ARKANSAS LIFE INSURANCE
Arkansas Life Insurance Exam Complete
Questions and Answers 2025 Graded A+
J is a producer who has induced an insured through misrepresentation to surrender an
existing insurance policy. What is J guilty of? -Correct Answer ✔Twisting
What is implied authority defined as? -Correct Answer ✔Authority that is not specifically
given to an agent contract, but that an agent can reasonably assume to carry out his/her
duties
A person who is a nonsmoker, average weight, excellent health would fall into what risk
classification? -Correct Answer ✔Preferred
Which of the following is considered to be the period when the accumulated value in an
annuity is paid out? -Correct Answer ✔Annuitization phase
An insurers claim settlement practices are regulated by the: -Correct Answer ✔State
insurance departments
An insurers ability to make unpredictable payouts to policy owners is called: -Correct
Answer ✔Liquidity
Which of the following pertains to the analysis of an applicants personal information and
determining whether insurance should be issued or declined? -Correct Answer
✔Underwriting
What does the Group Life underwriting risk selection process help protect insurance
companies from? -Correct Answer ✔Adverse Selection
The Arkansas Life & Disability Insurance Guaranty Association assures payment of
benefits from insurance policies for insolvent insurers, and covers all of the following
insured policies, EXCEPT: -Correct Answer ✔Liability Insurance
What would happen if a life insurance applicant is given a conditional receipt from an
insurance agent and then dies the next day? -Correct Answer ✔Claim will be paid if
application is approved
A life insurance policy owner does NOT have the right to: -Correct Answer ✔Revoke an
absolute assignment
An employee under a group insurance policy has the right to name a beneficiary and
the right to: -Correct Answer ✔Convert to an individual policy in the event of
employment termination
ARKANSAS LIFE INSURANCE
,ARKANSAS LIFE INSURANCE
The two major actions required for a policyholder to comply with the Reinstatement
Clause are -Correct Answer ✔Provide evidence of insurability, past due premiums
Pat owns a 20-pay life policy with a paid-up dividend option. Which of the following
statements is true? -Correct Answer ✔The policy may be paid up early by using policy
dividends
Ron has a life insurance policy with a face value of $100,000 and a cost of living rider. If
the consumer price index has gone up 4%, how much may Ron increase the face value
of the policy? -Correct Answer ✔$4,000
($100,000 X .04 = $4,000)
Krissa purchases a 10-year level term life insurance policy that has a death benefit of
$200,000. Which of these statements is true? -Correct Answer ✔The face amount and
premium will remain constant over the 10-year period
What is Arkansas' REQUIRED grace period for a life insurance contract? -Correct
Answer ✔31 days
A domestic insurance company in Arkansas MUST -Correct Answer ✔Be organized
under Arkansas Insurance laws
Simon has purchased a fixed immediate annuity. His payment amount will be
dependent upon principal, interest, and the contract's -Correct Answer ✔Income period
What kind of life insurance policy issued by a mutual insurer provides a return of
divisible surplus? -Correct Answer ✔Participating life insurance policy
No one is allowed to act as a producer for any insurance company in Arkansas that -
Correct Answer ✔Is unauthorized to do business in Arkansas
What MUST the company do prior to conducting an HIV related test? -Correct Answer
✔Obtain a written consent from the proposed insured
Which approach predicts a person's earning potential and determines how much of that
amount would be devoted to dependents? -Correct Answer ✔Human life value
approach
If the annuitant dies before the annuity start date, -Correct Answer ✔The premiums paid
plus interest earned will be given to the beneficiary
ARKANSAS LIFE INSURANCE
, ARKANSAS LIFE INSURANCE
If dividends are illustrated, the advertisement MUST state that the dividends are: -
Correct Answer ✔Not guaranteed
Intentional withholding of material facts that would affect an insurance policy's validity is
called a(n) -Correct Answer ✔Concealment
Field underwriting performed by the producer involves -Correct Answer ✔Completing
the application and collecting initial premium
Which of the following statements is CORRECT regarding an individual applying for life
or health insurance? -Correct Answer ✔The applicants medical history may be analyzed
and reported
Life insurance policies will normally pay for losses arising from -Correct Answer
✔Commercial aviation
An example of rebating would be -Correct Answer ✔Offering a client something of value
not stated in the contract in exchange for their business
Which type of insurance company allows their policyowners to elect governing body? -
Correct Answer ✔Mutual
Which type of life insurance policy pays the face amount at the end of the specified
period if the insured is still alive? -Correct Answer ✔Endowment policy
A life insurance claim which involves a per capita distribution of policy proceeds would
be payable to the -Correct Answer ✔Named living primary beneficiaries
A type of group that has a constitution and bylaws and has been organized for purposes
other than obtaining insurance is called a(n) -Correct Answer ✔Association or labor
group
What are an applicant's statements concerning occupation, hobbies, and personal
health history regarded as? -Correct Answer ✔Representation
Ken is a producer who has obtained Consumer Information Reports under false
pretenses. Under the Fair Credit Reporting Act, what is the maximum penalty that may
be imposed on Ken? -Correct Answer ✔$5,000
The _________ must provide an insured with proper disclosure concerning the
replacement of a life insurance policy -Correct Answer ✔Producer
Within how many days must a rollover be completed in order to avoid being taxed as
current income? -Correct Answer ✔60 days to complete the rollover to another IRA
ARKANSAS LIFE INSURANCE
Arkansas Life Insurance Exam Complete
Questions and Answers 2025 Graded A+
J is a producer who has induced an insured through misrepresentation to surrender an
existing insurance policy. What is J guilty of? -Correct Answer ✔Twisting
What is implied authority defined as? -Correct Answer ✔Authority that is not specifically
given to an agent contract, but that an agent can reasonably assume to carry out his/her
duties
A person who is a nonsmoker, average weight, excellent health would fall into what risk
classification? -Correct Answer ✔Preferred
Which of the following is considered to be the period when the accumulated value in an
annuity is paid out? -Correct Answer ✔Annuitization phase
An insurers claim settlement practices are regulated by the: -Correct Answer ✔State
insurance departments
An insurers ability to make unpredictable payouts to policy owners is called: -Correct
Answer ✔Liquidity
Which of the following pertains to the analysis of an applicants personal information and
determining whether insurance should be issued or declined? -Correct Answer
✔Underwriting
What does the Group Life underwriting risk selection process help protect insurance
companies from? -Correct Answer ✔Adverse Selection
The Arkansas Life & Disability Insurance Guaranty Association assures payment of
benefits from insurance policies for insolvent insurers, and covers all of the following
insured policies, EXCEPT: -Correct Answer ✔Liability Insurance
What would happen if a life insurance applicant is given a conditional receipt from an
insurance agent and then dies the next day? -Correct Answer ✔Claim will be paid if
application is approved
A life insurance policy owner does NOT have the right to: -Correct Answer ✔Revoke an
absolute assignment
An employee under a group insurance policy has the right to name a beneficiary and
the right to: -Correct Answer ✔Convert to an individual policy in the event of
employment termination
ARKANSAS LIFE INSURANCE
,ARKANSAS LIFE INSURANCE
The two major actions required for a policyholder to comply with the Reinstatement
Clause are -Correct Answer ✔Provide evidence of insurability, past due premiums
Pat owns a 20-pay life policy with a paid-up dividend option. Which of the following
statements is true? -Correct Answer ✔The policy may be paid up early by using policy
dividends
Ron has a life insurance policy with a face value of $100,000 and a cost of living rider. If
the consumer price index has gone up 4%, how much may Ron increase the face value
of the policy? -Correct Answer ✔$4,000
($100,000 X .04 = $4,000)
Krissa purchases a 10-year level term life insurance policy that has a death benefit of
$200,000. Which of these statements is true? -Correct Answer ✔The face amount and
premium will remain constant over the 10-year period
What is Arkansas' REQUIRED grace period for a life insurance contract? -Correct
Answer ✔31 days
A domestic insurance company in Arkansas MUST -Correct Answer ✔Be organized
under Arkansas Insurance laws
Simon has purchased a fixed immediate annuity. His payment amount will be
dependent upon principal, interest, and the contract's -Correct Answer ✔Income period
What kind of life insurance policy issued by a mutual insurer provides a return of
divisible surplus? -Correct Answer ✔Participating life insurance policy
No one is allowed to act as a producer for any insurance company in Arkansas that -
Correct Answer ✔Is unauthorized to do business in Arkansas
What MUST the company do prior to conducting an HIV related test? -Correct Answer
✔Obtain a written consent from the proposed insured
Which approach predicts a person's earning potential and determines how much of that
amount would be devoted to dependents? -Correct Answer ✔Human life value
approach
If the annuitant dies before the annuity start date, -Correct Answer ✔The premiums paid
plus interest earned will be given to the beneficiary
ARKANSAS LIFE INSURANCE
, ARKANSAS LIFE INSURANCE
If dividends are illustrated, the advertisement MUST state that the dividends are: -
Correct Answer ✔Not guaranteed
Intentional withholding of material facts that would affect an insurance policy's validity is
called a(n) -Correct Answer ✔Concealment
Field underwriting performed by the producer involves -Correct Answer ✔Completing
the application and collecting initial premium
Which of the following statements is CORRECT regarding an individual applying for life
or health insurance? -Correct Answer ✔The applicants medical history may be analyzed
and reported
Life insurance policies will normally pay for losses arising from -Correct Answer
✔Commercial aviation
An example of rebating would be -Correct Answer ✔Offering a client something of value
not stated in the contract in exchange for their business
Which type of insurance company allows their policyowners to elect governing body? -
Correct Answer ✔Mutual
Which type of life insurance policy pays the face amount at the end of the specified
period if the insured is still alive? -Correct Answer ✔Endowment policy
A life insurance claim which involves a per capita distribution of policy proceeds would
be payable to the -Correct Answer ✔Named living primary beneficiaries
A type of group that has a constitution and bylaws and has been organized for purposes
other than obtaining insurance is called a(n) -Correct Answer ✔Association or labor
group
What are an applicant's statements concerning occupation, hobbies, and personal
health history regarded as? -Correct Answer ✔Representation
Ken is a producer who has obtained Consumer Information Reports under false
pretenses. Under the Fair Credit Reporting Act, what is the maximum penalty that may
be imposed on Ken? -Correct Answer ✔$5,000
The _________ must provide an insured with proper disclosure concerning the
replacement of a life insurance policy -Correct Answer ✔Producer
Within how many days must a rollover be completed in order to avoid being taxed as
current income? -Correct Answer ✔60 days to complete the rollover to another IRA
ARKANSAS LIFE INSURANCE
