NM LIFE INSURANCE FINAL EXAM MOCK TEST | NM
LIFE INSURANCE FINAL EXAM MOCK TEST | 2025/2026
UPDATE | QUESTIONS AND ANSWERS | 100%
CORRECT
How is the uninsured protected if a payor benefit is attached to the life
insurance policy? Answer - premium payments are waived in the event the
premium payor dies or becomes disabled
Which of the following health care plans charges a premium that cannot be
increased? Answer - Noncancelable
What is the effect of the market value adjustments in a market value
adjustment annuity? Answer - Transfers some of the investment risk to the
policyowner
Which type of life insurance policy allows the policyowner the choice of
investments along with flexible premium payments? Answer - Variable
Universal Life
Which of these is NOT considered to be a cost connected with an individual's
death? Answer - Business expenses
A (an) ___________ insurer assumes risk from another insurance company.
Answer - Reinsurance
,When group insurance under COBRA have expired, a fully insured group policy
can be converted to a (an) Answer - Individual health policy
The authority to change the beneficiary in an individual annuity lies with the
Answer - Owner
How are monthly life annuity benefit payments treated under a tax sheltered
annuity (TSA)? Answer - Taxed as an ordinary income in the year recieved
Which individual would be best suited for Medicare Supplement Insurance?
Answer - Medicare enrollee
Which of the following is NOT an example as risk retention? Answer - Not
doing a business deal after deciding it would be too risky.
Tim is in need of surgery. Before being hospitalized, he is referred to an
outpatient clinic for diagnostic tests. What is this an example of? Answer - Pre-
admission testing
Does the Superintendent have the ability to examine the records of authorized
insurers? Answer - Yes, because of the powers granted through state statues
Which statement about group life insurance is INCORRECT? Answer - Each
participant requires evidence of insurability
Medicare Part A does NOT provide coverage for Answer - The first three pints
of blood
, Darrell has a group long-term disability income policy paid by his employer.
Which of these statements is true? Answer - The specified benefit amount is a
percentage of his wages.
Twisting means Answer - Pursuading an insured, to the insured's detriment, to
switch policies.
What is the maxium number of employees (earning at least 5,000) that an
employer can have in order to start a SIMPLE retirement plan? Answer - 100
The following are all elements of a valid contract EXCEPT Answer - written
evidence
Which of the following would permit an insurer to delay a covered disability
policy claim? Answer - Elimination period
Tom has a qualified retirement plan with his employer that is currently
considered to be 80% "vested". How can this be interpreted? Answer - If Tom's
employment is terminated, 20% of his funds could be forfeited.
When a ten year renewable term life insurance policy issued at age 45 is
renewed, the premium rate will be the current rate for Answer - Ten year term
insurance for a person aged 55.
What kind of arrangement gives the policyowner the right to change the
beneficiary? Answer - Revocable designation
Wyatt is shopping for life insurance and is mainly concerned with the policy's
death benefit. Which index should he be looking at when making comparisons?
Answer - Net payment cost index
LIFE INSURANCE FINAL EXAM MOCK TEST | 2025/2026
UPDATE | QUESTIONS AND ANSWERS | 100%
CORRECT
How is the uninsured protected if a payor benefit is attached to the life
insurance policy? Answer - premium payments are waived in the event the
premium payor dies or becomes disabled
Which of the following health care plans charges a premium that cannot be
increased? Answer - Noncancelable
What is the effect of the market value adjustments in a market value
adjustment annuity? Answer - Transfers some of the investment risk to the
policyowner
Which type of life insurance policy allows the policyowner the choice of
investments along with flexible premium payments? Answer - Variable
Universal Life
Which of these is NOT considered to be a cost connected with an individual's
death? Answer - Business expenses
A (an) ___________ insurer assumes risk from another insurance company.
Answer - Reinsurance
,When group insurance under COBRA have expired, a fully insured group policy
can be converted to a (an) Answer - Individual health policy
The authority to change the beneficiary in an individual annuity lies with the
Answer - Owner
How are monthly life annuity benefit payments treated under a tax sheltered
annuity (TSA)? Answer - Taxed as an ordinary income in the year recieved
Which individual would be best suited for Medicare Supplement Insurance?
Answer - Medicare enrollee
Which of the following is NOT an example as risk retention? Answer - Not
doing a business deal after deciding it would be too risky.
Tim is in need of surgery. Before being hospitalized, he is referred to an
outpatient clinic for diagnostic tests. What is this an example of? Answer - Pre-
admission testing
Does the Superintendent have the ability to examine the records of authorized
insurers? Answer - Yes, because of the powers granted through state statues
Which statement about group life insurance is INCORRECT? Answer - Each
participant requires evidence of insurability
Medicare Part A does NOT provide coverage for Answer - The first three pints
of blood
, Darrell has a group long-term disability income policy paid by his employer.
Which of these statements is true? Answer - The specified benefit amount is a
percentage of his wages.
Twisting means Answer - Pursuading an insured, to the insured's detriment, to
switch policies.
What is the maxium number of employees (earning at least 5,000) that an
employer can have in order to start a SIMPLE retirement plan? Answer - 100
The following are all elements of a valid contract EXCEPT Answer - written
evidence
Which of the following would permit an insurer to delay a covered disability
policy claim? Answer - Elimination period
Tom has a qualified retirement plan with his employer that is currently
considered to be 80% "vested". How can this be interpreted? Answer - If Tom's
employment is terminated, 20% of his funds could be forfeited.
When a ten year renewable term life insurance policy issued at age 45 is
renewed, the premium rate will be the current rate for Answer - Ten year term
insurance for a person aged 55.
What kind of arrangement gives the policyowner the right to change the
beneficiary? Answer - Revocable designation
Wyatt is shopping for life insurance and is mainly concerned with the policy's
death benefit. Which index should he be looking at when making comparisons?
Answer - Net payment cost index
