LIFE & HEALTH LICENSE TEST TEXAS EXAM FX LATEST UPDATE EXPERT VERIFIED QUESTIONS AND ANSWERS REAL EXAM

LIFE & HEALTH LICENSE TEST TEXAS EXAM FX
2024/2025 LATEST UPDATE EXPERT VERIFIED
QUESTIONS AND ANSWERS REAL EXAM

WhatYisYtheYmainYpurposeYofYtheYSeven-payYTest?Y-YcorrectYanswer-
ItYdeterminesYifYtheYinsuranceYpolicyYisYanYMEC.


WhichYofYtheYfollowingYinsuranceYarrangementsYwillYbeYappropriateYforYaYparentYbuyingYaYlifeYinsurance
YpolicyYonYaYchildYwhereYtheYparentYisYtheYpolicyowner?Y-YcorrectYanswer-Third-partyYownership




WhichYofYtheYfollowingYbestYdefinesYtheY"owner"YasYitYpertainsYtoYlifeYsettlementYcontracts?Y-
YcorrectYanswer-TheYpolicyownerYofYtheYlifeYinsuranceYpolicy




WhichYofYtheYfollowingYisYNOTYanYexampleYofYaYbusinessYuseYofYLifeYInsurance?Y-YcorrectYanswer-
WorkersYCompensation


AnYinsuredYunderYaYlifeYinsuranceYpolicyYhasYbeenYdiagnosedYwithYaYterminalYillnessYandYhasY6YmonthsYt
oYlive.YTheYinsuredYknowsYthatYhisYfinancialYstateYwillYworsenYevenYmoreYwithYtheYupcomingYmedicalYex
penses.YWhatYoptionYcouldYtheYinsuredYutilize?Y-YcorrectYanswer-ViaticalYsettlement


WhichYofYtheYfollowingYisYINCORRECTYconcerningYaYnoncontributoryYgroupYplan?Y-YcorrectYanswer-
TheYemployerYreceivesYaYmasterYpolicy,YandYemployeesYreceiveYaYcertificateYofYinsurance.


AYlifeYinsuranceYpolicyYusedYtoYfundYanYagreementYthatYcontractuallyYestablishesYtheYintentYofYsomeoneYt
oYpurchaseYaYbusinessYuponYtheYinsuredYbusinessYowner'sYdeathYisYaY-YcorrectYanswer-Buy-
sellYagreement.


WhichYofYtheYfollowingYemployeesYinsuredYunderYaYgroupYlifeYplanYwouldYbeYallowedYtoYconvertYtoYindi
vidualYinsuranceYofYtheYsameYcoverageYonceYtheYplanYisYterminated?Y-YcorrectYanswer-
ThoseYwhoYhaveYbeenYinsuredYunderYtheYplanYforYatYleastY5Yyears


AYpartnershipYbuy-
sellYagreementYinYwhichYeachYpartnerYpurchasesYinsuranceYonYtheYlifeYofYeachYofYtheYotherYpartnersYisYcal
ledYaY-YcorrectYanswer-Cross-purchaseYplan.

,AYproducerYisYhelpingYaYmarriedYcoupleYdetermineYtheYfinancialYneedsYofYtheirYchildrenYinYtheYeventYone
YorYbothYshouldYdieYprematurely.YThisYisYaYpersonalYuseYofYlifeYinsuranceYknownYasY-YcorrectYanswer-

SurvivorYprotection


WhichYofYtheYfollowingYisYNOTYtrueYregardingYpolicyYloans?Y-YcorrectYanswer-
MoneyYborrowedYfromYtheYcashYvalueYisYtaxable.


WhoYisYtheYownerYandYwhoYisYtheYbeneficiaryYonYaYKeyYPersonYLifeYInsuranceYpolicy?Y-YcorrectYanswer-
TheYemployerYisYtheYownerYandYbeneficiary.


WhatYdoesY"liquidity"YreferYtoYinYaYlifeYinsuranceYpolicy?Y-YcorrectYanswer-
CashYvaluesYcanYbeYborrowedYatYanyYtime.


WhichYofYtheYfollowingYisYanYexampleYofYliquidityYinYaYlifeYinsuranceYcontract?Y-YcorrectYanswer-
TheYcashYvalueYavailableYtoYtheYpolicyowner


IfYanYimmediateYannuityYisYpurchasedYwithYtheYfaceYamountYatYdeathYorYwithYtheYcashYvalueYatYsurrender,
YthisYwouldYbeYconsideredYaY-YcorrectYanswer-SettlementYoption.




AllYofYtheYfollowingYareYbusinessYusesYofYlifeYinsuranceYEXCEPTY-YcorrectYanswer-
FundingYagainstYgeneralYcompanyYfinancialYloss.


GroupYlifeYinsuranceYisYaYsingleYpolicyYwrittenYtoYprovideYcoverageYtoYmembersYofYaYgroup.YWhichYofYth
eYfollowingYstatementsYconcerningYgroupYlifeYisYCORRECT?Y-YcorrectYanswer-
100%YparticipationYofYmembersYisYrequiredYinYnoncontributoryYplans.


WhichYofYtheYfollowingYisYtrueYregardingYtaxationYofYacceleratedYbenefitsYunderYaYlifeYinsuranceYpolicy?Y
-YcorrectYanswer-TheyYareYtaxYfreeYtoYterminallyYillYinsured.


WhichYofYtheYfollowingYdescribesYtheYtaxYadvantageYofYaYqualifiedYretirementYplan?Y-YcorrectYanswer-
TheYearningsYinYtheYplanYaccumulateYtaxYdeferred.


AllYofYtheYfollowingYareYbusinessYusesYofYlifeYinsuranceYEXCEPTY-YcorrectYanswer-
FundingYagainstYgeneralYcompanyYfinancialYloss.

, AllYofYtheYfollowingYstatementsYconcerningYtheYuseYofYlifeYinsuranceYasYanYExecutiveYBonusYareYcorrectY
EXCEPTY-YcorrectYanswer-TheYpolicyYisYownedYbyYtheYcompany.


AllYofYtheYfollowingYstatementsYconcerningYanYemployerYsponsoredYnonqualifiedYretirementYplanYareYtru
eYEXCEPTY-YcorrectYanswer-
TheYemployerYcanYreceiveYaYcurrentYtaxYdeductionYforYanyYcontributionsYmadeYtoYtheYplan.


WhatYisYtheYnumberYofYcreditsYrequiredYforYfullyYinsuredYstatusYforYSocialYSecurityYdisabilityYbenefits?Y-
YcorrectYanswer-40




AllYofYtheYfollowingYareYexamplesYofYthird-partyYownershipYofYaYlifeYinsuranceYpolicyYEXCEPTY-
YcorrectYanswer-

AnYinsuredYborrowsYmoneyYfromYtheYbankYandYmakesYaYcollateralYassignmentYofYaYpartYofYtheYdeathYben
efitYtoYsecureYtheYloan.


TheYemployeeYusuallyYhasYaYperiodYofY?YdaysYafterYterminatingYfromYtheYgroupYinYorderYtoYexerciseYtheY
conversionYoption.YDuringYthisYtime,YtheYemployeeYisYstillYcoveredYunderYtheYoriginalYgroupYpolicy.Y-
YcorrectYanswer-31




WhichYofYtheYfollowingYisYtheYbestYreasonYtoYpurchaseYlifeYinsuranceYratherYthanYannuities?Y-
YcorrectYanswer-ToYcreateYanYestate




WhichYofYtheYfollowingYdescribesYtheYtaxYadvantageYofYaYqualifiedYretirementYplanY-YcorrectYanswer-
TheYearningsYinYtheYplanYaccumulateYtaxYdeferred.


InYaYdirectYrollover,YhowYisYtheYmoneyYtransferredYfromYoneYplanYtoYtheYnewYone?Y-YcorrectYanswer-
FromYtrusteeYtoYtrustee


AllYofYtheYfollowingYareYcharacteristicsYofYgroupYlifeYinsuranceYEXCEPTY-YcorrectYanswer-
PremiumsYareYdeterminedYbyYtheYage,YsexYandYoccupationYofYeachYindividualYcertificateYholder.


TheYminimumYnumberYofYcreditsYrequiredYforYPARTIALLYYinsuredYstatusYforYSocialYSecurityYdisabilityY
benefitsYisY-YcorrectYanswer-6Ycredits.