California Life Insurance State Exam
Simulator – Real Exam Practice 2025
Exclusion ratio - ANSWER ✨✔---An annuitant would life to determine the amount of an annuity
distribution that is exempt from taxation. What is used to calculate this?
Mortality rate,
Exclusion ratio,
Morbidity rate,
Debt-to-Equity ration
Offers a maximum interest rate that increases annually - ANSWER ✨✔---Which of the following is
NOT a feature of equity-indexed annuities?
Offers long term inflation protection, Offers a minimum guaranteed rate, Offers a maximum interest
rate that increases annually, Offers protection during a decline in the stock market
,Joint and survivor annuity - ANSWER ✨✔---What kind of annuity pays income to two annuitants
until their deaths?
Period certain annuity
Joint and survivor annuity
Straight life annuity
Installment refund
For a minimum of 120 months and a maximum of the remainder of his life - ANSWER ✨✔---
Victoria owns a life annuity and elects to receive annuity payments monthly for the remainder of her life
with "ten years certain". Her annuity will make payments
For a period of time dependent on the performance of the annuity's underlying assets
For a maximum of 120 months
For the remainder of her life only
For a minimum of 120 months and a maximum of the remainder of his life
Variable annuity - ANSWER ✨✔---An annuitant would life to determine the current value of her
annuity. To do this, she multiplies the number of "accumulation units" she owns times the unit value of
the "separate account". What kind of annuity BEST matches this description?
Variable annuity
Fixed annuity
Immediate annuity
Life annuity
60 payments - ANSWER ✨✔---Cindy buys a 10-year annuity with an installment refund. After
receiving monthly payments for 5 years, Cindy dies. How many remaining payments will the insurer
make to her beneficiary?
No payments
30 payments
60 payments
120 payments
,To protect against the risk of outliving their financial resources - ANSWER ✨✔---What is a common
reason people purchase an annuity?
To create an immediate estate
To pay off a debt in the event of death
To minimize their tax burden
To protect against the risk of outliving their financial resources
Variable annuity - ANSWER ✨✔---An annuity which is backed by a life insurer's separate account is
called a(n)
Equity indexed annuity
Variable annuity
Immediate annuity
403(b) plan
The time at which benefit payments start - ANSWER ✨✔---What distinguishes a deferred annuity
from an immediate annuity?
The time at which benefit payments start
The benefit payment amount
The taxation of benefit payments
The age at which the annuity can be purchased
Deferred annuity - ANSWER ✨✔---A savings vehicle designed to first accumulate funds and then
systematically liquidates the funds is called a(n)
Immediate annuity
Deferred annuity
Endowment
Whole life policy
Insurance policy - ANSWER ✨✔---Which of the following is a contract that involves one party
which indemnifies another when a loss arises from an unknown event?
, Insurance policy
Loss contract
Warranty arrangement
Indemnification arrangement
Mutual insurer - ANSWER ✨✔---A participating company is also referred to as which type of
insurer?
Reciprocal insurer
Re-insurer
Mutual insurer
Domestic insurer
Reinsurance - ANSWER ✨✔---An insurer enters into a contract with a third party to insure itself
against losses from insurance policies it issues. What is this agreement called?
Reinsurance
Mutual
Multi-line
Reserves
Primary insurer - ANSWER ✨✔---AAA Insurance Company has trANSWERferred a portion of its loss
exposure to BBB Insurance Company. In this reinsurance trANSWERaction, what is AAA Insurance
Company called?
Tertiary insurer
Primary insurer
Secondary insurer
Captive insurer
Contract that allows the policyowner to receive a share of surplus in the form of policy dividends -
ANSWER ✨✔---What is a participating life insurance policy?
Contract that gives beneficiaries the right to participate in any dividends
Simulator – Real Exam Practice 2025
Exclusion ratio - ANSWER ✨✔---An annuitant would life to determine the amount of an annuity
distribution that is exempt from taxation. What is used to calculate this?
Mortality rate,
Exclusion ratio,
Morbidity rate,
Debt-to-Equity ration
Offers a maximum interest rate that increases annually - ANSWER ✨✔---Which of the following is
NOT a feature of equity-indexed annuities?
Offers long term inflation protection, Offers a minimum guaranteed rate, Offers a maximum interest
rate that increases annually, Offers protection during a decline in the stock market
,Joint and survivor annuity - ANSWER ✨✔---What kind of annuity pays income to two annuitants
until their deaths?
Period certain annuity
Joint and survivor annuity
Straight life annuity
Installment refund
For a minimum of 120 months and a maximum of the remainder of his life - ANSWER ✨✔---
Victoria owns a life annuity and elects to receive annuity payments monthly for the remainder of her life
with "ten years certain". Her annuity will make payments
For a period of time dependent on the performance of the annuity's underlying assets
For a maximum of 120 months
For the remainder of her life only
For a minimum of 120 months and a maximum of the remainder of his life
Variable annuity - ANSWER ✨✔---An annuitant would life to determine the current value of her
annuity. To do this, she multiplies the number of "accumulation units" she owns times the unit value of
the "separate account". What kind of annuity BEST matches this description?
Variable annuity
Fixed annuity
Immediate annuity
Life annuity
60 payments - ANSWER ✨✔---Cindy buys a 10-year annuity with an installment refund. After
receiving monthly payments for 5 years, Cindy dies. How many remaining payments will the insurer
make to her beneficiary?
No payments
30 payments
60 payments
120 payments
,To protect against the risk of outliving their financial resources - ANSWER ✨✔---What is a common
reason people purchase an annuity?
To create an immediate estate
To pay off a debt in the event of death
To minimize their tax burden
To protect against the risk of outliving their financial resources
Variable annuity - ANSWER ✨✔---An annuity which is backed by a life insurer's separate account is
called a(n)
Equity indexed annuity
Variable annuity
Immediate annuity
403(b) plan
The time at which benefit payments start - ANSWER ✨✔---What distinguishes a deferred annuity
from an immediate annuity?
The time at which benefit payments start
The benefit payment amount
The taxation of benefit payments
The age at which the annuity can be purchased
Deferred annuity - ANSWER ✨✔---A savings vehicle designed to first accumulate funds and then
systematically liquidates the funds is called a(n)
Immediate annuity
Deferred annuity
Endowment
Whole life policy
Insurance policy - ANSWER ✨✔---Which of the following is a contract that involves one party
which indemnifies another when a loss arises from an unknown event?
, Insurance policy
Loss contract
Warranty arrangement
Indemnification arrangement
Mutual insurer - ANSWER ✨✔---A participating company is also referred to as which type of
insurer?
Reciprocal insurer
Re-insurer
Mutual insurer
Domestic insurer
Reinsurance - ANSWER ✨✔---An insurer enters into a contract with a third party to insure itself
against losses from insurance policies it issues. What is this agreement called?
Reinsurance
Mutual
Multi-line
Reserves
Primary insurer - ANSWER ✨✔---AAA Insurance Company has trANSWERferred a portion of its loss
exposure to BBB Insurance Company. In this reinsurance trANSWERaction, what is AAA Insurance
Company called?
Tertiary insurer
Primary insurer
Secondary insurer
Captive insurer
Contract that allows the policyowner to receive a share of surplus in the form of policy dividends -
ANSWER ✨✔---What is a participating life insurance policy?
Contract that gives beneficiaries the right to participate in any dividends
