INDIANA LIFE AND HEALTH INSURANCE
EXAM QUESTIONS AND CORRECT
DETAILED ANSWERS 2025 (VERIFIED
ANSWERS) PLUS RATIONALES
1. Which of the following is NOT a requirement for an insurance contract to
be valid?
A) Offer and acceptance
B) Consideration
C) Mutual mistake
D) Legal purpose
Mutual mistake is not a requirement; contracts require offer, acceptance,
consideration, and legal purpose.
2. What type of insurance policy provides coverage for a specified term and
pays a death benefit only if the insured dies during that term?
A) Whole life insurance
B) Universal life insurance
, C) Term life insurance
D) Endowment policy
Term life insurance covers a fixed period and pays only if death occurs
within that period.
3. Which provision in a health insurance policy specifies the insured’s duties in
the event of a loss?
A) Insuring clause
B) Notice of claim
C) Grace period
D) Consideration clause
The Notice of Claim provision requires the insured to notify the insurer of
a loss within a certain time frame.
4. In Indiana, the free-look period for individual life insurance policies is:
A) 7 days
B) 10 days
C) 15 days
D) 30 days
Indiana law requires a 15-day free-look period allowing the policyowner
to return the policy for a full refund.
5. What does the “consideration” in an insurance contract refer to?
A) The premium paid and statements made by the insured
, B) The insurer’s promise to pay claims
C) The policyowner’s beneficiary designation
D) The insurer’s underwriting guidelines
Consideration includes what the insured gives (premium, statements) and
what the insurer promises (coverage).
6. Which of the following is NOT a characteristic of a health maintenance
organization (HMO)?
A) Requires members to use network providers
B) Emphasizes preventive care
C) Pays on a fee-for-service basis
D) Provides coordinated care through primary care physicians
HMOs typically use a prepaid system rather than fee-for-service payment.
7. Which type of life insurance policy builds cash value on a tax-deferred
basis?
A) Term life insurance
B) Whole life insurance
C) Health insurance
D) Disability income insurance
Whole life policies accumulate cash value over time on a tax-deferred
basis.
EXAM QUESTIONS AND CORRECT
DETAILED ANSWERS 2025 (VERIFIED
ANSWERS) PLUS RATIONALES
1. Which of the following is NOT a requirement for an insurance contract to
be valid?
A) Offer and acceptance
B) Consideration
C) Mutual mistake
D) Legal purpose
Mutual mistake is not a requirement; contracts require offer, acceptance,
consideration, and legal purpose.
2. What type of insurance policy provides coverage for a specified term and
pays a death benefit only if the insured dies during that term?
A) Whole life insurance
B) Universal life insurance
, C) Term life insurance
D) Endowment policy
Term life insurance covers a fixed period and pays only if death occurs
within that period.
3. Which provision in a health insurance policy specifies the insured’s duties in
the event of a loss?
A) Insuring clause
B) Notice of claim
C) Grace period
D) Consideration clause
The Notice of Claim provision requires the insured to notify the insurer of
a loss within a certain time frame.
4. In Indiana, the free-look period for individual life insurance policies is:
A) 7 days
B) 10 days
C) 15 days
D) 30 days
Indiana law requires a 15-day free-look period allowing the policyowner
to return the policy for a full refund.
5. What does the “consideration” in an insurance contract refer to?
A) The premium paid and statements made by the insured
, B) The insurer’s promise to pay claims
C) The policyowner’s beneficiary designation
D) The insurer’s underwriting guidelines
Consideration includes what the insured gives (premium, statements) and
what the insurer promises (coverage).
6. Which of the following is NOT a characteristic of a health maintenance
organization (HMO)?
A) Requires members to use network providers
B) Emphasizes preventive care
C) Pays on a fee-for-service basis
D) Provides coordinated care through primary care physicians
HMOs typically use a prepaid system rather than fee-for-service payment.
7. Which type of life insurance policy builds cash value on a tax-deferred
basis?
A) Term life insurance
B) Whole life insurance
C) Health insurance
D) Disability income insurance
Whole life policies accumulate cash value over time on a tax-deferred
basis.
