PEARSON VUE LIFE INSURANCE FINAL PAPER
2026 FULL QUESTIONS AND CORRECT
SOLUTIONS
◉ Which of the following statements about a Renewable Term policy
is CORRECT? Answer: It is renewable at the option of the insured.
◉ Two business partners own life insurance on each other. If one
partner dies, which of the following contracts will allow the other
partner to buy 100 percent of the business interest? Answer: Buy
and Sell Agreement
◉ An insured intentionally understates her age on her application
for a life policy. At death, the insurer will take which of the following
actions? Answer: Pay a reduced Death benefit based on the insured's
actual age
◉ An applicant's statements on an application are considered to be
legal: Answer: representations
◉ A contract that promises to pay an income to an insured until
his/her death is called: Answer: Life Annuity
, ◉ An employer can deduct premium payments as an ordinary
business expense for which of the following life coverages? Answer:
Group
◉ Which of the following annuities would BEST suit the needs of a
35-year-old factory worker who is concerned about inflation and
wants to establish a retirement plan? Answer: A Flexible Premium
Variable Annuity
◉ A client needs a substantial amount of protection but has limited
financial resources. Which of the following insurance policies would
BEST meet the client's needs? Answer: Term Life
◉ An applicant for life insurance may question the validity and
source of any consumer information developed under the: Answer:
Fair Credit Reporting Act (Insurance Information and Privacy
Protection Act)
◉ Which of the following policy provisions provides for continuation
of coverage despite nonpayment of premiums? Answer:
Nonforfeiture Option
◉ Federal income tax laws generally treat proceeds of life insurance
policies as: Answer: nontaxable
2026 FULL QUESTIONS AND CORRECT
SOLUTIONS
◉ Which of the following statements about a Renewable Term policy
is CORRECT? Answer: It is renewable at the option of the insured.
◉ Two business partners own life insurance on each other. If one
partner dies, which of the following contracts will allow the other
partner to buy 100 percent of the business interest? Answer: Buy
and Sell Agreement
◉ An insured intentionally understates her age on her application
for a life policy. At death, the insurer will take which of the following
actions? Answer: Pay a reduced Death benefit based on the insured's
actual age
◉ An applicant's statements on an application are considered to be
legal: Answer: representations
◉ A contract that promises to pay an income to an insured until
his/her death is called: Answer: Life Annuity
, ◉ An employer can deduct premium payments as an ordinary
business expense for which of the following life coverages? Answer:
Group
◉ Which of the following annuities would BEST suit the needs of a
35-year-old factory worker who is concerned about inflation and
wants to establish a retirement plan? Answer: A Flexible Premium
Variable Annuity
◉ A client needs a substantial amount of protection but has limited
financial resources. Which of the following insurance policies would
BEST meet the client's needs? Answer: Term Life
◉ An applicant for life insurance may question the validity and
source of any consumer information developed under the: Answer:
Fair Credit Reporting Act (Insurance Information and Privacy
Protection Act)
◉ Which of the following policy provisions provides for continuation
of coverage despite nonpayment of premiums? Answer:
Nonforfeiture Option
◉ Federal income tax laws generally treat proceeds of life insurance
policies as: Answer: nontaxable
