XCEL Solutions Life and Health License Exam
(CA) Questions & Answers
1.A saving vehicle designed to first accumulate funds and then
systematically liquidates the funds
Answer Deferred annuity
2.An annuity which is backed by a life insurer's separate account
Answer Variable Annuity
3.Cindy buys a 10-year certain annuity with an installment refund. After
receiv- ing monthly payments for 5 years, Cindy dies. How many remaining
payments will the insurer make to her beneficiary?
Answer 60 payments
4.An annuitant would like to determine the current value of her annuity. To
do this, she multiplies the number of "accumulation units" she owns times
the unit value of the "separate account". What kind of annuity BEST
matches this description?
Answer Variable Annuity
5.An annuitant would like to determine the amount of an annuity
distribution that is exempt from taxation. What is used to calculate this?
Answer Exclusion Ratio
,6.What is a common reason people purchase an annuity?
Answer To protect against the risk of outliving their financial resources
7.Which of the following is NOT a feature of equity annuities?
Answer Offers a maxi- mum interest rate that increases annually
8.When a mutual insurer becomes a stock company, the process is called
Answer -
Demutualization
9.An insurer owned by its policyholder is called a
Answer Mutual insurer
10.Which of the following statements regarding a life insurance policy divi-
dend is TRUE?
Answer It is the distribution of excess of funds accumulated by the
insurer on participating policies
11.Which of the following is a type of insurance where an insurer
transfers loss exposure from policies written for its insureds?
Answer Reinsurance
12.AAA Insurance Company has transferred a portion of its loss
exposure to BBB Insurance Company. In this reinsurance transaction,
,what is AAA Insurance Company called?
Answer Primary Insurer
13.John owns an insurance policy that gives him the right to share in
the insurer's surplus. What kind of policy is this?
Answer Participating
14.Kim is insured under a disability income insurance policy with an "own-
oc- cupation" clause. She was recently injured in an automobile accident
and can no longer perform the task of her job. Kim is no considered to be
Answer totally disabled
15.What are residual disability income insurance payments based on?
Answer The amount of the insured's income is reduced by the disability
16.Dyan is considered partially disabled by her insurance company.
Which of the following BEST describes her situation?
Answer She is working part-time and receiving lost income under her
long-term disability benefit
17.Under a disability income insurance policy, which criteria must be met
for "bodily injury" tp be classified as accidental?
Answer The cause may be intentional, but the result must be accidental
, 18.The elimination period in a disability income policy serves the same pur-
pose
Answer a deductible
19.Which of the following is NOT a provision in a disability income policy
Answer -
Deductible and coinsurance provision
20.Allen has a disability income policy with a $2,500 monthly benefit and a
30-day elimination period. He is unable to work 90 days following an
automo- bile accident. What will the policy pay?
Answer $5,000 (90 days - 30 days = 60 days or 2 months) 2 months x
$2,500
21.The problem of over-insurance is addressed in which health
insurance provision
Answer Coordination of benefits
22.When a claimant has coverage under more than one health plan,
which group medical plan provision applies?
Answer Coordination of benefits
23.The Consolidated Omnibus Budget Reconciliation Act (COBRA) applies
to employers who employ at least
Answer 20 employees
(CA) Questions & Answers
1.A saving vehicle designed to first accumulate funds and then
systematically liquidates the funds
Answer Deferred annuity
2.An annuity which is backed by a life insurer's separate account
Answer Variable Annuity
3.Cindy buys a 10-year certain annuity with an installment refund. After
receiv- ing monthly payments for 5 years, Cindy dies. How many remaining
payments will the insurer make to her beneficiary?
Answer 60 payments
4.An annuitant would like to determine the current value of her annuity. To
do this, she multiplies the number of "accumulation units" she owns times
the unit value of the "separate account". What kind of annuity BEST
matches this description?
Answer Variable Annuity
5.An annuitant would like to determine the amount of an annuity
distribution that is exempt from taxation. What is used to calculate this?
Answer Exclusion Ratio
,6.What is a common reason people purchase an annuity?
Answer To protect against the risk of outliving their financial resources
7.Which of the following is NOT a feature of equity annuities?
Answer Offers a maxi- mum interest rate that increases annually
8.When a mutual insurer becomes a stock company, the process is called
Answer -
Demutualization
9.An insurer owned by its policyholder is called a
Answer Mutual insurer
10.Which of the following statements regarding a life insurance policy divi-
dend is TRUE?
Answer It is the distribution of excess of funds accumulated by the
insurer on participating policies
11.Which of the following is a type of insurance where an insurer
transfers loss exposure from policies written for its insureds?
Answer Reinsurance
12.AAA Insurance Company has transferred a portion of its loss
exposure to BBB Insurance Company. In this reinsurance transaction,
,what is AAA Insurance Company called?
Answer Primary Insurer
13.John owns an insurance policy that gives him the right to share in
the insurer's surplus. What kind of policy is this?
Answer Participating
14.Kim is insured under a disability income insurance policy with an "own-
oc- cupation" clause. She was recently injured in an automobile accident
and can no longer perform the task of her job. Kim is no considered to be
Answer totally disabled
15.What are residual disability income insurance payments based on?
Answer The amount of the insured's income is reduced by the disability
16.Dyan is considered partially disabled by her insurance company.
Which of the following BEST describes her situation?
Answer She is working part-time and receiving lost income under her
long-term disability benefit
17.Under a disability income insurance policy, which criteria must be met
for "bodily injury" tp be classified as accidental?
Answer The cause may be intentional, but the result must be accidental
, 18.The elimination period in a disability income policy serves the same pur-
pose
Answer a deductible
19.Which of the following is NOT a provision in a disability income policy
Answer -
Deductible and coinsurance provision
20.Allen has a disability income policy with a $2,500 monthly benefit and a
30-day elimination period. He is unable to work 90 days following an
automo- bile accident. What will the policy pay?
Answer $5,000 (90 days - 30 days = 60 days or 2 months) 2 months x
$2,500
21.The problem of over-insurance is addressed in which health
insurance provision
Answer Coordination of benefits
22.When a claimant has coverage under more than one health plan,
which group medical plan provision applies?
Answer Coordination of benefits
23.The Consolidated Omnibus Budget Reconciliation Act (COBRA) applies
to employers who employ at least
Answer 20 employees
