Alabama Life and Health Exam Questions and Answers |Fall
2025/2026 Update | 100% Correct
Question 1
In reference to the standard Medicare Supplement benefits plans, what does the term standard mean?
a) All plans must include basic benefits A-N.
b) Coverage options and conditions are developed for average individuals.
c) All providers will have the same coverage options and conditions for each plan.
d) Coverage options and conditions comply with the law, but will vary from provider to provider.
Correct Answer
C
Question 2
Which of the following is true regarding a single life settlement option?
a) Payments continue until the entire principal is exhausted.
b) Proceeds are paid out in a lump sum.
c) It provides income for a specified period of time.
d) It provides income the beneficiary cannot outlive.
Correct Answer
D
Page 1 of 42
,Question 3
What is the maximum penalty for habitual willful noncompliance with the Fair Credit Reporting Act?
a) Revocation of license
b) $2,500
c) $1,000
d) $100 per violation
Correct Answer
B
Question 4
Which of the following is NOT an allowable 1035 exchange?
a) A whole life insurance policy is exchanged for a term insurance policy.
b) A whole life insurance policy is exchanged for a Universal life insurance policy.
c) An annuity is exchanged for another annuity.
d) A life insurance policy is exchanged for an annuity.
Correct Answer
A
Page 2 of 42
,Question 5
Most insurers issue health insurance policies for delivery in many states. Because each state regulates and mandates the
requirement for policies delivered to their residents, instead of having a policy form for each state, the insurer attaches
a) A waiver of other state requirements.
b) Nothing. An insurer's policy only needs to conform to the regulations of the state where the insurer is domiciled.
c) Conformity with State Statutes provision.
d) Miscellaneous optional provision.
Correct Answer
C
Question 6
Which concept is associated with "exclusion ratio"?
a) Dividend distribution
b) How exclusion riders affect an insurance premium
c) Policy provisions
d) Annuities payments
Correct Answer
D
Page 3 of 42
, Question 7
When a homeowner purchases insurance on his home, what risk management technique is he practicing?
a) Retention
b) Transfer
c) Avoidance
d) Sharing
Correct Answer
B
Question 8
Officers who manage stock insurance companies are
a) Appointed by the Department of Insurance.
b) Elected by the stockholders.
c) Hired through an application process.
d) Appointed by other company officials.
Correct Answer
B
Page 4 of 42
2025/2026 Update | 100% Correct
Question 1
In reference to the standard Medicare Supplement benefits plans, what does the term standard mean?
a) All plans must include basic benefits A-N.
b) Coverage options and conditions are developed for average individuals.
c) All providers will have the same coverage options and conditions for each plan.
d) Coverage options and conditions comply with the law, but will vary from provider to provider.
Correct Answer
C
Question 2
Which of the following is true regarding a single life settlement option?
a) Payments continue until the entire principal is exhausted.
b) Proceeds are paid out in a lump sum.
c) It provides income for a specified period of time.
d) It provides income the beneficiary cannot outlive.
Correct Answer
D
Page 1 of 42
,Question 3
What is the maximum penalty for habitual willful noncompliance with the Fair Credit Reporting Act?
a) Revocation of license
b) $2,500
c) $1,000
d) $100 per violation
Correct Answer
B
Question 4
Which of the following is NOT an allowable 1035 exchange?
a) A whole life insurance policy is exchanged for a term insurance policy.
b) A whole life insurance policy is exchanged for a Universal life insurance policy.
c) An annuity is exchanged for another annuity.
d) A life insurance policy is exchanged for an annuity.
Correct Answer
A
Page 2 of 42
,Question 5
Most insurers issue health insurance policies for delivery in many states. Because each state regulates and mandates the
requirement for policies delivered to their residents, instead of having a policy form for each state, the insurer attaches
a) A waiver of other state requirements.
b) Nothing. An insurer's policy only needs to conform to the regulations of the state where the insurer is domiciled.
c) Conformity with State Statutes provision.
d) Miscellaneous optional provision.
Correct Answer
C
Question 6
Which concept is associated with "exclusion ratio"?
a) Dividend distribution
b) How exclusion riders affect an insurance premium
c) Policy provisions
d) Annuities payments
Correct Answer
D
Page 3 of 42
, Question 7
When a homeowner purchases insurance on his home, what risk management technique is he practicing?
a) Retention
b) Transfer
c) Avoidance
d) Sharing
Correct Answer
B
Question 8
Officers who manage stock insurance companies are
a) Appointed by the Department of Insurance.
b) Elected by the stockholders.
c) Hired through an application process.
d) Appointed by other company officials.
Correct Answer
B
Page 4 of 42
