2026 Colorado Life Insurance Exam
Questions with Verified Answers 2026
The term insurance transaction includes: - CORRECT ANSWER -
1) Solicitation; 2) Negotiation; 3) Sales; 4) Advertising
Adverse Selection (insurance def) - CORRECT ANSWER -
Insuring the risks that are more prone to losses than the average risk
Agent/Producer - CORRECT ANSWER -
a legal representative of an insurance company; the classification of producer usually includes agents a
nd brokers; agents are the agents of the insurer
Applicant or proposed insured - CORRECT ANSWER -a person applying for insurance
Beneficiary - CORRECT ANSWER -A person who receives the benefits of an insurance policy
Death Benefit - CORRECT ANSWER -
the amount paid upon the death of the insured in a life insurance policy
insurance policy - CORRECT ANSWER -
a contract between a policyowner (and/or insured) and an insurance company which agrees to pay the
insured or the beneficiary for loss caused by specific events
Insured - CORRECT ANSWER -
person covered by the insurance policy; may or may not be the policy owner
Insurer (principal) - CORRECT ANSWER -the company who issues an insurance policy
lapse - CORRECT ANSWER -policy termination due to nonpayment of premium
Policyowner - CORRECT ANSWER -the person entitled to exercise the rights and privileges in the policy
, Agent Authority - CORRECT ANSWER -express, implied, apparent
Express Authorityc-cCORRECTcANSWERc-authoritycdeclaredcincclear,c direct,candcdefinitecterms
ImpliedcAuthorityc-cCORRECTcANSWERc-
Authoritycthatciscnotcexpressedcorcwrittencintoc theccontract,cbutcwhichcthecagentciscassumedctoc haveci
n
orderctoctransactcthecbusinesscofcinsurancecforc thecprincipal.
ApparentcAuthorityc-cCORRECTcANSWERc-
Thecappearancecorcthecassumptioncofcauthoritycbasedconcthecactions,cwords,corcdeedscofcthecprincipalc
o
rcbecausecofccircumstancescthecprincipalccreated.
ElementscofcacLegalcContractc-cCORRECTcANSWERc-
Agreementc(offercandcacceptance),cconsideration,ccompetentcparties,candclegalcpurpose
AleatorycContractc-cCORRECTcANSWERc-Thecexchangecofcvalueciscunequal.
adhesionccontractc-cCORRECTcANSWERc-Actake-it-or-leave-
itcoffercmadecbyc acpartycwhocholdscmostcofcthecpowercincacbargainingcsessio
n
UnilateralcContractc-cCORRECTcANSWERc-promisecincexchangecforc ancactc-cacone-sidedcpromise
ConditionalcContractc-cCORRECTcANSWERc-
accontractcthatcbecomescenforceableconlyconcthechappeningcorcterminationcofcacspecifiedccondition
ApplicationcStatementc-cWarrantyc -cCORRECTcANSWERc-Acabsolutelyctruecstatement
ApplicationcStatementc-cRepresentationsc-cCORRECTcANSWERc-
Truec toc thecbestcofcthecapplicantscknowledge
Questions with Verified Answers 2026
The term insurance transaction includes: - CORRECT ANSWER -
1) Solicitation; 2) Negotiation; 3) Sales; 4) Advertising
Adverse Selection (insurance def) - CORRECT ANSWER -
Insuring the risks that are more prone to losses than the average risk
Agent/Producer - CORRECT ANSWER -
a legal representative of an insurance company; the classification of producer usually includes agents a
nd brokers; agents are the agents of the insurer
Applicant or proposed insured - CORRECT ANSWER -a person applying for insurance
Beneficiary - CORRECT ANSWER -A person who receives the benefits of an insurance policy
Death Benefit - CORRECT ANSWER -
the amount paid upon the death of the insured in a life insurance policy
insurance policy - CORRECT ANSWER -
a contract between a policyowner (and/or insured) and an insurance company which agrees to pay the
insured or the beneficiary for loss caused by specific events
Insured - CORRECT ANSWER -
person covered by the insurance policy; may or may not be the policy owner
Insurer (principal) - CORRECT ANSWER -the company who issues an insurance policy
lapse - CORRECT ANSWER -policy termination due to nonpayment of premium
Policyowner - CORRECT ANSWER -the person entitled to exercise the rights and privileges in the policy
, Agent Authority - CORRECT ANSWER -express, implied, apparent
Express Authorityc-cCORRECTcANSWERc-authoritycdeclaredcincclear,c direct,candcdefinitecterms
ImpliedcAuthorityc-cCORRECTcANSWERc-
Authoritycthatciscnotcexpressedcorcwrittencintoc theccontract,cbutcwhichcthecagentciscassumedctoc haveci
n
orderctoctransactcthecbusinesscofcinsurancecforc thecprincipal.
ApparentcAuthorityc-cCORRECTcANSWERc-
Thecappearancecorcthecassumptioncofcauthoritycbasedconcthecactions,cwords,corcdeedscofcthecprincipalc
o
rcbecausecofccircumstancescthecprincipalccreated.
ElementscofcacLegalcContractc-cCORRECTcANSWERc-
Agreementc(offercandcacceptance),cconsideration,ccompetentcparties,candclegalcpurpose
AleatorycContractc-cCORRECTcANSWERc-Thecexchangecofcvalueciscunequal.
adhesionccontractc-cCORRECTcANSWERc-Actake-it-or-leave-
itcoffercmadecbyc acpartycwhocholdscmostcofcthecpowercincacbargainingcsessio
n
UnilateralcContractc-cCORRECTcANSWERc-promisecincexchangecforc ancactc-cacone-sidedcpromise
ConditionalcContractc-cCORRECTcANSWERc-
accontractcthatcbecomescenforceableconlyconcthechappeningcorcterminationcofcacspecifiedccondition
ApplicationcStatementc-cWarrantyc -cCORRECTcANSWERc-Acabsolutelyctruecstatement
ApplicationcStatementc-cRepresentationsc-cCORRECTcANSWERc-
Truec toc thecbestcofcthecapplicantscknowledge
