Life and Health AL Insurance Exam Prep Guide
2026 with 150 Recently Tested Questions and
Correct Answers/ Alabama Life and Health
Insurance Practice Test 2026 (New!)
Which of the following is CORRECT concerning the payment of commissions for
insurance in Alabama?
A. No insurer may pay a commission to relatives of a deceased insurance producer.
B. No insurer may pay a person holding only a temporary producer license.
C. An insurer who violates the Alabama rules on commission payments may be
fined up to three times the amount of the commissions paid.
D. An individual producer may share commissions with other persons, even if they
are not licensed for the same lines of insurance. - ANSWER-no insurer may pay a
commission to relatives of a deceased insurance producer
A company chartered in Alabama would be considered what type of insurance
company in Ohio?
A. Domestic
B. Foreign
C. Alien
D. Non-admitted - ANSWER-B. Foreign
Interest Sensitive Whole Life is also called?
A. Universal Term.
B. Current Assumption Whole Life.
C. Endowment Whole Life.
pg. 1
,D. Variable Interest Whole Life. - ANSWER-current assumption whole life
Under the waiver of premium provision of a life insurance policy, if a disability
proves total and permanent, what happens to any premiums paid by the
policyowner during the waiting period?
A. Nothing. Premiums are always due and payable as prescribed by the policy.
B. Nothing. The premium payments by the company always begin as of the date
the waiting period expires.
C. All premiums paid by the policyholder during the waiting period are typically
refunded.
D. Only half of the premiums paid by - ANSWER-All premiums paid by the
policyholder during the waiting period are typically refunded
For life insurance purposes, all persons are considered to be statistically 'dead' at
age
A. 88.
B. 92.
C. 96.
D. 100. - ANSWER-100
If Todd has been named the irrevocable beneficiary of a life insurance policy, he
A. cannot be replaced as beneficiary without his consent.
B. may be replaced as beneficiary at any time.
C. may be replaced but only by another irrevocable beneficiary.
D. is responsible for the premium payments - ANSWER-cannot be replaced as
beneficiary without his consent.
pg. 2
,If an insured under a Major Medical insurance policy with a $200 deductible and
an 80% coinsurance clause incurred the following covered expenses: Hospital
room and board $2,000; Surgeon's fee $1,500. How much would the policy pay?
A. 2,480 [2,000 - 200 + 1,500 - 200 = 3,100 x .80]
B. $2,600 [2,000 + 1,500 = 3,500 x .80 = 2,800 - 200]
C. $2,640 [2,000 + 1,500 = 3,500 - 200 = 3,300 x .80]
D. $2,800 [2,000 + 1,500 = 3,500 x .80] - ANSWER-$2,640 [2,000 + 1,500 =
3,500 - 200 = 3,300 x .80]
Under a collateral assignment, the policyowner
A. assigns only a portion of the policy proceeds to the assignee.
B. assigns the entire amount of the proceeds to the assignee.
C. receives a certificate for the proceeds from the assignee.
D. must include additional collateral in order to receive the full loan value of the
policy. - ANSWER-assigns only a portion of the policy proceeds to the assignee
If the insurance company accepts a special class risk
A. it then normally writes insurance for that risk in small face amounts.
B. the premium will be higher than for a normal risk.
C. the premium will be lower than for a normal risk.
D. the premium will be the same as for a normal risk. - ANSWER-the premium
will be higher than for a normal risk.
All of the following would likely be eligible for group life insurance EXCEPT:
A. all the uninsured residents of the Golden Years Nursing Home.
B. all the state's public school teachers.
C. employees of a nuclear power plant.
pg. 3
, D. members of a coal miner's union. - ANSWER-all the uninsured residents of the
golden years nursing home
A man with an Accidental Death & Dismemberment (AD&D) policy having a
Principal Sum of $100,000 and a Capital Sum of $50,000 loses a leg due to a blood
clot which was not due to an accident. The policy will pay
A. $0
Your Answer
B. $50,000
C. $100,000
D. $150,000 - ANSWER-0
The factors that determine the amount of each payment to a beneficiary under the
fixed period (fixed time) option are the
A. length of the fixed period and the death benefit of the policy.
B. length of the fixed period and the death benefit of the policy, and the age of the
beneficiary.
C. length of the fixed period and the death benefit of the policy, and interest.
D. length of the fixed period, the death benefit of the policy, interest, and the age
of the beneficiary. - ANSWER-length of the fixed period and the death benefit of
the policy, and interest
Billy is the owner of a life insurance policy and has chosen a policy settlement
option under which the company will pay the beneficiary (his widow) an income
each month for as long as she lives. Payment stops at her death. Which settlement
option has Billy selected?
A. Fixed amount option
pg. 4
2026 with 150 Recently Tested Questions and
Correct Answers/ Alabama Life and Health
Insurance Practice Test 2026 (New!)
Which of the following is CORRECT concerning the payment of commissions for
insurance in Alabama?
A. No insurer may pay a commission to relatives of a deceased insurance producer.
B. No insurer may pay a person holding only a temporary producer license.
C. An insurer who violates the Alabama rules on commission payments may be
fined up to three times the amount of the commissions paid.
D. An individual producer may share commissions with other persons, even if they
are not licensed for the same lines of insurance. - ANSWER-no insurer may pay a
commission to relatives of a deceased insurance producer
A company chartered in Alabama would be considered what type of insurance
company in Ohio?
A. Domestic
B. Foreign
C. Alien
D. Non-admitted - ANSWER-B. Foreign
Interest Sensitive Whole Life is also called?
A. Universal Term.
B. Current Assumption Whole Life.
C. Endowment Whole Life.
pg. 1
,D. Variable Interest Whole Life. - ANSWER-current assumption whole life
Under the waiver of premium provision of a life insurance policy, if a disability
proves total and permanent, what happens to any premiums paid by the
policyowner during the waiting period?
A. Nothing. Premiums are always due and payable as prescribed by the policy.
B. Nothing. The premium payments by the company always begin as of the date
the waiting period expires.
C. All premiums paid by the policyholder during the waiting period are typically
refunded.
D. Only half of the premiums paid by - ANSWER-All premiums paid by the
policyholder during the waiting period are typically refunded
For life insurance purposes, all persons are considered to be statistically 'dead' at
age
A. 88.
B. 92.
C. 96.
D. 100. - ANSWER-100
If Todd has been named the irrevocable beneficiary of a life insurance policy, he
A. cannot be replaced as beneficiary without his consent.
B. may be replaced as beneficiary at any time.
C. may be replaced but only by another irrevocable beneficiary.
D. is responsible for the premium payments - ANSWER-cannot be replaced as
beneficiary without his consent.
pg. 2
,If an insured under a Major Medical insurance policy with a $200 deductible and
an 80% coinsurance clause incurred the following covered expenses: Hospital
room and board $2,000; Surgeon's fee $1,500. How much would the policy pay?
A. 2,480 [2,000 - 200 + 1,500 - 200 = 3,100 x .80]
B. $2,600 [2,000 + 1,500 = 3,500 x .80 = 2,800 - 200]
C. $2,640 [2,000 + 1,500 = 3,500 - 200 = 3,300 x .80]
D. $2,800 [2,000 + 1,500 = 3,500 x .80] - ANSWER-$2,640 [2,000 + 1,500 =
3,500 - 200 = 3,300 x .80]
Under a collateral assignment, the policyowner
A. assigns only a portion of the policy proceeds to the assignee.
B. assigns the entire amount of the proceeds to the assignee.
C. receives a certificate for the proceeds from the assignee.
D. must include additional collateral in order to receive the full loan value of the
policy. - ANSWER-assigns only a portion of the policy proceeds to the assignee
If the insurance company accepts a special class risk
A. it then normally writes insurance for that risk in small face amounts.
B. the premium will be higher than for a normal risk.
C. the premium will be lower than for a normal risk.
D. the premium will be the same as for a normal risk. - ANSWER-the premium
will be higher than for a normal risk.
All of the following would likely be eligible for group life insurance EXCEPT:
A. all the uninsured residents of the Golden Years Nursing Home.
B. all the state's public school teachers.
C. employees of a nuclear power plant.
pg. 3
, D. members of a coal miner's union. - ANSWER-all the uninsured residents of the
golden years nursing home
A man with an Accidental Death & Dismemberment (AD&D) policy having a
Principal Sum of $100,000 and a Capital Sum of $50,000 loses a leg due to a blood
clot which was not due to an accident. The policy will pay
A. $0
Your Answer
B. $50,000
C. $100,000
D. $150,000 - ANSWER-0
The factors that determine the amount of each payment to a beneficiary under the
fixed period (fixed time) option are the
A. length of the fixed period and the death benefit of the policy.
B. length of the fixed period and the death benefit of the policy, and the age of the
beneficiary.
C. length of the fixed period and the death benefit of the policy, and interest.
D. length of the fixed period, the death benefit of the policy, interest, and the age
of the beneficiary. - ANSWER-length of the fixed period and the death benefit of
the policy, and interest
Billy is the owner of a life insurance policy and has chosen a policy settlement
option under which the company will pay the beneficiary (his widow) an income
each month for as long as she lives. Payment stops at her death. Which settlement
option has Billy selected?
A. Fixed amount option
pg. 4
