Idaho Life Insurance Final Exam
Questions and All Correct Answers
2025-2026 Edition.
Accelerated Benefits - Answer Riders attached to life insurance policies that allow death
benefits to be used to cover nursing or convalescent home expenses.
Accidental Death Benefits - Answer A policy rider that states that the cause of death will be
analyzed to determine if it complies with the policy description of accidental death.
Accidental Death Insurance - Answer An insurance policy that provides payment if the
insured's death is the result of the accident.
Accumulation Period - Answer The time before an annuitant's retirement during which the
annuitant is making payments or investments in an annuity.
Acquired Immunodeficiency Syndrome (AIDS) - Answer An infections and incurable disease
caused by the human immunodeficiency virus (HIV).
Actual Cash Value (ACV) - Answer The required amount to pay damages or for property loss.
This amount is calculated based on the property's current replacement value minus
depreciation.
Adhesion - Answer A contract offered on a "take-it-or-leave-it" basis by an insurer, in which the
insured's only option is to either accept or reject the contract. Any ambiguities in the contract
will be settled in favor of the insured.
Adjustable Life - Answer Life insurance that permits changed in the face amount, premium
amount, period of protection, and the duration of the premium payment period.
Adjuster - Answer A representative of an insurance company who investigates and acts on
behalf of the company to obtain agreements for the amount of the insurance claim.
Administrator - Answer An individual appointed by a court as a fiduciary to settle the financial
affairs and estate of a deceased person.
,Adult Day Care - Answer A program for impaired adults that attempts to meet their health,
social, and functional needs in a setting away from their homes.
Adverse Selection - Answer The tendency of risks with higher probability of loss to purchase
and maintain insurance more often than the risks who present lower probability.
Agency - Answer An insurance sales office or company.
Agent - Answer An individual who is licensed to sell, negotiate, or effect insurance contracts on
behalf of the insurer.
Agent Appointment - Answer The authorization of an agent to act for or represent an insurer.
Agent's Authority - Answer Special powers granted to an agent by his or her agency contract.
Aleatory - Answer A contract in which participating parties exchange unequal amounts.
Insurance contracts are aleatory in that the amount the insured will pay in premiums is unequal
the the amount the insurer will pay in the event of a loss.
Alien Insurer - Answer An insurance company that is incorporated outside the United States.
Annual Statement - Answer A detailed financial report that an insurance company must submit
every year to the insurance department of state in which it conducts business.
Annuity - Answer A contract that provides income for a specified period of years, or for life.
Apparent Authority - Answer The appearance of the assumption of authority based on the
actions, words, or deeds of the principal or because of circumstances of the principal created.
Applicant - Answer A person making applications for, or offering himself, herself or another to
be insured under an insurance contract.
Appication - Answer A document that provides information for underwriting purposes. After
the policy is issued, any unanswered questions are considered waived by the insurer.
, Attained Age - Answer The age of the insured at a determined date.
Attending Physician's Statement (APS) - Answer A statement usually obtained from the
applicant's doctor.
Authorized (Admitted) Insurer - Answer An insurance company authorized and licensed to
transact business in a particular state.
Avoidance - Answer A method of dealing with risk by deliberately keeping away from it (ex. if a
person wanted to avoid risk of being killed in airplane crash they may never fly)
Basic Illustration - Answer A ledger or proposal used in the sale of a life insurance policy that
shows both guaranteed and non-guaranteed elements.
Beneficiary - Answer The person who receives the proceeds from the policy when the insured
dies.
Binder (Binding Receipt) - Answer A temporary contract that puts an insurance policy into force
before the premium has been paid.
Birthday Rule - Answer The method of determining primary coverage for a dependent child,
under which the plan of the parent whose birthday occurs first in the calendar year is
designated as primary.
Broker - Answer An individual who represents an insured in the process of purchasing and
negotiating a contract of insurance.
Buy-Sell Agreement - Answer A legal contract that determines what will be done with a
business in the event that an owner dies or becomes disabled.
Buyer's Guide - Answer A booklet that describes insurance policies and concepts, and provides
general information to help an applicant make an informed decision.
Cash Value - Answer The amount to which a policyowner is entitled if the policy is surrendered
before maturity.
Questions and All Correct Answers
2025-2026 Edition.
Accelerated Benefits - Answer Riders attached to life insurance policies that allow death
benefits to be used to cover nursing or convalescent home expenses.
Accidental Death Benefits - Answer A policy rider that states that the cause of death will be
analyzed to determine if it complies with the policy description of accidental death.
Accidental Death Insurance - Answer An insurance policy that provides payment if the
insured's death is the result of the accident.
Accumulation Period - Answer The time before an annuitant's retirement during which the
annuitant is making payments or investments in an annuity.
Acquired Immunodeficiency Syndrome (AIDS) - Answer An infections and incurable disease
caused by the human immunodeficiency virus (HIV).
Actual Cash Value (ACV) - Answer The required amount to pay damages or for property loss.
This amount is calculated based on the property's current replacement value minus
depreciation.
Adhesion - Answer A contract offered on a "take-it-or-leave-it" basis by an insurer, in which the
insured's only option is to either accept or reject the contract. Any ambiguities in the contract
will be settled in favor of the insured.
Adjustable Life - Answer Life insurance that permits changed in the face amount, premium
amount, period of protection, and the duration of the premium payment period.
Adjuster - Answer A representative of an insurance company who investigates and acts on
behalf of the company to obtain agreements for the amount of the insurance claim.
Administrator - Answer An individual appointed by a court as a fiduciary to settle the financial
affairs and estate of a deceased person.
,Adult Day Care - Answer A program for impaired adults that attempts to meet their health,
social, and functional needs in a setting away from their homes.
Adverse Selection - Answer The tendency of risks with higher probability of loss to purchase
and maintain insurance more often than the risks who present lower probability.
Agency - Answer An insurance sales office or company.
Agent - Answer An individual who is licensed to sell, negotiate, or effect insurance contracts on
behalf of the insurer.
Agent Appointment - Answer The authorization of an agent to act for or represent an insurer.
Agent's Authority - Answer Special powers granted to an agent by his or her agency contract.
Aleatory - Answer A contract in which participating parties exchange unequal amounts.
Insurance contracts are aleatory in that the amount the insured will pay in premiums is unequal
the the amount the insurer will pay in the event of a loss.
Alien Insurer - Answer An insurance company that is incorporated outside the United States.
Annual Statement - Answer A detailed financial report that an insurance company must submit
every year to the insurance department of state in which it conducts business.
Annuity - Answer A contract that provides income for a specified period of years, or for life.
Apparent Authority - Answer The appearance of the assumption of authority based on the
actions, words, or deeds of the principal or because of circumstances of the principal created.
Applicant - Answer A person making applications for, or offering himself, herself or another to
be insured under an insurance contract.
Appication - Answer A document that provides information for underwriting purposes. After
the policy is issued, any unanswered questions are considered waived by the insurer.
, Attained Age - Answer The age of the insured at a determined date.
Attending Physician's Statement (APS) - Answer A statement usually obtained from the
applicant's doctor.
Authorized (Admitted) Insurer - Answer An insurance company authorized and licensed to
transact business in a particular state.
Avoidance - Answer A method of dealing with risk by deliberately keeping away from it (ex. if a
person wanted to avoid risk of being killed in airplane crash they may never fly)
Basic Illustration - Answer A ledger or proposal used in the sale of a life insurance policy that
shows both guaranteed and non-guaranteed elements.
Beneficiary - Answer The person who receives the proceeds from the policy when the insured
dies.
Binder (Binding Receipt) - Answer A temporary contract that puts an insurance policy into force
before the premium has been paid.
Birthday Rule - Answer The method of determining primary coverage for a dependent child,
under which the plan of the parent whose birthday occurs first in the calendar year is
designated as primary.
Broker - Answer An individual who represents an insured in the process of purchasing and
negotiating a contract of insurance.
Buy-Sell Agreement - Answer A legal contract that determines what will be done with a
business in the event that an owner dies or becomes disabled.
Buyer's Guide - Answer A booklet that describes insurance policies and concepts, and provides
general information to help an applicant make an informed decision.
Cash Value - Answer The amount to which a policyowner is entitled if the policy is surrendered
before maturity.
