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ALABAMA INSURANCE TEST 2025
QUESTIONS AND ANSWERS.
1. Julio, the insurance producer, has allowed his license to lapse. He would
like to reinstate his license without retaking a prelicense course or
passing a written examination. To do this, Julio must reinstate the
license within ___ months from the renewal date. - correct answer - 12
2. An insurance producer who offers a potential client something of value
as an incentive to purchase insurance is engaging in: - correct answer -
rebating
3. Carol is a life insurance policyowner who has transferred her ownership
to a third party in exchange for a percentage of the death benefit. What
is this called? - correct answer - Viatical settlement agreement
4. In Alabama, when are newborns covered under a health policy? -
correct answer - The moment of birth
5. Which of the following is a TRUE statement regarding dental insurance?
- correct answer - Comprehensive dental care policies usually cover a
percentage of reasonable and customary charges for non-routine
treatment
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6. What use does a business have for a key employee disability insurance
policy? - correct answer - Temporarily replace a disabled key employee
7. The period of time during which a surviving spouse does not qualify for
Social Security survivor or retirement benefits is called: - correct answer
- The Blackout Period
8. Required Provision 3 states that the minimum grace period for all
policies (except those with monthly or weekly premium modes) is: -
correct answer - 31 days
9. Which statement concerning Alabama's life insurance solicitation
regulations is true? - correct answer - All of these
10. Which of the following dividend options allows the continuation of
cash value accumulation? - correct answer - Reduced paid-up insurance
11. Medicare eligibility is typically based on: - correct answer - age
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12. What is vesting? - correct answer - The employee's right to the
employer's contributions in a retirement plan if employment terminates
prior to retirement
13. Katherine is a retiree and was recently hospitalized for 10 days.
Which type of insurance policy would best cover her for excess hospital
expenses? - correct answer -
14. What kind of risk are amateur pilots normally classified as? - correct
answer - Special class risks
15. What does Disability Buy-Sell insurance provide? - correct answer -
lump-sum benefits
16. When medical expenses reach a certain dollar amount, the insured is
no longer responsible for sharing the cost of expenses. The insurance
company then pays 100% of the covered expenses. This major medical
policy provision is called a(n): - correct answer - stop-loss limit
17. Which of the following statements is NOT correct? - correct answer -
Agents are allowed to waive certain policy provisions
ALABAMA INSURANCE TEST 2025
QUESTIONS AND ANSWERS.
1. Julio, the insurance producer, has allowed his license to lapse. He would
like to reinstate his license without retaking a prelicense course or
passing a written examination. To do this, Julio must reinstate the
license within ___ months from the renewal date. - correct answer - 12
2. An insurance producer who offers a potential client something of value
as an incentive to purchase insurance is engaging in: - correct answer -
rebating
3. Carol is a life insurance policyowner who has transferred her ownership
to a third party in exchange for a percentage of the death benefit. What
is this called? - correct answer - Viatical settlement agreement
4. In Alabama, when are newborns covered under a health policy? -
correct answer - The moment of birth
5. Which of the following is a TRUE statement regarding dental insurance?
- correct answer - Comprehensive dental care policies usually cover a
percentage of reasonable and customary charges for non-routine
treatment
, Page |2
6. What use does a business have for a key employee disability insurance
policy? - correct answer - Temporarily replace a disabled key employee
7. The period of time during which a surviving spouse does not qualify for
Social Security survivor or retirement benefits is called: - correct answer
- The Blackout Period
8. Required Provision 3 states that the minimum grace period for all
policies (except those with monthly or weekly premium modes) is: -
correct answer - 31 days
9. Which statement concerning Alabama's life insurance solicitation
regulations is true? - correct answer - All of these
10. Which of the following dividend options allows the continuation of
cash value accumulation? - correct answer - Reduced paid-up insurance
11. Medicare eligibility is typically based on: - correct answer - age
, Page |3
12. What is vesting? - correct answer - The employee's right to the
employer's contributions in a retirement plan if employment terminates
prior to retirement
13. Katherine is a retiree and was recently hospitalized for 10 days.
Which type of insurance policy would best cover her for excess hospital
expenses? - correct answer -
14. What kind of risk are amateur pilots normally classified as? - correct
answer - Special class risks
15. What does Disability Buy-Sell insurance provide? - correct answer -
lump-sum benefits
16. When medical expenses reach a certain dollar amount, the insured is
no longer responsible for sharing the cost of expenses. The insurance
company then pays 100% of the covered expenses. This major medical
policy provision is called a(n): - correct answer - stop-loss limit
17. Which of the following statements is NOT correct? - correct answer -
Agents are allowed to waive certain policy provisions
