse selection
.The problem of overinsurance is addressed in which health insurance provision? -
AnswerCoordination of benefits
.What is the purpose of the coordination of benefits (COB) provision? - AnswerTo avoid
duplication of benefit payments and overinsurance when an individual is covered under
more than one group health plan
.Who is financially liable for the payment of covered claims in a fully insured group
health plan? - AnswerInsurer
.The insurer has the option of terminating a health insurance policy on a date stated in
the contract. What type of policy is this? - AnswerOptionally renewable
.What is an optionally renewable policy? - AnswerA provision allowing an insurer to
terminate the policy on a date specified in the contract
.Bruce is involved in an accident and becomes totally and permanently disabled. His
insurance policy continues in force without payment of further premiums. Which policy
provision is responsible for this? - AnswerWaiver of premium provision
Exam Questions and Answers Already Passed
What distinguishes a deferred annuity from an immediate annuity? - AnswerThe time at
which benefit payments start
.Cindy buys a 10-year certain annuity with an installment refund. After receiving monthly
payments for 5 years, Cindy dies. How many remaining payments will the insurer make
to her beneficiary? - Answer60 payments
.What is a common reason people purchase an annuity? - AnswerTo protect against the
risk of outliving their financial resources
.What kind of annuity pays income to two annuitants until their deaths? - AnswerJoint
and survivor annuity
.What is a joint and survivor annuity? - AnswerProvides payments the annuity to two
people. If either person dies, the same income payments continue to the survivor for
life. When the surviving annuitant dies, no further payments are made to anyone.
.Victoria owns a life annuity and elects to receive annuity payments monthly for the
remainder of her life with "ten years certain". Her annuity will make payments -
Answerfor a minimum of 120 months and a maximum of the remainder of her life
.Which of the following statements regarding a life insurance policy dividend is TRUE? -
AnswerIt is the distribution of excess of funds accumulated by the insurer on
participating policies.
.An insured owned by its policyholders is called a - Answermutual insurer
.An insurer enters into a contract with a third party to insure itself against losses from
insurance policies it issues. What is the agreement called? - AnswerReinsurance
.What is reinsurance? - AnswerAn arrangement by which an insurance company
transfers a portion of a risk it has assumed to another insurer
.Which of the following is NOT a characteristic of reinsurance? - AnswerIncreases the
unearned premium reserve
.Which of the following is a contract that involves one party which indemnifies another
when a loss arises from an unknown event? - AnswerInsurance policy
.What is an insurance policy? - AnswerA contract where one party promises to
indemnify another against loss that arises from an unknown event
, .What is residual disability income insurance payments based on? - AnswerThe amount
of the insured's income is reduced by the disability
.Manuel is considered to be a disabled person as defined by the Americans with
Disabilities Act (ADA). As such, he is unable to perform any of the following life activities
EXCEPT - AnswerDriving
.Which of the following is NOT a provision in a disability income policy? -
AnswerDeductible and coinsurance provision
.Which of these statements is NOT true concerning recurrent disabilities? - AnswerThe
insurer continues coverage after a new elimination period
.Kim is insured under a disability income insurance policy with an "own-occupation"
clause. She was recently injured in an automobile accident and can no longer perform
the tasks of her job. Kim is now considered to be - Answertotally disabled
.What percentage of eligible employees must participate in a noncontributory group
health plan before it can be put in effect? - Answer100%
.Business Overhead Expense Insurance pays for - Answerbusiness expenses when a
business owner becomes disabled
.Minimum participation standards exist for group health insurance plans in order to -
Answerprevent adverse selection
.The problem of overinsurance is addressed in which health insurance provision? -
AnswerCoordination of benefits
.What is the purpose of the coordination of benefits (COB) provision? - AnswerTo avoid
duplication of benefit payments and overinsurance when an individual is covered under
more than one group health plan
.Who is financially liable for the payment of covered claims in a fully insured group
health plan? - AnswerInsurer
.The insurer has the option of terminating a health insurance policy on a date stated in
the contract. What type of policy is this? - AnswerOptionally renewable
.What is an optionally renewable policy? - AnswerA provision allowing an insurer to
terminate the policy on a date specified in the contract
.Bruce is involved in an accident and becomes totally and permanently disabled. His
insurance policy continues in force without payment of further premiums. Which policy
provision is responsible for this? - AnswerWaiver of premium provision
