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Alabama life and health Questions with
Detailed Verified Answers (100% Correct
Answers) /Already Graded A+
Billy is the owner of a life insurance policy and has chosen a policy settlement
option under which the company will pay the beneficiary (his widow) an income
each month for as long as she lives. Payment stops at her death. Which
settlement option has Billy selected?
A. Fixed amount option
B. Fixed period option
C. Interest only option
D. Life income option
Ans: D. Life income option
A man with an Accidental Death & Dismemberment (AD&D) policy having a
Principal Sum of $100,000 and a Capital Sum of $50,000 loses a leg due to a
blood clot which was not due to an accident. The policy will pay
A. $0
Your Answer
B. $50,000
C. $100,000
D. $150,000
Ans: 0
According to Required Health Policy Provisions, the insured is prevented from
filing suit against the insurer for at least
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A. 20 days and not longer than one year from the date of proof of loss.
B. 30 days and not longer than three years from the date of proof of loss.
C. 60 days and not longer than three years from the date of proof of loss.
D. 90 days and not longer than five years from the date of proof of loss.
Ans: 60 days
The fact that insurance is more likely to be purchased by people who expect to
experience a loss is known as
A. the law of large numbers.
B. estoppel.
C. adverse selection.
D. the risk selection process.
Ans: adverse selection
If Louise allows her whole life policy to lapse, which nonforfeiture option should
she elect to obtain the most life insurance protection?
A. Cash surrender value option
B. Reduced paid-up insurance option
C. Guaranteed monthly income option
D. Extended term option
Ans: extended term option
the kind of life insurance that acquires no cash value is
A. variable life.
B. whole life.
C. term life.
D. universal life.
Ans: term life
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If administrative action is taken against you, or you are criminally prosecuted in
another jurisdiction, you have how long to submit notice to the Alabama
Commissioner?
A. 30 days
B. 60 days
C. The end of the license period
D. Immediately
Ans: 30 days
An immediate annuity with quarterly payments will begin making payments
A. 1 month after the annuity is purchased.
B. 3 months after the annuity is purchased.
C. 6 months after the annuity is purchased.
D. 1 year after the annuity is purchased.
Ans: . 3 months after the annuity is purchased.
A disability income policy typically covers
A. the children but not the parents.
B. the parents but not the children.
C. every member of the family.
D. just the wage earners.
Ans: just wage earners
All of the following would likely be eligible for group life insurance EXCEPT:
A. all the uninsured residents of the Golden Years Nursing Home.
B. all the state's public school teachers.
C. employees of a nuclear power plant.
D. members of a coal miner's union.
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Ans: all the uninsured residents of the golden years nursing home
If the consideration clause states that the premium payment keeps the policy in
force until the next premium is due plus 30 days thereafter, the policy
A. is not authorized to be sold in most states.
B. must be modified only by an authorized agent of the company.
C. contains a grace period.
D. must be approved by an officer of the company.
Ans: contains a grace period
The settlement option under which the principal never decreases unless the
beneficiary makes withdrawals is the
A. interest only option.
B. fixed period option.
C. fixed amount option.
D. life income option.
Ans: interest only option
Dividend options are defined as ways in which the policyowner can:
A. pay taxes on insurance dividends.
B. use or collect policy dividends.
C. pay the loan against the policy.
D. receive dividends paid on any stock held.
Ans: use or collect policy dividends.
The legal doctrine that prevents one from exercising a right of privilege is called
A. aleatory.
B. estoppel.
C. unilateral.
D. waiver.
Click here for more: Preppass - Stuvia
Alabama life and health Questions with
Detailed Verified Answers (100% Correct
Answers) /Already Graded A+
Billy is the owner of a life insurance policy and has chosen a policy settlement
option under which the company will pay the beneficiary (his widow) an income
each month for as long as she lives. Payment stops at her death. Which
settlement option has Billy selected?
A. Fixed amount option
B. Fixed period option
C. Interest only option
D. Life income option
Ans: D. Life income option
A man with an Accidental Death & Dismemberment (AD&D) policy having a
Principal Sum of $100,000 and a Capital Sum of $50,000 loses a leg due to a
blood clot which was not due to an accident. The policy will pay
A. $0
Your Answer
B. $50,000
C. $100,000
D. $150,000
Ans: 0
According to Required Health Policy Provisions, the insured is prevented from
filing suit against the insurer for at least
,Page | 2
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A. 20 days and not longer than one year from the date of proof of loss.
B. 30 days and not longer than three years from the date of proof of loss.
C. 60 days and not longer than three years from the date of proof of loss.
D. 90 days and not longer than five years from the date of proof of loss.
Ans: 60 days
The fact that insurance is more likely to be purchased by people who expect to
experience a loss is known as
A. the law of large numbers.
B. estoppel.
C. adverse selection.
D. the risk selection process.
Ans: adverse selection
If Louise allows her whole life policy to lapse, which nonforfeiture option should
she elect to obtain the most life insurance protection?
A. Cash surrender value option
B. Reduced paid-up insurance option
C. Guaranteed monthly income option
D. Extended term option
Ans: extended term option
the kind of life insurance that acquires no cash value is
A. variable life.
B. whole life.
C. term life.
D. universal life.
Ans: term life
,Page | 3
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If administrative action is taken against you, or you are criminally prosecuted in
another jurisdiction, you have how long to submit notice to the Alabama
Commissioner?
A. 30 days
B. 60 days
C. The end of the license period
D. Immediately
Ans: 30 days
An immediate annuity with quarterly payments will begin making payments
A. 1 month after the annuity is purchased.
B. 3 months after the annuity is purchased.
C. 6 months after the annuity is purchased.
D. 1 year after the annuity is purchased.
Ans: . 3 months after the annuity is purchased.
A disability income policy typically covers
A. the children but not the parents.
B. the parents but not the children.
C. every member of the family.
D. just the wage earners.
Ans: just wage earners
All of the following would likely be eligible for group life insurance EXCEPT:
A. all the uninsured residents of the Golden Years Nursing Home.
B. all the state's public school teachers.
C. employees of a nuclear power plant.
D. members of a coal miner's union.
, Page | 4
Click here for more: Preppass - Stuvia
Ans: all the uninsured residents of the golden years nursing home
If the consideration clause states that the premium payment keeps the policy in
force until the next premium is due plus 30 days thereafter, the policy
A. is not authorized to be sold in most states.
B. must be modified only by an authorized agent of the company.
C. contains a grace period.
D. must be approved by an officer of the company.
Ans: contains a grace period
The settlement option under which the principal never decreases unless the
beneficiary makes withdrawals is the
A. interest only option.
B. fixed period option.
C. fixed amount option.
D. life income option.
Ans: interest only option
Dividend options are defined as ways in which the policyowner can:
A. pay taxes on insurance dividends.
B. use or collect policy dividends.
C. pay the loan against the policy.
D. receive dividends paid on any stock held.
Ans: use or collect policy dividends.
The legal doctrine that prevents one from exercising a right of privilege is called
A. aleatory.
B. estoppel.
C. unilateral.
D. waiver.
