TEXAS ADJUSTER 2026 CORE EXAM MANUAL QUESTIONS
AND ANSWERS MARKED A+
✔✔All of the following are limited benefit plans EXCEPT
cancer policies
life insurance policies
dental policies
critical illness policies - ✔✔life insurance policies
✔✔A physician opens up a new practice and qualifies for a $7,000/month Disability
Income policy. What rider would the physician add if he wants the ability to increase his
policy benefit as his practice and income grow?
Extended Term rider
Cost of Living Adjustment rider
Guaranteed Insurability Option rider
Waiver of Premium rider - ✔✔Guaranteed Insurability Option rider
✔✔An agent whose license has been revoked is required to
wait at least five years before applying for a new license
submit all previously written policies to the Commissioner of Insurance's office for
servicing of the accounts
cancel all policies currently in effect and advise the insureds to place them elsewhere
continue to service the existing accounts but not solicit new business - ✔✔wait at least
five years before applying for a new license
✔✔The benefits under a Disability Buy-Out policy are
normally paid in installments
taxable to the beneficiary
payable to the company or another shareholder
normally paid after a short elimination period - ✔✔payable to the company or another
shareholder
✔✔he Health Insurance Portability and Accountability Act (HIPAA) gives privacy
protection for
insolvency
health information
financial information
overinsurance - ✔✔health information
,✔✔How are surrender charges deducted in a life policy with a rear-end loaded
provision?
Deducted from the death benefit
Deducted when the policy is discontinued
Deducted from policy's cash value
Deducted when assigned to another policyowner - ✔✔Deducted when the policy is
discontinued
✔✔What MUST an insurance company use in its advertising?
Its trade name
Its true corporate name
Its service mark
Its corporate logo - ✔✔Its true corporate name
✔✔An accident policy will most likely pay a benefit for a(n)
self-inflicted injury
critical illness
on-the-job accident
off-the-job accident - ✔✔off-the-job accident
✔✔M completes an application for life insurance but does not pay the initial premium.
All of these actions must occur before M's policy goes into effect EXCEPT
policy is delivered
free-look period has expired
insurance company issues policy
initial premium is collected - ✔✔free-look period has expired
✔✔When a policyowner cash surrenders a Universal Life insurance policy in it's early
years, this may be considered a red flag for a(n)
Federal Fair Credit Act Violation
Title 18 Fraud violation
Anti-Money Laundering violation
Unfair Trade Practice violation - ✔✔Anti-Money Laundering violation
✔✔Which of these do NOT constitute policy delivery?
Policy mailed to applicant
Policy mailed to agent
Policy delivered to the applicant by the agent
Policy issued with a rating - ✔✔Policy issued with a rating
,✔✔What is the MINIMUM number of Activities of Daily Living (ADL) an insured must be
unable to perform to qualify for Long Term Care benefits?
1
2
3
4 - ✔✔2
✔✔An agent who tells a client that dividends are guaranteed may be guilty of
fraud
rebating
misrepresentation
slander - ✔✔misrepresentation
✔✔Which statement regarding a Key Employee Life policy is NOT true?
The application must be signed by the key employee
Its purpose is to prevent the financial loss that may ensue if a key employee dies
The beneficiary is named by the key employee
The company purchases, owns, pays the premiums and is the beneficiary - ✔✔The
beneficiary is named by the key employee
✔✔A policyowner's rights are limited under which beneficiary designation?
Revocable
Tertiary
Contingent
Irrevocable - ✔✔Irrevocable
✔✔Agent J takes an application and initial premium from an applicant and sends the
application and premium check to the insurance company. The insurance company
returns the check back to J because the check is made out to J instead of the insurance
company. What action should J take?
Deposit the applicant's check into his account and make a personal check out to the
insurance company from his personal account
Return to the customer, collect a new check made out to the insurance company, and
send the new check out to the insurance company
Cross off his name on the "pay to" portion of the check, write the name of the insurance
company, and send the check back to the insurance company
Deposit the check in to his personal account, use the funds to purchase a cashiers
check, and send the new cashiers check back to the insurance company - ✔✔Return to
, the customer, collect a new check made out to the insurance company, and send the
new check out to the insurance company
✔✔Variable Whole Life Insurance can be described as
both an insurance and securities product
an insurance product only
a securities product only
the insurance company assumes the investment risk - ✔✔both an insurance and
securities product
✔✔A 66 year-old is covered under a group health plan while employed with a business
that has 40 employees. If she injures herself while walking in the park, what coverage
would be considered primary?
Medicaid
Long-term care
Medicare
Her group health plan - ✔✔Her group health plan
✔✔Medicare
is a disability program
is a hospital and medical expense insurance program
offers assistance in making health insurance premiums
Part D provides payment for surgeon expenses - ✔✔is a hospital and medical expense
insurance program
✔✔T owns an Accident & Health policy and notifies her insurance company that she
has chosen a less hazardous occupation. Under the Change of Occupation provision,
which of the following actions may her insurance company take?
Allow her to take a tax deduction on unearned premiums
Increase her policy's coverage amount
Decrease her policy's coverage amount
Nothing - ✔✔Increase her policy's coverage amount
✔✔All of the following statements about health coverage for newborns are correct
EXCEPT
coverage begins and benefits are payable from the moment of birth
coverage includes necessary care and treatment of congenital defects
coverage during the first year is limited to congenital defects
continued coverage after the first 31 days is dependent on notification - ✔✔coverage
during the first year is limited to congenital defects
AND ANSWERS MARKED A+
✔✔All of the following are limited benefit plans EXCEPT
cancer policies
life insurance policies
dental policies
critical illness policies - ✔✔life insurance policies
✔✔A physician opens up a new practice and qualifies for a $7,000/month Disability
Income policy. What rider would the physician add if he wants the ability to increase his
policy benefit as his practice and income grow?
Extended Term rider
Cost of Living Adjustment rider
Guaranteed Insurability Option rider
Waiver of Premium rider - ✔✔Guaranteed Insurability Option rider
✔✔An agent whose license has been revoked is required to
wait at least five years before applying for a new license
submit all previously written policies to the Commissioner of Insurance's office for
servicing of the accounts
cancel all policies currently in effect and advise the insureds to place them elsewhere
continue to service the existing accounts but not solicit new business - ✔✔wait at least
five years before applying for a new license
✔✔The benefits under a Disability Buy-Out policy are
normally paid in installments
taxable to the beneficiary
payable to the company or another shareholder
normally paid after a short elimination period - ✔✔payable to the company or another
shareholder
✔✔he Health Insurance Portability and Accountability Act (HIPAA) gives privacy
protection for
insolvency
health information
financial information
overinsurance - ✔✔health information
,✔✔How are surrender charges deducted in a life policy with a rear-end loaded
provision?
Deducted from the death benefit
Deducted when the policy is discontinued
Deducted from policy's cash value
Deducted when assigned to another policyowner - ✔✔Deducted when the policy is
discontinued
✔✔What MUST an insurance company use in its advertising?
Its trade name
Its true corporate name
Its service mark
Its corporate logo - ✔✔Its true corporate name
✔✔An accident policy will most likely pay a benefit for a(n)
self-inflicted injury
critical illness
on-the-job accident
off-the-job accident - ✔✔off-the-job accident
✔✔M completes an application for life insurance but does not pay the initial premium.
All of these actions must occur before M's policy goes into effect EXCEPT
policy is delivered
free-look period has expired
insurance company issues policy
initial premium is collected - ✔✔free-look period has expired
✔✔When a policyowner cash surrenders a Universal Life insurance policy in it's early
years, this may be considered a red flag for a(n)
Federal Fair Credit Act Violation
Title 18 Fraud violation
Anti-Money Laundering violation
Unfair Trade Practice violation - ✔✔Anti-Money Laundering violation
✔✔Which of these do NOT constitute policy delivery?
Policy mailed to applicant
Policy mailed to agent
Policy delivered to the applicant by the agent
Policy issued with a rating - ✔✔Policy issued with a rating
,✔✔What is the MINIMUM number of Activities of Daily Living (ADL) an insured must be
unable to perform to qualify for Long Term Care benefits?
1
2
3
4 - ✔✔2
✔✔An agent who tells a client that dividends are guaranteed may be guilty of
fraud
rebating
misrepresentation
slander - ✔✔misrepresentation
✔✔Which statement regarding a Key Employee Life policy is NOT true?
The application must be signed by the key employee
Its purpose is to prevent the financial loss that may ensue if a key employee dies
The beneficiary is named by the key employee
The company purchases, owns, pays the premiums and is the beneficiary - ✔✔The
beneficiary is named by the key employee
✔✔A policyowner's rights are limited under which beneficiary designation?
Revocable
Tertiary
Contingent
Irrevocable - ✔✔Irrevocable
✔✔Agent J takes an application and initial premium from an applicant and sends the
application and premium check to the insurance company. The insurance company
returns the check back to J because the check is made out to J instead of the insurance
company. What action should J take?
Deposit the applicant's check into his account and make a personal check out to the
insurance company from his personal account
Return to the customer, collect a new check made out to the insurance company, and
send the new check out to the insurance company
Cross off his name on the "pay to" portion of the check, write the name of the insurance
company, and send the check back to the insurance company
Deposit the check in to his personal account, use the funds to purchase a cashiers
check, and send the new cashiers check back to the insurance company - ✔✔Return to
, the customer, collect a new check made out to the insurance company, and send the
new check out to the insurance company
✔✔Variable Whole Life Insurance can be described as
both an insurance and securities product
an insurance product only
a securities product only
the insurance company assumes the investment risk - ✔✔both an insurance and
securities product
✔✔A 66 year-old is covered under a group health plan while employed with a business
that has 40 employees. If she injures herself while walking in the park, what coverage
would be considered primary?
Medicaid
Long-term care
Medicare
Her group health plan - ✔✔Her group health plan
✔✔Medicare
is a disability program
is a hospital and medical expense insurance program
offers assistance in making health insurance premiums
Part D provides payment for surgeon expenses - ✔✔is a hospital and medical expense
insurance program
✔✔T owns an Accident & Health policy and notifies her insurance company that she
has chosen a less hazardous occupation. Under the Change of Occupation provision,
which of the following actions may her insurance company take?
Allow her to take a tax deduction on unearned premiums
Increase her policy's coverage amount
Decrease her policy's coverage amount
Nothing - ✔✔Increase her policy's coverage amount
✔✔All of the following statements about health coverage for newborns are correct
EXCEPT
coverage begins and benefits are payable from the moment of birth
coverage includes necessary care and treatment of congenital defects
coverage during the first year is limited to congenital defects
continued coverage after the first 31 days is dependent on notification - ✔✔coverage
during the first year is limited to congenital defects
