CA Life, Accident, & Health Practice
Exam Questions + Verified Answers
100% correct, Update 2026
Why would a large manufacturer choose to self-insure rather than
buy an insurance policy from an insurance company? -
correct answer ✅to save insurance premiums by paying relatively
minor losses out of company funds
The federal Risk Retention Act of 1986 contains guidelines for which
of the following entities? -
correct answer ✅Risk retention groups
Which of the following is an example of an unauthorized insurance
company in Illinois? -
correct answer ✅Company B, an Iowa-based company that does
not hold a certificate of authority in Illinois and sells products that
are not approved by the Illinois insurance department
Which insurance company function calculates company mortality
and morbidity rates as well as the dividends on participating life
insurance policies? -
correct answer ✅Actuarial Division
The purpose for the Buyer's Guide, which must be given to every
insurance prospect in the first meeting with a producer, is to: -
,CA Life, Accident, & Health Practice
Exam Questions + Verified Answers
100% correct, Update 2026
correct answer ✅explain the general features, benefits, and
conditions of the type of insurance being considered
The purpose for the Policy Summary, which must be given to every
insurance applicant before an application is signed, is to: -
correct answer ✅provide buyers with details of the specific
insurance contract they are considering for purchase
The main purpose for errors and omissions insurance (E&O) is to: -
correct answer ✅cover damages that arise due to services a
producer non-willfully failed to render
(does not protect against willful misconduct, and will not protect
the producer who willfully engages in an unfair trade practice)
Though not specifically cited in the producer's contract, the
producer is expected to telephone prospects on the insurer's behalf
to arrange sales appointments. This is an example of what kind of
producer authority? -
correct answer ✅implied authority
,CA Life, Accident, & Health Practice
Exam Questions + Verified Answers
100% correct, Update 2026
Jerry owns a life insurance policy with premiums payable directly to
the insurer's home office. However, for the past five years Jerry has
sent his payments to his agent, who then forwards them to the
insurer. The insurer had accepted this arrangement but then tries to
cancel Jerry's policy when it learns he had died while the premium
was being forwarded by the agent. The insurer will probably not be
able to cancel the policy in this case because of which of the
following legal principles?
misrepresentation
waiver
estoppel
fraud -
correct answer ✅estoppel
(In this case, the insurance company has allowed Jerry to send
payments to his agent instead of directly to the home office for
more than five years. As a result, the insurer has given up its right
to have payments sent to the home office. The insurer is estopped
from later asserting its right to receive direct payment.)
, CA Life, Accident, & Health Practice
Exam Questions + Verified Answers
100% correct, Update 2026
An applicant for a $500,000 whole life insurance policy pays the
initial premium along with his application. In this case, what has the
applicant done?
accepted an offer from the insurer
made a counteroffer to the insurer
accepted a counteroffer from the insurer
made an offer to the insurer -
correct answer ✅made an offer to the insurer
Ambiguities in an insurance contract are most often interpreted in
favor of the policyowner because insurance contracts are:
unilateral
conditional
contracts of adhesion
aleatory -
correct answer ✅contracts of adhesion
Exam Questions + Verified Answers
100% correct, Update 2026
Why would a large manufacturer choose to self-insure rather than
buy an insurance policy from an insurance company? -
correct answer ✅to save insurance premiums by paying relatively
minor losses out of company funds
The federal Risk Retention Act of 1986 contains guidelines for which
of the following entities? -
correct answer ✅Risk retention groups
Which of the following is an example of an unauthorized insurance
company in Illinois? -
correct answer ✅Company B, an Iowa-based company that does
not hold a certificate of authority in Illinois and sells products that
are not approved by the Illinois insurance department
Which insurance company function calculates company mortality
and morbidity rates as well as the dividends on participating life
insurance policies? -
correct answer ✅Actuarial Division
The purpose for the Buyer's Guide, which must be given to every
insurance prospect in the first meeting with a producer, is to: -
,CA Life, Accident, & Health Practice
Exam Questions + Verified Answers
100% correct, Update 2026
correct answer ✅explain the general features, benefits, and
conditions of the type of insurance being considered
The purpose for the Policy Summary, which must be given to every
insurance applicant before an application is signed, is to: -
correct answer ✅provide buyers with details of the specific
insurance contract they are considering for purchase
The main purpose for errors and omissions insurance (E&O) is to: -
correct answer ✅cover damages that arise due to services a
producer non-willfully failed to render
(does not protect against willful misconduct, and will not protect
the producer who willfully engages in an unfair trade practice)
Though not specifically cited in the producer's contract, the
producer is expected to telephone prospects on the insurer's behalf
to arrange sales appointments. This is an example of what kind of
producer authority? -
correct answer ✅implied authority
,CA Life, Accident, & Health Practice
Exam Questions + Verified Answers
100% correct, Update 2026
Jerry owns a life insurance policy with premiums payable directly to
the insurer's home office. However, for the past five years Jerry has
sent his payments to his agent, who then forwards them to the
insurer. The insurer had accepted this arrangement but then tries to
cancel Jerry's policy when it learns he had died while the premium
was being forwarded by the agent. The insurer will probably not be
able to cancel the policy in this case because of which of the
following legal principles?
misrepresentation
waiver
estoppel
fraud -
correct answer ✅estoppel
(In this case, the insurance company has allowed Jerry to send
payments to his agent instead of directly to the home office for
more than five years. As a result, the insurer has given up its right
to have payments sent to the home office. The insurer is estopped
from later asserting its right to receive direct payment.)
, CA Life, Accident, & Health Practice
Exam Questions + Verified Answers
100% correct, Update 2026
An applicant for a $500,000 whole life insurance policy pays the
initial premium along with his application. In this case, what has the
applicant done?
accepted an offer from the insurer
made a counteroffer to the insurer
accepted a counteroffer from the insurer
made an offer to the insurer -
correct answer ✅made an offer to the insurer
Ambiguities in an insurance contract are most often interpreted in
favor of the policyowner because insurance contracts are:
unilateral
conditional
contracts of adhesion
aleatory -
correct answer ✅contracts of adhesion
