TEXAS LIFE, ACCIDENT AND HEALTH STATE 2024 / 2025 EXAM QUESTIONS WITH SOLVED ANSWERS.

TEXAS LIFE, ACCIDENT AND HEALTH STATE 2024/2025
EXAM QUESTIONS WITH SOLVED ANSWERS.


1) What is the advantage of a Waiver of Premium provision in a life policy? -- Answer
t t t t t t t t t t t t t t t t




✔✔ Waive an insured's premiums if he/she becomes disabled.
t t t t t t t t




If an insured becomes totally disabled before a certain age, this provision would
t t t t t t t t t t t t t




waive the premiums. t t




2) What is the grace period for life insurance policies in Texas? -- Answer ✔✔ 31 days
t t t t t t t t t t t t t t t




3) Comprehensive major medical health policies typically have an Eligible Expenses t t t t t t t t t t




provision that specifies coverage for all but: -- Answer ✔✔ Experimental services
t t t t t t t t t t t




Experimental and investigative services are not normally considered eligible t t t t t t t t t




expenses..

4) In the state of Texas, when must newborn child coverage begin? -- Answer ✔✔ From
t t t t t t t t t t t t t t t




the moment of birth
t t t




Newborns must be covered from the moment of birth. t t t t t t t t




5) What part of the policy directs the insurer on the recipients of benefits? -- Answer
t t t t t t t t t t t t t t t




✔✔ Payment of Claims provision
t t t t




The Payment of Claims provision stipulates to whom claim payments are made.
t t t t t t t t t t t




6) Life insurance death benefits that can be accessed tax-free when the insured is still
t t t t t t t t t t t t t t




alive are called: -- Answer ✔✔ Accelerated benefits
t t t t t t t

, Accelerated benefits allow policyowners to use a policy's death benefits tax-free t t t t t t t t t t t




while they are still alive, or if they are terminally or chronically ill.
t t t t t t t t t t t t




7) How are dividends treated for tax purposes? -- Answer ✔✔ Never taxed
t t t t t t t t t t t




Dividends are never taxed. They are considered a return of premiums. t t t t t t t t t t




8) The life insurance rider that pays the face amount plus the total premiums paid into
t t t t t t t t t t t t t t t




the policy is known as: -- Answer ✔✔ Return of premium
t t t t t t t t t t




The return of premium rider pays the total amount of premiums paid into the
t t t t t t t t t t t t t t




policy as long as the insured dies within a certain time period specified in the policy.
t t t t t t t t t t t t t t t t




The death benefit is comprised of the face amount plus the total premiums paid into
t t t t t t t t t t t t t t




the policy.
t t




9) What is the biggest source of information used in underwriting? -- Answer ✔✔
t t t t t t t t t t t t t




Application

The application is the biggest source of information used in underwriting.
t t t t t t t t t t




10) If the cash values of an annuity are invested in securities, it is a: -- Answer ✔✔ Variable
t t t t t t t t t t t t t t t t t




t annuity

11) In Texas, life insurance policies have a grace period of 31 days or one month.
t t t t t t t t t t t t t t




Jeff and Mike own an architect firm with 20 employees and worry about the
t t t t t t t t t t t t t t




company if one of them becomes permanently disabled. What type of policy should
t t t t t t t t t t t t t




they buy? -- Answer ✔✔ Disability Buy-Out
t t t t t t




They should buy a disability buy-out policy.
t t t t t t




12) Over-funded life insurance policies where the proceeds are subject to taxation are t t t t t t t t t t t t




called: -- Answer ✔✔ MECs (Modified Endowment Contracts)
t t t t t t t




Modified endowment contracts are over-funded life insurance policies in which
t t t t t t t t t t




proceeds are subject to taxation. t t t t