PRIMERICA LIFE INSURANCE EXAMINATION TEST
2025/2026 QUESTIONS WITH ANSWERS RATED A+
✔✔All of the following are duties and responsibilities of producers at the time of
application EXCEPT
A) Change any incorrect statement on the application by personally initialing next to the
corrected statement.
B) Explain the nature and type of any receipt the producer is giving to the applicant
C) Probe beyond the stated questions if the producer feels the applicant is
misrepresenting or concealing information.
D) Check to make sure that there are no unanswered questions on the application -
✔✔Change any incorrect statement on the application by personally initialing next to the
corrected statement.
✔✔According to the nonforfeiture law, if the owner decides to surrender a deferred
annuity prior to annuitization, the owner is entitled to which of the following>
A) Guaranteed Surrender Value
B) No Payments
C) Annuity Dividends
D) Full premium refund without any changes - ✔✔Guaranteed Surrender Value
✔✔Which law is the foundation of the statistical prediction of loss upon which rates for
insurance are calculated?
A) Law of Masses
B) Law of Averages
C) Law of Group Evaluation
D) Law of Large Numbers - ✔✔Law of Large Numbers
✔✔When the insured selects the extended term nonforfeiture option, the cash value will
be used to purchase term insurance with what face amount?
a) The same as the original policy minus the cash value
b) Equal to the original policy for as long as the cash values will purchase.
c)In lesser amounts for the remaining policy term of age 100.
d)Equal to the cash value surrendered from the policy - ✔✔Equal to the original policy
for as long as the cash values will purchase:
With this option, the cash value is used as a single premium to purchase the same face
amount as the original policy for as long a period of time as the cash will buy at the
insured's current age.
✔✔Your client wants both protection and savings from the insurance and is willing to
pay premiums until retirement at age 65. What would be the right policy for this client?
a) Interest-sensitive whole life
b)Life annuity with period certain
c)Increasing term
,d)Limited pay whole life - ✔✔Limited pay whole life:
Premium payments will cease at her age 65, but coverage will continue to her death or
age 100.
✔✔An applicant wants to buy a policy that has a cash value element. Which type should
she buy?
a) Term
b) Permanent
c)Stock
d)Investment - ✔✔Permanent:
Unlike term insurance, permanent insurance provides lifetime death protection and a
savings or cash value option.
✔✔Because an agent is using stationery with the logo of an insurance company,
applicants for insurance assume that the agent is authorized to transact on behalf of
that insurer. What type of agent authority does this describe?
A) Assumed
b) Apparent
c)Express
d)Implied - ✔✔Apparent:
Apparent authority (also known as perceived authority) is the appearance, or the
assumption of authority based on the actions, words, or deeds of the principal or
because of circumstances the principal created.
✔✔Michigan's continuing education requirement has each of the following
characteristics EXCEPT
a) It requires satisfactory completion of at least 24 hours of approved training every
biennium.
b) Other than the 3 hours of ethics, licensees may take courses in any line.
c)It allows for up to 15 excess credit hours to be carried forward to the next reporting
period.
d)At least 3 hours must cover ethics. - ✔✔It allows for up to 15 excess credit hours to
be carried forward to the next reporting period.
Reason: Up to 12 excess credit hours of CE may be carried over to the next review
period.
✔✔An insured purchased a life insurance policy on his life naming his wife as primary
beneficiary, and his daughter as contingent beneficiary. Under what circumstances
could the daughter collect the death benefit?
a) If the primary beneficiary predeceased the insured
b) When the insured dies, the primary and contingent beneficiaries share death benefits
equally.
c)With the primary beneficiary's written consent
d)If the insured died from accidental means - ✔✔If the primary beneficiary predeceased
the insured
, Reason: The daughter, as contingent beneficiary, would need to outlive the insured and
primary beneficiary.
✔✔An insured misstates her age at the time the life insurance application is taken. This
misstatement may result in
a) Recession of the policy.
b) Adjustment in the amount of death benefit.
c)No change whatsoever.
d)Automatic lapse. - ✔✔Adjustment in the amount of death benefit
Reason: If the applicant has misstated his or her age or gender on the application, the
insurer, in the event of a claim, is allowed under this provision to adjust the benefits to
an amount that the premium at the correct age or gender would have otherwise
purchased.
✔✔If an annuitant dies before annuitization occurs, what will the beneficiary receive?
a) Either the amount paid into the plan or the cash value of the plan, whichever is the
greater amount
b) Either the amount paid into the plan or the cash value of the plan, whichever is the
lesser amount
c)Amount paid into the plan
d)Cash value of the plan - ✔✔Either the amount paid into the plan or the cash value of
the plan, whichever is the greater amount
Reason: If an annuitant dies before annuitization, the beneficiary will receive either the
amount paid into the plan or the cash value of the plan, whichever is greater.
✔✔Which of the following types of risk will result in the highest premium?
A) Substandard risk
b) Standard risk
c)Preferred risk
d)All risks pay equal premiums - ✔✔Substandard Risk
Reason: The "substandard" rating indicates that an individual represents an under-
average insurance risk because of physical condition, personal or family history of
disease, occupation, habits or hobbies. This rating incurs the highest premium if policy
is issued.
✔✔What is a definition of a unilateral contract?
a) If one party makes a condition, the other party can counteroffer.
b) One-sided: only one party makes an enforceable promise.
c)Two or more parties go into a contract understanding there may be an unequal
exchange of value.
d)One author: the company wrote the contract; the insured must accept it as written. -
✔✔One-sided: only one party makes an enforceable promise.
Reason: An insurance contract is unilateral in that only one of the parties to the contract
is legally bound to do anything.
2025/2026 QUESTIONS WITH ANSWERS RATED A+
✔✔All of the following are duties and responsibilities of producers at the time of
application EXCEPT
A) Change any incorrect statement on the application by personally initialing next to the
corrected statement.
B) Explain the nature and type of any receipt the producer is giving to the applicant
C) Probe beyond the stated questions if the producer feels the applicant is
misrepresenting or concealing information.
D) Check to make sure that there are no unanswered questions on the application -
✔✔Change any incorrect statement on the application by personally initialing next to the
corrected statement.
✔✔According to the nonforfeiture law, if the owner decides to surrender a deferred
annuity prior to annuitization, the owner is entitled to which of the following>
A) Guaranteed Surrender Value
B) No Payments
C) Annuity Dividends
D) Full premium refund without any changes - ✔✔Guaranteed Surrender Value
✔✔Which law is the foundation of the statistical prediction of loss upon which rates for
insurance are calculated?
A) Law of Masses
B) Law of Averages
C) Law of Group Evaluation
D) Law of Large Numbers - ✔✔Law of Large Numbers
✔✔When the insured selects the extended term nonforfeiture option, the cash value will
be used to purchase term insurance with what face amount?
a) The same as the original policy minus the cash value
b) Equal to the original policy for as long as the cash values will purchase.
c)In lesser amounts for the remaining policy term of age 100.
d)Equal to the cash value surrendered from the policy - ✔✔Equal to the original policy
for as long as the cash values will purchase:
With this option, the cash value is used as a single premium to purchase the same face
amount as the original policy for as long a period of time as the cash will buy at the
insured's current age.
✔✔Your client wants both protection and savings from the insurance and is willing to
pay premiums until retirement at age 65. What would be the right policy for this client?
a) Interest-sensitive whole life
b)Life annuity with period certain
c)Increasing term
,d)Limited pay whole life - ✔✔Limited pay whole life:
Premium payments will cease at her age 65, but coverage will continue to her death or
age 100.
✔✔An applicant wants to buy a policy that has a cash value element. Which type should
she buy?
a) Term
b) Permanent
c)Stock
d)Investment - ✔✔Permanent:
Unlike term insurance, permanent insurance provides lifetime death protection and a
savings or cash value option.
✔✔Because an agent is using stationery with the logo of an insurance company,
applicants for insurance assume that the agent is authorized to transact on behalf of
that insurer. What type of agent authority does this describe?
A) Assumed
b) Apparent
c)Express
d)Implied - ✔✔Apparent:
Apparent authority (also known as perceived authority) is the appearance, or the
assumption of authority based on the actions, words, or deeds of the principal or
because of circumstances the principal created.
✔✔Michigan's continuing education requirement has each of the following
characteristics EXCEPT
a) It requires satisfactory completion of at least 24 hours of approved training every
biennium.
b) Other than the 3 hours of ethics, licensees may take courses in any line.
c)It allows for up to 15 excess credit hours to be carried forward to the next reporting
period.
d)At least 3 hours must cover ethics. - ✔✔It allows for up to 15 excess credit hours to
be carried forward to the next reporting period.
Reason: Up to 12 excess credit hours of CE may be carried over to the next review
period.
✔✔An insured purchased a life insurance policy on his life naming his wife as primary
beneficiary, and his daughter as contingent beneficiary. Under what circumstances
could the daughter collect the death benefit?
a) If the primary beneficiary predeceased the insured
b) When the insured dies, the primary and contingent beneficiaries share death benefits
equally.
c)With the primary beneficiary's written consent
d)If the insured died from accidental means - ✔✔If the primary beneficiary predeceased
the insured
, Reason: The daughter, as contingent beneficiary, would need to outlive the insured and
primary beneficiary.
✔✔An insured misstates her age at the time the life insurance application is taken. This
misstatement may result in
a) Recession of the policy.
b) Adjustment in the amount of death benefit.
c)No change whatsoever.
d)Automatic lapse. - ✔✔Adjustment in the amount of death benefit
Reason: If the applicant has misstated his or her age or gender on the application, the
insurer, in the event of a claim, is allowed under this provision to adjust the benefits to
an amount that the premium at the correct age or gender would have otherwise
purchased.
✔✔If an annuitant dies before annuitization occurs, what will the beneficiary receive?
a) Either the amount paid into the plan or the cash value of the plan, whichever is the
greater amount
b) Either the amount paid into the plan or the cash value of the plan, whichever is the
lesser amount
c)Amount paid into the plan
d)Cash value of the plan - ✔✔Either the amount paid into the plan or the cash value of
the plan, whichever is the greater amount
Reason: If an annuitant dies before annuitization, the beneficiary will receive either the
amount paid into the plan or the cash value of the plan, whichever is greater.
✔✔Which of the following types of risk will result in the highest premium?
A) Substandard risk
b) Standard risk
c)Preferred risk
d)All risks pay equal premiums - ✔✔Substandard Risk
Reason: The "substandard" rating indicates that an individual represents an under-
average insurance risk because of physical condition, personal or family history of
disease, occupation, habits or hobbies. This rating incurs the highest premium if policy
is issued.
✔✔What is a definition of a unilateral contract?
a) If one party makes a condition, the other party can counteroffer.
b) One-sided: only one party makes an enforceable promise.
c)Two or more parties go into a contract understanding there may be an unequal
exchange of value.
d)One author: the company wrote the contract; the insured must accept it as written. -
✔✔One-sided: only one party makes an enforceable promise.
Reason: An insurance contract is unilateral in that only one of the parties to the contract
is legally bound to do anything.
