Life & Health Insurance Exam Prep
Questions and Answers Latest Version
Already Graded A
What type of insurance provides a death benefit to beneficiaries upon the insured's death?
✔✔ Life insurance
What insurance policy covers medical expenses due to illness or injury?
✔✔ Health insurance
What is the term for the amount the insured must pay out of pocket before the insurance
company starts to pay?
✔✔ Deductible
What type of life insurance policy builds cash value over time?
✔✔ Whole life insurance
Which insurance document outlines the terms, conditions, and benefits of a policy?
✔✔ Policy contract
1
,What is the process called when an insurer assesses risk before issuing a policy?
✔✔ Underwriting
What term describes the person who receives the death benefit from a life insurance policy?
✔✔ Beneficiary
What type of policy provides coverage for a specified period and pays a benefit only if death
occurs during that time?
✔✔ Term life insurance
What is the period after the premium due date during which coverage remains in force despite
nonpayment?
✔✔ Grace period
Which clause prevents the insured from collecting benefits for a loss caused intentionally by
themselves?
✔✔ Suicide clause
2
,What type of health insurance plan requires members to use a network of providers and get
referrals for specialists?
✔✔ Health Maintenance Organization (HMO)
What does the acronym COBRA stand for in health insurance?
✔✔ Consolidated Omnibus Budget Reconciliation Act
What is the maximum amount an insurance company will pay for a covered loss called?
✔✔ Policy limit
What term refers to the insurance company's promise to pay benefits as stated in the policy?
✔✔ Insuring clause
What is the concept of spreading risk among many policyholders to reduce financial loss called?
✔✔ Risk pooling
3
, What is the legal principle that the insured must act honestly and disclose all material facts
called?
✔✔ Utmost good faith
What type of health insurance policy pays a fixed daily amount during hospitalization regardless
of actual expenses?
✔✔ Indemnity policy
Which rider allows an insured to increase life insurance coverage without additional evidence of
insurability?
✔✔ Guaranteed insurability rider
What term describes the ongoing payment the insured makes to keep an insurance policy active?
✔✔ Premium
What kind of policy pays dividends to policyholders but does not guarantee them?
✔✔ Participating policy
4
Questions and Answers Latest Version
Already Graded A
What type of insurance provides a death benefit to beneficiaries upon the insured's death?
✔✔ Life insurance
What insurance policy covers medical expenses due to illness or injury?
✔✔ Health insurance
What is the term for the amount the insured must pay out of pocket before the insurance
company starts to pay?
✔✔ Deductible
What type of life insurance policy builds cash value over time?
✔✔ Whole life insurance
Which insurance document outlines the terms, conditions, and benefits of a policy?
✔✔ Policy contract
1
,What is the process called when an insurer assesses risk before issuing a policy?
✔✔ Underwriting
What term describes the person who receives the death benefit from a life insurance policy?
✔✔ Beneficiary
What type of policy provides coverage for a specified period and pays a benefit only if death
occurs during that time?
✔✔ Term life insurance
What is the period after the premium due date during which coverage remains in force despite
nonpayment?
✔✔ Grace period
Which clause prevents the insured from collecting benefits for a loss caused intentionally by
themselves?
✔✔ Suicide clause
2
,What type of health insurance plan requires members to use a network of providers and get
referrals for specialists?
✔✔ Health Maintenance Organization (HMO)
What does the acronym COBRA stand for in health insurance?
✔✔ Consolidated Omnibus Budget Reconciliation Act
What is the maximum amount an insurance company will pay for a covered loss called?
✔✔ Policy limit
What term refers to the insurance company's promise to pay benefits as stated in the policy?
✔✔ Insuring clause
What is the concept of spreading risk among many policyholders to reduce financial loss called?
✔✔ Risk pooling
3
, What is the legal principle that the insured must act honestly and disclose all material facts
called?
✔✔ Utmost good faith
What type of health insurance policy pays a fixed daily amount during hospitalization regardless
of actual expenses?
✔✔ Indemnity policy
Which rider allows an insured to increase life insurance coverage without additional evidence of
insurability?
✔✔ Guaranteed insurability rider
What term describes the ongoing payment the insured makes to keep an insurance policy active?
✔✔ Premium
What kind of policy pays dividends to policyholders but does not guarantee them?
✔✔ Participating policy
4
