Pearson Vue Life Insurance Practice
Exam Questions and Answers | Latest
Version | 2025/2026 | Correct & Verified
Which type of life insurance provides coverage for a limited time only?
✔✔ A. Term life insurance
B. Whole life insurance
C. Universal life insurance
D. Variable life insurance
A policy that builds cash value and provides lifetime protection is called:
A. Term life
✔✔ B. Whole life
C. Level benefit
D. Credit life
What is the main benefit of naming a contingent beneficiary?
A. It increases the death benefit
✔✔ B. It ensures someone receives the benefit if the primary beneficiary dies
1
,C. It doubles the coverage amount
D. It removes the need for a policyholder
What does insurable interest mean in life insurance?
✔✔ A. The policyholder must benefit financially from the insured’s survival
B. The insurer must be government-approved
C. The insured must have two policies
D. The policyholder must live with the insured
Which of the following policies allows the policyholder to invest in subaccounts?
A. Term life
B. Whole life
C. Universal life
✔✔ D. Variable life
A rider added to a life policy that waives premiums if the policyholder becomes disabled is
called:
✔✔ A. Waiver of premium rider
2
,B. Accelerated benefit rider
C. Guaranteed insurability rider
D. Return of premium rider
What happens if a policyholder fails to pay the premium during the grace period?
A. The policy is renewed
✔✔ B. The policy lapses
C. The premium is waived
D. The cash value doubles
Which of the following policies is best for temporary insurance needs?
A. Whole life
✔✔ B. Term life
C. Variable life
D. Universal life
What is the purpose of the incontestability clause in a life insurance policy?
✔✔ A. To prevent the insurer from voiding the policy after a certain time
3
, B. To allow the insured to cancel anytime
C. To increase premiums
D. To adjust the beneficiary
What is the primary function of the death benefit?
A. To grow investment portfolios
✔✔ B. To provide financial support to beneficiaries
C. To pay income taxes
D. To cover living expenses for the insured
What type of policy allows premium payments to be flexible?
A. Term life
✔✔ B. Universal life
C. Whole life
D. Endowment life
Which of the following best explains underwriting in life insurance?
A. Selling a policy to a new customer
4
Exam Questions and Answers | Latest
Version | 2025/2026 | Correct & Verified
Which type of life insurance provides coverage for a limited time only?
✔✔ A. Term life insurance
B. Whole life insurance
C. Universal life insurance
D. Variable life insurance
A policy that builds cash value and provides lifetime protection is called:
A. Term life
✔✔ B. Whole life
C. Level benefit
D. Credit life
What is the main benefit of naming a contingent beneficiary?
A. It increases the death benefit
✔✔ B. It ensures someone receives the benefit if the primary beneficiary dies
1
,C. It doubles the coverage amount
D. It removes the need for a policyholder
What does insurable interest mean in life insurance?
✔✔ A. The policyholder must benefit financially from the insured’s survival
B. The insurer must be government-approved
C. The insured must have two policies
D. The policyholder must live with the insured
Which of the following policies allows the policyholder to invest in subaccounts?
A. Term life
B. Whole life
C. Universal life
✔✔ D. Variable life
A rider added to a life policy that waives premiums if the policyholder becomes disabled is
called:
✔✔ A. Waiver of premium rider
2
,B. Accelerated benefit rider
C. Guaranteed insurability rider
D. Return of premium rider
What happens if a policyholder fails to pay the premium during the grace period?
A. The policy is renewed
✔✔ B. The policy lapses
C. The premium is waived
D. The cash value doubles
Which of the following policies is best for temporary insurance needs?
A. Whole life
✔✔ B. Term life
C. Variable life
D. Universal life
What is the purpose of the incontestability clause in a life insurance policy?
✔✔ A. To prevent the insurer from voiding the policy after a certain time
3
, B. To allow the insured to cancel anytime
C. To increase premiums
D. To adjust the beneficiary
What is the primary function of the death benefit?
A. To grow investment portfolios
✔✔ B. To provide financial support to beneficiaries
C. To pay income taxes
D. To cover living expenses for the insured
What type of policy allows premium payments to be flexible?
A. Term life
✔✔ B. Universal life
C. Whole life
D. Endowment life
Which of the following best explains underwriting in life insurance?
A. Selling a policy to a new customer
4
