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FINAL EXAM: CALIFORNIA LIFE,
ACCIDENT, AND HEALTH
INSURANCE QUESTIONS AND ANSWERS
2025
What distinguishes a deferred annuity from an immediate
annuity? - correct answer- The time at which benefit payments
start
Cindy buys a 10-year certain annuity with an installment refund.
After receiving monthly payments for 5 years, Cindy dies. How
many remaining payments will the insurer make to her
beneficiary? - correct answer- 60 payments
What is a common reason people purchase an annuity? -
correct answer- To protect against the risk of outliving their
financial resources
What kind of annuity pays income to two annuitants until their
deaths? - correct answer- Joint and survivor annuity
What is a joint and survivor annuity? - correct answer- Provides
payments the annuity to two people. If either person dies, the
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same income payments continue to the survivor for life. When
the surviving annuitant dies, no further payments are made to
anyone.
Victoria owns a life annuity and elects to receive annuity
payments monthly for the remainder of her life with "ten years
certain". Her annuity will make payments - correct answer- for a
minimum of 120 months and a maximum of the remainder of
her life
Which of the following statements regarding a life insurance
policy dividend is TRUE? - correct answer- It is the distribution
of excess of funds accumulated by the insurer on participating
policies.
An insured owned by its policyholders is called a - correct
answer- mutual insurer
An insurer enters into a contract with a third party to insure
itself against losses from insurance policies it issues. What is
the agreement called? - correct answer- Reinsurance
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What is reinsurance? - correct answer- An arrangement by
which an insurance company transfers a portion of a risk it has
assumed to another insurer
Which of the following is NOT a characteristic of reinsurance? -
correct answer- Increases the unearned premium reserve
Which of the following is a contract that involves one party
which indemnifies another when a loss arises from an unknown
event? - correct answer- Insurance policy
What is an insurance policy? - correct answer- A contract where
one party promises to indemnify another against loss that
arises from an unknown event
What is residual disability income insurance payments based
on? - correct answer- The amount of the insured's income is
reduced by the disability
Manuel is considered to be a disabled person as defined by the
Americans with Disabilities Act (ADA). As such, he is unable to
perform any of the following life activities EXCEPT - correct
answer- Driving
FINAL EXAM: CALIFORNIA LIFE,
ACCIDENT, AND HEALTH
INSURANCE QUESTIONS AND ANSWERS
2025
What distinguishes a deferred annuity from an immediate
annuity? - correct answer- The time at which benefit payments
start
Cindy buys a 10-year certain annuity with an installment refund.
After receiving monthly payments for 5 years, Cindy dies. How
many remaining payments will the insurer make to her
beneficiary? - correct answer- 60 payments
What is a common reason people purchase an annuity? -
correct answer- To protect against the risk of outliving their
financial resources
What kind of annuity pays income to two annuitants until their
deaths? - correct answer- Joint and survivor annuity
What is a joint and survivor annuity? - correct answer- Provides
payments the annuity to two people. If either person dies, the
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same income payments continue to the survivor for life. When
the surviving annuitant dies, no further payments are made to
anyone.
Victoria owns a life annuity and elects to receive annuity
payments monthly for the remainder of her life with "ten years
certain". Her annuity will make payments - correct answer- for a
minimum of 120 months and a maximum of the remainder of
her life
Which of the following statements regarding a life insurance
policy dividend is TRUE? - correct answer- It is the distribution
of excess of funds accumulated by the insurer on participating
policies.
An insured owned by its policyholders is called a - correct
answer- mutual insurer
An insurer enters into a contract with a third party to insure
itself against losses from insurance policies it issues. What is
the agreement called? - correct answer- Reinsurance
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What is reinsurance? - correct answer- An arrangement by
which an insurance company transfers a portion of a risk it has
assumed to another insurer
Which of the following is NOT a characteristic of reinsurance? -
correct answer- Increases the unearned premium reserve
Which of the following is a contract that involves one party
which indemnifies another when a loss arises from an unknown
event? - correct answer- Insurance policy
What is an insurance policy? - correct answer- A contract where
one party promises to indemnify another against loss that
arises from an unknown event
What is residual disability income insurance payments based
on? - correct answer- The amount of the insured's income is
reduced by the disability
Manuel is considered to be a disabled person as defined by the
Americans with Disabilities Act (ADA). As such, he is unable to
perform any of the following life activities EXCEPT - correct
answer- Driving
