K
C
CALIFORNIA LIFE EXAM
LO
QUESTIONS AND CORRECT
VERIFIED ANSWERS 100%
YC
GUARANTEED PASS A+
D
GRADED
U
ST
,1. Julie has a $100,000 30-year mortgage on her new home. What type of life insurance could
she purchase that is designed to pay off the loan balance if she dies within the 30-year period?
A. Adjustable life insurance
B. Decreasing term insurance
C. Increasing term insurance
K
D. Modified life insurance - ANS B. Decreasing term insurance
2. Which of the following is considered to be a situation that has the potential for loss?
C
A. Law of large numbers
B. Adverse Selection
LO
C. Loss exposure
D. Risk transfer - ANS C. Loss exposure
3. Which Social Security status does a worker with 6 quarters of coverage during the last
13-quarter period have?
YC
A. Partially insured
B. Fully insured
C. Currently insured
D. Not insured - ANS C. Currently insured
D
4. In order to be considered "currently insured" under Social Security, an individual must be
credited with:
U
A. 12 quarters of coverage during the last 26-quarter period
B. 6 quarters of coverage during the last 13-quarter period
C. 15 total quarters of coverage
ST
D. 30 total quarters of coverage - ANS B. 6 quarters of coverage during the 13-quarter period
5. An insurance company entitled to transact business in California is called a(n):
A. authorized carrier
B. permitted carrier
C. admitted carrier
D. valid carrier - ANS C. admitted carrier
6. What is an insurance solicitor authorized to do?
,A. Settle life insurance claims
B. Manage an insurance agency
C. Solicit insurance
D. Help an agent or broker sell insurance - ANS D. Help an agent or broker sell insurance
Which of the following is NOT considered a definition of risk?
A. The potential of loss
B. The cause of loss
C. Exposure to danger
K
D. Uncertainty - ANS B. The cause of loss
8. A life insurance policy where the insured can choose where the cash value can be invested is
C
called:
A. whole life
LO
B. variable life
C. modified life
D. universal life - ANS B. variable life
9. Which of the following is NOT a requirement of a contract?
YC
A. Parties involved must be competent
B. Equal consideration is required between the involved parties
C. Contract must have a legal purpose
D. Offer and acceptance must be involved - ANS B. Equal consideration is required between
the involved parties
D
10. A representation may be altered or withdrawn:
U
A. anytime with the applicant's initials
B. anytime with the insurer's approval
C. only before the insurance is in effect
ST
D. only after the policy has been issued - ANS C. only before the insurance is in effect
11. According to the California Insurance Code, what is the maximum penalty per violation for
anyone who unwilfully commits an unfair method of competition?
A. $1,000
B. $5,000
C. $7,000
D. $10,000 - ANS B. $5,000
, 12. Tim was recently terminated from his employment and opted to change his existing group
term life insurance to individual permanent life insurance. What is this process called?
A. Replacement
B. Conversion
C. Transformation
D. Reinstatement - ANS B. Conversion
13. Which of the following describes a contributory group insurance plan?
K
A. All of the premium is paid by the employer
B. Part of the premium is paid by the employee
C. Employees are eligible for policy dividends
C
D. Federal government contributes a portion of the employee's premium - ANS B. Part of the
premium is paid by the employee
LO
14. Which of the following acts is NOT a Federal offense committed by an insurance agent?
A. Embezzlement
B. Insurance fraud
C. Misrepresentation on an insurance application
YC
D. Falsify records - ANS C. Misrepresentation on an insurance application
15. Dorian exercised a nonforfeiture option by using his life policy's cash value to purchase an
extended term insurance option. When the term insurance expires,
A. he has the option of resuming the original policy and paying the same premium
D
B. the coverage can be extended with a lump sum payment
C. all remaining cash values are paid to the policyowner
D. the protection ends - ANS D. the protection ends
U
16. The California Insurance Code defines "policy" as a(n):
ST
A. accepted offer
B. promissory arrangement
C. written contract
D. written quotation - ANS C. written contract
17. Which policy provision protects the policyowner from unintentional lapse of the contract?
A. Grace period
B. Free look period
C. Incontestability
D. Settlement options - ANS A. Grace period
C
CALIFORNIA LIFE EXAM
LO
QUESTIONS AND CORRECT
VERIFIED ANSWERS 100%
YC
GUARANTEED PASS A+
D
GRADED
U
ST
,1. Julie has a $100,000 30-year mortgage on her new home. What type of life insurance could
she purchase that is designed to pay off the loan balance if she dies within the 30-year period?
A. Adjustable life insurance
B. Decreasing term insurance
C. Increasing term insurance
K
D. Modified life insurance - ANS B. Decreasing term insurance
2. Which of the following is considered to be a situation that has the potential for loss?
C
A. Law of large numbers
B. Adverse Selection
LO
C. Loss exposure
D. Risk transfer - ANS C. Loss exposure
3. Which Social Security status does a worker with 6 quarters of coverage during the last
13-quarter period have?
YC
A. Partially insured
B. Fully insured
C. Currently insured
D. Not insured - ANS C. Currently insured
D
4. In order to be considered "currently insured" under Social Security, an individual must be
credited with:
U
A. 12 quarters of coverage during the last 26-quarter period
B. 6 quarters of coverage during the last 13-quarter period
C. 15 total quarters of coverage
ST
D. 30 total quarters of coverage - ANS B. 6 quarters of coverage during the 13-quarter period
5. An insurance company entitled to transact business in California is called a(n):
A. authorized carrier
B. permitted carrier
C. admitted carrier
D. valid carrier - ANS C. admitted carrier
6. What is an insurance solicitor authorized to do?
,A. Settle life insurance claims
B. Manage an insurance agency
C. Solicit insurance
D. Help an agent or broker sell insurance - ANS D. Help an agent or broker sell insurance
Which of the following is NOT considered a definition of risk?
A. The potential of loss
B. The cause of loss
C. Exposure to danger
K
D. Uncertainty - ANS B. The cause of loss
8. A life insurance policy where the insured can choose where the cash value can be invested is
C
called:
A. whole life
LO
B. variable life
C. modified life
D. universal life - ANS B. variable life
9. Which of the following is NOT a requirement of a contract?
YC
A. Parties involved must be competent
B. Equal consideration is required between the involved parties
C. Contract must have a legal purpose
D. Offer and acceptance must be involved - ANS B. Equal consideration is required between
the involved parties
D
10. A representation may be altered or withdrawn:
U
A. anytime with the applicant's initials
B. anytime with the insurer's approval
C. only before the insurance is in effect
ST
D. only after the policy has been issued - ANS C. only before the insurance is in effect
11. According to the California Insurance Code, what is the maximum penalty per violation for
anyone who unwilfully commits an unfair method of competition?
A. $1,000
B. $5,000
C. $7,000
D. $10,000 - ANS B. $5,000
, 12. Tim was recently terminated from his employment and opted to change his existing group
term life insurance to individual permanent life insurance. What is this process called?
A. Replacement
B. Conversion
C. Transformation
D. Reinstatement - ANS B. Conversion
13. Which of the following describes a contributory group insurance plan?
K
A. All of the premium is paid by the employer
B. Part of the premium is paid by the employee
C. Employees are eligible for policy dividends
C
D. Federal government contributes a portion of the employee's premium - ANS B. Part of the
premium is paid by the employee
LO
14. Which of the following acts is NOT a Federal offense committed by an insurance agent?
A. Embezzlement
B. Insurance fraud
C. Misrepresentation on an insurance application
YC
D. Falsify records - ANS C. Misrepresentation on an insurance application
15. Dorian exercised a nonforfeiture option by using his life policy's cash value to purchase an
extended term insurance option. When the term insurance expires,
A. he has the option of resuming the original policy and paying the same premium
D
B. the coverage can be extended with a lump sum payment
C. all remaining cash values are paid to the policyowner
D. the protection ends - ANS D. the protection ends
U
16. The California Insurance Code defines "policy" as a(n):
ST
A. accepted offer
B. promissory arrangement
C. written contract
D. written quotation - ANS C. written contract
17. Which policy provision protects the policyowner from unintentional lapse of the contract?
A. Grace period
B. Free look period
C. Incontestability
D. Settlement options - ANS A. Grace period
