XCEL TEST LIFE & HEALTH EXAM 2025
QUESTIONS AND ANSWERS
A policy that becomes a Modified Endowment Contract (MEC): - ANS will loose many of its
tax advantages
All of these are characteristics of an Adjustable Life policy, EXCEPT: - ANS face amount can be
adjusted using policy dividends
The most important factor to consider when determining whether to convert term insurance at
the insured's attained age or the insured's original age is: - ANS the cost
F needs life insurance that provides coverage for only a limited amount of time with a death
benefit that changes regularly according to a schedule. What kind of policy is needed? -
ANS Decreasing term policy
Under a Renewable Term policy, - ANS the renewal premium is calculated on the basis of the
insured's attained age
A potential client, age 40, would like to purchase a Whole Life policy that will accumulate cash
value at a faster rate in the early years of the policy. Which of these statements made by the
producer would be correct? - ANS 20-Pay Life accumulates cash value faster than Straight
Life
Which of these statements describe a Modified Endowment Contract (MEC)? - ANS Falls
below the minimum amount of premium that can be paid into a policy and still have it
recognized as a life insurance contract
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, What type of life insurance are credit policies issued as? - ANS Term
M purchases a $70,000 Life Insurance Policy with premium payments of $550 a year for the first
5 years. At the beginning of the sixth year, the premium will increase to $800 per year but will
remain level thereafter. The face amount will remain at $70,000 throughout the life of the
policy. The type of policy that M has purchased is: - ANS Modified Premiums Life
A father who dies within 3 years after purchasing a life insurance policy on his infant daughter
can have the policy premiums waived under which provision - ANS Payor provision
What type of insurance offers permanent life coverage with premiums that are payable for life?
- ANS Whole Life
Which of these types of life insurance allows the policyowner to have level premiums and to
also choose from a selection of investment options? - ANS Variable Life
How long does the coverage normally remain on a limited-pay life policy? - ANS Age 100
Term insurance has which of the following characteristics? - ANS Expires at the end of the
policy
A life insurance policy that provides a policyowner with cash value along with a level face
amount is called: - ANS Whole Life
When applied to Whole Life insurance, the word "straight" denotes: - ANS The duration of
premium payments
When is the face amount of a Whole Life policy paid? - ANS When the insured dies or at the
policy's maturity date, whichever happens first
2|P a g e C o p y r i g h t © 2 0 2 5 T H E B R I G H T A L L R I G H T S R E S E R V E D
QUESTIONS AND ANSWERS
A policy that becomes a Modified Endowment Contract (MEC): - ANS will loose many of its
tax advantages
All of these are characteristics of an Adjustable Life policy, EXCEPT: - ANS face amount can be
adjusted using policy dividends
The most important factor to consider when determining whether to convert term insurance at
the insured's attained age or the insured's original age is: - ANS the cost
F needs life insurance that provides coverage for only a limited amount of time with a death
benefit that changes regularly according to a schedule. What kind of policy is needed? -
ANS Decreasing term policy
Under a Renewable Term policy, - ANS the renewal premium is calculated on the basis of the
insured's attained age
A potential client, age 40, would like to purchase a Whole Life policy that will accumulate cash
value at a faster rate in the early years of the policy. Which of these statements made by the
producer would be correct? - ANS 20-Pay Life accumulates cash value faster than Straight
Life
Which of these statements describe a Modified Endowment Contract (MEC)? - ANS Falls
below the minimum amount of premium that can be paid into a policy and still have it
recognized as a life insurance contract
1|P a g e C o p y r i g h t © 2 0 2 5 T H E B R I G H T A L L R I G H T S R E S E R V E D
, What type of life insurance are credit policies issued as? - ANS Term
M purchases a $70,000 Life Insurance Policy with premium payments of $550 a year for the first
5 years. At the beginning of the sixth year, the premium will increase to $800 per year but will
remain level thereafter. The face amount will remain at $70,000 throughout the life of the
policy. The type of policy that M has purchased is: - ANS Modified Premiums Life
A father who dies within 3 years after purchasing a life insurance policy on his infant daughter
can have the policy premiums waived under which provision - ANS Payor provision
What type of insurance offers permanent life coverage with premiums that are payable for life?
- ANS Whole Life
Which of these types of life insurance allows the policyowner to have level premiums and to
also choose from a selection of investment options? - ANS Variable Life
How long does the coverage normally remain on a limited-pay life policy? - ANS Age 100
Term insurance has which of the following characteristics? - ANS Expires at the end of the
policy
A life insurance policy that provides a policyowner with cash value along with a level face
amount is called: - ANS Whole Life
When applied to Whole Life insurance, the word "straight" denotes: - ANS The duration of
premium payments
When is the face amount of a Whole Life policy paid? - ANS When the insured dies or at the
policy's maturity date, whichever happens first
2|P a g e C o p y r i g h t © 2 0 2 5 T H E B R I G H T A L L R I G H T S R E S E R V E D
