ALABAMA INSURANCE CORE EXAM SET 2025/2026
QUESTIONS WITH SOLUTIONS RATED A+
✔✔All of these are correct concerning group life insurance except: - ✔✔Whole life
insurance is the form of insurance typically used in group life insurance
✔✔- All of these statements concerning Key Employee Life policy is true except: -
✔✔key employee names the beneficiary
✔✔An accidental death rider claim is usually paid if the insured: - ✔✔dies within 90
days of the accident
✔✔An employee of 20 years recently retired at age 59 1/2. This employee group life
contract can be: - ✔✔Converted to an individual permit policy at an individual rate
✔✔An example of a life insurance beneficiary is a(n): - ✔✔All of these
✔✔An immediate annuity consists of a: - ✔✔single premium
✔✔An insurance company licensed to do business in Alabama, but incorporated in
another state is called: - ✔✔foreign company
✔✔An insurance company licensed to solicit insurance in a specific state is called: -
✔✔an admitted company
✔✔An insurance company may cancel a life insurance policy under which of the
following conditions? - ✔✔that outstanding policy loan exceeds the cash value of the
policy
✔✔An insurance company that cedes a portion of an insured's coverage to another
insurer is said to be engaged in: - ✔✔Reinsurance
✔✔An insurance contract is said to be a(n) _______ because there is a mutual reliance
of truthfulness on both parties. - ✔✔Contract of upmost good faith
✔✔An insurance Premium can be defined as: - ✔✔Money paid to an insurance
company for benefits provided in the policy
✔✔An insurance producer must have which of the following in order to sell variable life
insurance policies? - ✔✔All of these
✔✔An insurance producer represents the: - ✔✔the insurance company
, ✔✔An insurance producer who offers a potential client something of value as an
incentive to purchase insurance is engaging in: - ✔✔Rebating
✔✔An insured should be restored to the approximate financial condition occupied
before the loss occurred. This is called the: - ✔✔Aleatory contract
✔✔Ann is an employee covered by a Group Life plan through her employer. When Ann
is terminated, her employer fails to inform her about the plan's conversion option two
weeks later, Ann dies in an automobile accident. How will this situation be handled? -
✔✔Full benefits must be paid by the insurers
✔✔Any individual who has failed two Alabama insurance licensing
examinations must wait how long before retaking it a third time? - ✔✔Three months
✔✔At what point does a whole life policy pay the face amount? - ✔✔upon death or
reaching the age of 100
✔✔B receives yearly dividends and interest from a participating life insurance policy.
Which of these should B include as gross income for federal income tax purposes? -
✔✔Interest only
✔✔Barbara has the right to change the beneficiary designation on her life insurance.
Barbara's beneficiary is a(n): - ✔✔Revocable beneficiary
✔✔Beginning at what age can IRA owner start making withdrawals and NOT be
subjected to a tax penalty? - ✔✔59 ½
✔✔Bert purchased an immediate annuity with quarterly payments. When will this
annuity start making payments? - ✔✔3 months after the annuity is bought
✔✔Bob has an insurance policy that allows to keep the policy in force until the next
premium is due plus 30 days thereafter. Bob's policy: - ✔✔Contains a good grace
period
✔✔C is a key employee at ABC Incorporated. If a Key Employee life policy is purchased
on her life, which of these statements would be true? - ✔✔ABC is the policyowner C is
the insured and ABC is the beneficiary
✔✔Carol is life insurance policyowner who has transferred her ownership to a third
party in exchange for a percentage of death benefit. What is this called? - ✔✔- Viatical
settlement agreement
QUESTIONS WITH SOLUTIONS RATED A+
✔✔All of these are correct concerning group life insurance except: - ✔✔Whole life
insurance is the form of insurance typically used in group life insurance
✔✔- All of these statements concerning Key Employee Life policy is true except: -
✔✔key employee names the beneficiary
✔✔An accidental death rider claim is usually paid if the insured: - ✔✔dies within 90
days of the accident
✔✔An employee of 20 years recently retired at age 59 1/2. This employee group life
contract can be: - ✔✔Converted to an individual permit policy at an individual rate
✔✔An example of a life insurance beneficiary is a(n): - ✔✔All of these
✔✔An immediate annuity consists of a: - ✔✔single premium
✔✔An insurance company licensed to do business in Alabama, but incorporated in
another state is called: - ✔✔foreign company
✔✔An insurance company licensed to solicit insurance in a specific state is called: -
✔✔an admitted company
✔✔An insurance company may cancel a life insurance policy under which of the
following conditions? - ✔✔that outstanding policy loan exceeds the cash value of the
policy
✔✔An insurance company that cedes a portion of an insured's coverage to another
insurer is said to be engaged in: - ✔✔Reinsurance
✔✔An insurance contract is said to be a(n) _______ because there is a mutual reliance
of truthfulness on both parties. - ✔✔Contract of upmost good faith
✔✔An insurance Premium can be defined as: - ✔✔Money paid to an insurance
company for benefits provided in the policy
✔✔An insurance producer must have which of the following in order to sell variable life
insurance policies? - ✔✔All of these
✔✔An insurance producer represents the: - ✔✔the insurance company
, ✔✔An insurance producer who offers a potential client something of value as an
incentive to purchase insurance is engaging in: - ✔✔Rebating
✔✔An insured should be restored to the approximate financial condition occupied
before the loss occurred. This is called the: - ✔✔Aleatory contract
✔✔Ann is an employee covered by a Group Life plan through her employer. When Ann
is terminated, her employer fails to inform her about the plan's conversion option two
weeks later, Ann dies in an automobile accident. How will this situation be handled? -
✔✔Full benefits must be paid by the insurers
✔✔Any individual who has failed two Alabama insurance licensing
examinations must wait how long before retaking it a third time? - ✔✔Three months
✔✔At what point does a whole life policy pay the face amount? - ✔✔upon death or
reaching the age of 100
✔✔B receives yearly dividends and interest from a participating life insurance policy.
Which of these should B include as gross income for federal income tax purposes? -
✔✔Interest only
✔✔Barbara has the right to change the beneficiary designation on her life insurance.
Barbara's beneficiary is a(n): - ✔✔Revocable beneficiary
✔✔Beginning at what age can IRA owner start making withdrawals and NOT be
subjected to a tax penalty? - ✔✔59 ½
✔✔Bert purchased an immediate annuity with quarterly payments. When will this
annuity start making payments? - ✔✔3 months after the annuity is bought
✔✔Bob has an insurance policy that allows to keep the policy in force until the next
premium is due plus 30 days thereafter. Bob's policy: - ✔✔Contains a good grace
period
✔✔C is a key employee at ABC Incorporated. If a Key Employee life policy is purchased
on her life, which of these statements would be true? - ✔✔ABC is the policyowner C is
the insured and ABC is the beneficiary
✔✔Carol is life insurance policyowner who has transferred her ownership to a third
party in exchange for a percentage of death benefit. What is this called? - ✔✔- Viatical
settlement agreement
