ExamFX Practice test UPDATED ACTUAL
Exam Questions and CORRECT Answers
A qualified plan may not favor whom? - CORRECT ANSWER - Shareholders & top
executives
The beneficiary chooses to receive the life policy proceeds in the form of monthly income at the
rate of $3,000 per month, until principal and interest are exhausted. What settlement option did
the Benny select? - CORRECT ANSWER - Fixed amount
What type of care is respite care ? - CORRECT ANSWER - Relief for the main care giver
?
a survivorship life policy insures who "similar to what other policy type" & the premium is based
on what? - CORRECT ANSWER - Insures two or more lives "like a joint life policy" and
the premium is based on a joint age
When insurers negotiate contracts with health care providers or physicians to provide health care
services to subscribers at a favorable cost its called what? - CORRECT ANSWER -
Preferred provider organization "insurers negotiate the rates for specific procedures for their
subscribers"
What type of rating system uses the actual claim of a group as a factor in developing the rates for
coverage ? - CORRECT ANSWER - Experience Rating
What is experience rating - CORRECT ANSWER - Is where premiums are determined by
the loss experience of a particular group as a whole
What does it mean when they say "life insurance creates an immediate estate"? - CORRECT
ANSWER - It means the beneficiary is immediately able to receive to policy face value in
a lump sum upon the death of the insured
, What information do consumer reports include ? - CORRECT ANSWER - Includes
information regarding a persons credit, character, reputation & habits
Rank 3 annuities from lowest to highest on the amount of monthly income they would provide. -
CORRECT ANSWER - Life with refund option , life with 10 years certain, straight life
What is required to be stated in the outline of coverage provided with a long term policy? -
CORRECT ANSWER - 1. Basic info about the company
2. Right to return the policy for a refund
3. Policy #
-basic info about supplementary policies is NOT required to be stated
What is one reason someone would purchase an annuity concerning risk? - CORRECT
ANSWER - They may believe they will outlive their retirement income
An annuity , issued by an insurance company , is the only type of investment that can guarantee
what? - CORRECT ANSWER - Guarantee a lifetime income that the annuitant cannot
outlive
Most policies will pay the accidental death benefits as long as the death is caused by the accident
and occurs within how many days ? - CORRECT ANSWER - 90 days
List 3 personal uses of life insurance & 1 circumstance that isn't a personal use of life insurance -
CORRECT ANSWER - #1 you buy life insurance to provide future income for a surviving
spouse
#2 an individual buys term insurance to help the family pay off the mortgage in case of
premature death
Exam Questions and CORRECT Answers
A qualified plan may not favor whom? - CORRECT ANSWER - Shareholders & top
executives
The beneficiary chooses to receive the life policy proceeds in the form of monthly income at the
rate of $3,000 per month, until principal and interest are exhausted. What settlement option did
the Benny select? - CORRECT ANSWER - Fixed amount
What type of care is respite care ? - CORRECT ANSWER - Relief for the main care giver
?
a survivorship life policy insures who "similar to what other policy type" & the premium is based
on what? - CORRECT ANSWER - Insures two or more lives "like a joint life policy" and
the premium is based on a joint age
When insurers negotiate contracts with health care providers or physicians to provide health care
services to subscribers at a favorable cost its called what? - CORRECT ANSWER -
Preferred provider organization "insurers negotiate the rates for specific procedures for their
subscribers"
What type of rating system uses the actual claim of a group as a factor in developing the rates for
coverage ? - CORRECT ANSWER - Experience Rating
What is experience rating - CORRECT ANSWER - Is where premiums are determined by
the loss experience of a particular group as a whole
What does it mean when they say "life insurance creates an immediate estate"? - CORRECT
ANSWER - It means the beneficiary is immediately able to receive to policy face value in
a lump sum upon the death of the insured
, What information do consumer reports include ? - CORRECT ANSWER - Includes
information regarding a persons credit, character, reputation & habits
Rank 3 annuities from lowest to highest on the amount of monthly income they would provide. -
CORRECT ANSWER - Life with refund option , life with 10 years certain, straight life
What is required to be stated in the outline of coverage provided with a long term policy? -
CORRECT ANSWER - 1. Basic info about the company
2. Right to return the policy for a refund
3. Policy #
-basic info about supplementary policies is NOT required to be stated
What is one reason someone would purchase an annuity concerning risk? - CORRECT
ANSWER - They may believe they will outlive their retirement income
An annuity , issued by an insurance company , is the only type of investment that can guarantee
what? - CORRECT ANSWER - Guarantee a lifetime income that the annuitant cannot
outlive
Most policies will pay the accidental death benefits as long as the death is caused by the accident
and occurs within how many days ? - CORRECT ANSWER - 90 days
List 3 personal uses of life insurance & 1 circumstance that isn't a personal use of life insurance -
CORRECT ANSWER - #1 you buy life insurance to provide future income for a surviving
spouse
#2 an individual buys term insurance to help the family pay off the mortgage in case of
premature death
