ARKANSAS LIFE INSURANCE EXAM
LATEST ACTUAL STUDY QUESTIONS
AND ANSWERS
Ordinary Life - ANSWER-Individual life insurance that includes many types of
temporary and permanent insurance protection plans written as individuals
Term Life - ANSWER-Provides low cost insurance protection for a specified
period (or term) and pays a benefit only if the insured dies during that period
Term Life - ANSWER-The initial premium is lower than for an equivalent
amount of whole life insurance
Level Term - ANSWER-Insurance provides a level amount of protection for a
specified period, after which the policy expires
Decreasing Term - ANSWER-Polices are characterized by benefit amounts
that decrease gradually over the term of protection and have level premiums
Decreasing Term - ANSWER-Commonly used to protect an insured's mortgage
Credit Life - ANSWER-Sold to cover the outstanding balance on a loan, is
based on decreasing term insurance
Increasing Term - ANSWER-Usually stated as specific amounts or as a
percentage of the original amount
Increasing Term - ANSWER-Insurance may be sold as a separate policy, but is
usually purchased as a cost of living rider to a policy
Term Life - ANSWER-Policies are issued for a specified period, defined in
terms of years or age
Renewable - ANSWER-The premiums for the renewal period will be higher
than the initial premium
Conversion - ANSWER-The option to convert gives the insured the right to
convert or exchange their term policy for a whole life plan without evidence
of insurability
Whole Life - ANSWER-Insurance is called this because it provides permanent
protection for one's entire life-from the date of issue to the date of the
insured's death
Whole Life - ANSWER-Cash values and maturity at age 100
, Cash Value - ANSWER-Builds over the life of the policy. This is because whole
life insurance plans are credited with a certain guaranteed rate of interest.
Cash Value - ANSWER-Often regarded as a savings element because it
represents the amount of money the policyowner will receive if the policy is
ever surrendered
Whole Life Premiums - ANSWER-The shorter the payment period, the higher
the premium.
Whole Life Premiums - ANSWER-This approach allows whole life insurance
premiums to remain level rather than increase each year with the insured's
age
Straight Whole Life - ANSWER-Whole life insurance providing permanent level
protection with level premiums from the time the policy is issued until the
insured's death
Limit Pay Whole Life - ANSWER-Have level premiums that are limited to a
specified number of years
Limited Pay Whole Life - ANSWER-This type of coverage would best suit a
prospective insured who desires permanent insurance but does not want to
pay premiums indefinitely.
Single -premium Whole Life - ANSWER-Coverage is completely paid for the
full life of the policy
Premium Periods - ANSWER-The length of the premium-paying period also
affects the growth of the policy's cash value
Premium Periods - ANSWER-The longer the premium payments the slower the
cash value grows
Modified Whole Life - ANSWER-Premiums that are lower than typical whole
life premiums during the first few years and then higher than typical
thereafter
Equity Index Whole Life - ANSWER-80% to 90% of the premium is invested in
traditional fixed income securities and the remainder of the premium is
invested in contracts tied to a stipulated stock index
Graded Premium Whole Life - ANSWER-Premiums are lower than typical
whole life rates during the preliminary period after the policy is issued. The
premiums will initially increase yearly during the preliminary period then
remain level afterwards
LATEST ACTUAL STUDY QUESTIONS
AND ANSWERS
Ordinary Life - ANSWER-Individual life insurance that includes many types of
temporary and permanent insurance protection plans written as individuals
Term Life - ANSWER-Provides low cost insurance protection for a specified
period (or term) and pays a benefit only if the insured dies during that period
Term Life - ANSWER-The initial premium is lower than for an equivalent
amount of whole life insurance
Level Term - ANSWER-Insurance provides a level amount of protection for a
specified period, after which the policy expires
Decreasing Term - ANSWER-Polices are characterized by benefit amounts
that decrease gradually over the term of protection and have level premiums
Decreasing Term - ANSWER-Commonly used to protect an insured's mortgage
Credit Life - ANSWER-Sold to cover the outstanding balance on a loan, is
based on decreasing term insurance
Increasing Term - ANSWER-Usually stated as specific amounts or as a
percentage of the original amount
Increasing Term - ANSWER-Insurance may be sold as a separate policy, but is
usually purchased as a cost of living rider to a policy
Term Life - ANSWER-Policies are issued for a specified period, defined in
terms of years or age
Renewable - ANSWER-The premiums for the renewal period will be higher
than the initial premium
Conversion - ANSWER-The option to convert gives the insured the right to
convert or exchange their term policy for a whole life plan without evidence
of insurability
Whole Life - ANSWER-Insurance is called this because it provides permanent
protection for one's entire life-from the date of issue to the date of the
insured's death
Whole Life - ANSWER-Cash values and maturity at age 100
, Cash Value - ANSWER-Builds over the life of the policy. This is because whole
life insurance plans are credited with a certain guaranteed rate of interest.
Cash Value - ANSWER-Often regarded as a savings element because it
represents the amount of money the policyowner will receive if the policy is
ever surrendered
Whole Life Premiums - ANSWER-The shorter the payment period, the higher
the premium.
Whole Life Premiums - ANSWER-This approach allows whole life insurance
premiums to remain level rather than increase each year with the insured's
age
Straight Whole Life - ANSWER-Whole life insurance providing permanent level
protection with level premiums from the time the policy is issued until the
insured's death
Limit Pay Whole Life - ANSWER-Have level premiums that are limited to a
specified number of years
Limited Pay Whole Life - ANSWER-This type of coverage would best suit a
prospective insured who desires permanent insurance but does not want to
pay premiums indefinitely.
Single -premium Whole Life - ANSWER-Coverage is completely paid for the
full life of the policy
Premium Periods - ANSWER-The length of the premium-paying period also
affects the growth of the policy's cash value
Premium Periods - ANSWER-The longer the premium payments the slower the
cash value grows
Modified Whole Life - ANSWER-Premiums that are lower than typical whole
life premiums during the first few years and then higher than typical
thereafter
Equity Index Whole Life - ANSWER-80% to 90% of the premium is invested in
traditional fixed income securities and the remainder of the premium is
invested in contracts tied to a stipulated stock index
Graded Premium Whole Life - ANSWER-Premiums are lower than typical
whole life rates during the preliminary period after the policy is issued. The
premiums will initially increase yearly during the preliminary period then
remain level afterwards
