ALABAMA LIFE INSURANCE LICENSING
EXAMINATION TEST 2026 COMPLETE
STUDY GUIDE AND SOLUTIONS
◉ What is the purpose of insurance guaranty associations?
Answer: to protect policy owners, insureds, and beneficiaries from
financial losses caused by insolvent insurers
◉ Which of the following is true about a defined benefit plan?
Answer: High-salaried employees with only a few years until
retirement receive the highest contribution.
◉ The insured had his wife named as the beneficiary of his life
insurance policy. To ensure that his wife had income for life after the
insured's death, he chose the life income settlement option. The
amount of payments will be determined by taking into account all of
the following EXCEPT
Answer: The insureds age at death
◉ All of the following entities regulate variable life policies EXCEPT
Answer: The Guaranty Association
, ◉ When the insurer stipulates the time period for payment of
claims, how soon must the insurer pay a death benefit claim after
receiving the proof of death?
Answer: 2 months
◉ The two types of assignments are
Answer: Absolute and Collateral
◉ Which of the following policies would have an IRS required
corridor or gap between the cash value and the death benefit?
Answer: Universal Life Option A
◉ When would a 20-pay whole life policy endow?
Answer: When the insured reaches age 100
◉ What is the advantage of reinstating a policy instead of applying
for a new one?
Answer: the original age is used for premium determination
◉ An insured has a continuous premium whole life policy. She would
like to use the policy dividends to pay off her policy sooner than
would have been possible otherwise. What dividend option could
she use?
EXAMINATION TEST 2026 COMPLETE
STUDY GUIDE AND SOLUTIONS
◉ What is the purpose of insurance guaranty associations?
Answer: to protect policy owners, insureds, and beneficiaries from
financial losses caused by insolvent insurers
◉ Which of the following is true about a defined benefit plan?
Answer: High-salaried employees with only a few years until
retirement receive the highest contribution.
◉ The insured had his wife named as the beneficiary of his life
insurance policy. To ensure that his wife had income for life after the
insured's death, he chose the life income settlement option. The
amount of payments will be determined by taking into account all of
the following EXCEPT
Answer: The insureds age at death
◉ All of the following entities regulate variable life policies EXCEPT
Answer: The Guaranty Association
, ◉ When the insurer stipulates the time period for payment of
claims, how soon must the insurer pay a death benefit claim after
receiving the proof of death?
Answer: 2 months
◉ The two types of assignments are
Answer: Absolute and Collateral
◉ Which of the following policies would have an IRS required
corridor or gap between the cash value and the death benefit?
Answer: Universal Life Option A
◉ When would a 20-pay whole life policy endow?
Answer: When the insured reaches age 100
◉ What is the advantage of reinstating a policy instead of applying
for a new one?
Answer: the original age is used for premium determination
◉ An insured has a continuous premium whole life policy. She would
like to use the policy dividends to pay off her policy sooner than
would have been possible otherwise. What dividend option could
she use?
