AFIP - BASIC CERTIFICATION COURSE | ACTUAL EXAM
QUESTIONS | WITH ALL PASSED ANSWERS!! WITH
RATIONALES
Question 1
What is the primary purpose of the Armed Forces Insurance Provider (AFIP)
certification program?
A) To qualify individuals to serve in active military roles.
B) To ensure military personnel receive free insurance products.
C) To educate and certify individuals who advise military members on
insurance matters.
D) To regulate the pricing of all insurance products sold to service members.
E) To provide a pathway for veterans to enter the insurance industry.
Correct Answer: C) To educate and certify individuals who advise
military members on insurance matters.
Rationale: The AFIP certification program aims to ensure that
individuals advising military members and their families on
insurance products are knowledgeable about military culture,
benefits, and ethical considerations.
Question 2
Which U.S. government entity is primarily responsible for establishing
policies and regulations that govern the sale of insurance on military
installations?
A) Department of Veterans Affairs (VA)
B) Department of Labor (DOL)
C) Department of Defense (DoD)
D) Department of Homeland Security (DHS)
E) State Departments of Insurance
Correct Answer: C) Department of Defense (DoD)
Rationale: The Department of Defense (DoD) establishes policies and
regulations (such as DoD Instruction 1344.07) to protect service
,members from predatory insurance practices and govern insurance
sales on military installations.
Question 3
What does "SGLI" stand for in the context of military benefits?
A) Service Group Life Insurance
B) Servicemembers' Group Life Insurance
C) Standard Government Life Indemnity
D) State Guaranteed Life Insurance
E) Soldiers' General Life Initiative
Correct Answer: B) Servicemembers' Group Life Insurance
Rationale: SGLI is a low-cost term life insurance program for eligible
service members, offering financial protection to their beneficiaries.
Question 4
Which of the following is a key ethical principle for an AFIP-certified advisor
when dealing with service members?
A) Prioritizing personal commission over the client's needs.
B) Encouraging the purchase of the maximum possible coverage regardless
of need.
C) Always acting in the best interest of the service member and their family.
D) Withholding information about cheaper alternatives if a higher
commission product is available.
E) Disclosing only the positive aspects of an insurance policy.
Correct Answer: C) Always acting in the best interest of the service
member and their family.
Rationale: A core ethical responsibility for any financial advisor,
especially one dealing with service members, is to act with fiduciary
duty, placing the client's best interest first.
Question 5
A military member is about to deploy. What is a critical insurance concern for
this individual?
,A) Ensuring their home insurance covers deployment-related damage.
B) Reviewing and updating beneficiary designations on all policies.
C) Purchasing additional vehicle insurance for their deployed location.
D) Canceling existing life insurance policies to save money.
E) Reducing health insurance coverage during deployment.
Correct Answer: B) Reviewing and updating beneficiary designations
on all policies.
Rationale: Deployment is a critical time to ensure that beneficiary
designations are current and accurately reflect the service
member's wishes, as circumstances may have changed since initial
enrollment.
Question 6
What is the primary healthcare program for active duty service members and
their families?
A) Medicare
B) Medicaid
C) TRICARE
D) Affordable Care Act (ACA) plans
E) Civilian employer-sponsored health plans
Correct Answer: C) TRICARE
Rationale: TRICARE is the healthcare program for uniformed service
members, retirees, and their families worldwide.
Question 7
An AFIP advisor must understand the military pay system. Which component
of military pay is generally not subject to federal income tax?
A) Basic Pay
B) Basic Allowance for Housing (BAH)
C) Special Duty Pay
D) Incentive Pay
E) Reenlistment Bonuses
, Correct Answer: B) Basic Allowance for Housing (BAH)
Rationale: BAH (Basic Allowance for Housing) is a tax-free allowance
provided to service members to cover housing costs when
government housing is not provided.
Question 8
Which term refers to a service member who has completed their initial
enlistment and may or may not re-enlist, but is not yet retired?
A) Veteran
B) Retiree
C) Reservist
D) Separating service member
E) Active duty
Correct Answer: D) Separating service member
Rationale: A separating service member is one who is leaving active
duty, but has not yet met the requirements for retirement. This
group has unique financial and insurance needs.
Question 9
What is the purpose of "DoD Instruction 1344.07: Personal Commercial
Solicitation on DoD Installations"?
A) To authorize all types of commercial solicitation on military bases.
B) To strictly prohibit all commercial activities on military installations.
C) To regulate and establish rules for commercial solicitations, particularly
insurance, on military installations.
D) To promote specific insurance companies favored by the DoD.
E) To establish a direct insurance sales program for the military.
Correct Answer: C) To regulate and establish rules for commercial
solicitations, particularly insurance, on military installations.
Rationale: DoD Instruction 1344.07 is a key regulation that sets forth
the rules and restrictions for commercial solicitations, especially for
QUESTIONS | WITH ALL PASSED ANSWERS!! WITH
RATIONALES
Question 1
What is the primary purpose of the Armed Forces Insurance Provider (AFIP)
certification program?
A) To qualify individuals to serve in active military roles.
B) To ensure military personnel receive free insurance products.
C) To educate and certify individuals who advise military members on
insurance matters.
D) To regulate the pricing of all insurance products sold to service members.
E) To provide a pathway for veterans to enter the insurance industry.
Correct Answer: C) To educate and certify individuals who advise
military members on insurance matters.
Rationale: The AFIP certification program aims to ensure that
individuals advising military members and their families on
insurance products are knowledgeable about military culture,
benefits, and ethical considerations.
Question 2
Which U.S. government entity is primarily responsible for establishing
policies and regulations that govern the sale of insurance on military
installations?
A) Department of Veterans Affairs (VA)
B) Department of Labor (DOL)
C) Department of Defense (DoD)
D) Department of Homeland Security (DHS)
E) State Departments of Insurance
Correct Answer: C) Department of Defense (DoD)
Rationale: The Department of Defense (DoD) establishes policies and
regulations (such as DoD Instruction 1344.07) to protect service
,members from predatory insurance practices and govern insurance
sales on military installations.
Question 3
What does "SGLI" stand for in the context of military benefits?
A) Service Group Life Insurance
B) Servicemembers' Group Life Insurance
C) Standard Government Life Indemnity
D) State Guaranteed Life Insurance
E) Soldiers' General Life Initiative
Correct Answer: B) Servicemembers' Group Life Insurance
Rationale: SGLI is a low-cost term life insurance program for eligible
service members, offering financial protection to their beneficiaries.
Question 4
Which of the following is a key ethical principle for an AFIP-certified advisor
when dealing with service members?
A) Prioritizing personal commission over the client's needs.
B) Encouraging the purchase of the maximum possible coverage regardless
of need.
C) Always acting in the best interest of the service member and their family.
D) Withholding information about cheaper alternatives if a higher
commission product is available.
E) Disclosing only the positive aspects of an insurance policy.
Correct Answer: C) Always acting in the best interest of the service
member and their family.
Rationale: A core ethical responsibility for any financial advisor,
especially one dealing with service members, is to act with fiduciary
duty, placing the client's best interest first.
Question 5
A military member is about to deploy. What is a critical insurance concern for
this individual?
,A) Ensuring their home insurance covers deployment-related damage.
B) Reviewing and updating beneficiary designations on all policies.
C) Purchasing additional vehicle insurance for their deployed location.
D) Canceling existing life insurance policies to save money.
E) Reducing health insurance coverage during deployment.
Correct Answer: B) Reviewing and updating beneficiary designations
on all policies.
Rationale: Deployment is a critical time to ensure that beneficiary
designations are current and accurately reflect the service
member's wishes, as circumstances may have changed since initial
enrollment.
Question 6
What is the primary healthcare program for active duty service members and
their families?
A) Medicare
B) Medicaid
C) TRICARE
D) Affordable Care Act (ACA) plans
E) Civilian employer-sponsored health plans
Correct Answer: C) TRICARE
Rationale: TRICARE is the healthcare program for uniformed service
members, retirees, and their families worldwide.
Question 7
An AFIP advisor must understand the military pay system. Which component
of military pay is generally not subject to federal income tax?
A) Basic Pay
B) Basic Allowance for Housing (BAH)
C) Special Duty Pay
D) Incentive Pay
E) Reenlistment Bonuses
, Correct Answer: B) Basic Allowance for Housing (BAH)
Rationale: BAH (Basic Allowance for Housing) is a tax-free allowance
provided to service members to cover housing costs when
government housing is not provided.
Question 8
Which term refers to a service member who has completed their initial
enlistment and may or may not re-enlist, but is not yet retired?
A) Veteran
B) Retiree
C) Reservist
D) Separating service member
E) Active duty
Correct Answer: D) Separating service member
Rationale: A separating service member is one who is leaving active
duty, but has not yet met the requirements for retirement. This
group has unique financial and insurance needs.
Question 9
What is the purpose of "DoD Instruction 1344.07: Personal Commercial
Solicitation on DoD Installations"?
A) To authorize all types of commercial solicitation on military bases.
B) To strictly prohibit all commercial activities on military installations.
C) To regulate and establish rules for commercial solicitations, particularly
insurance, on military installations.
D) To promote specific insurance companies favored by the DoD.
E) To establish a direct insurance sales program for the military.
Correct Answer: C) To regulate and establish rules for commercial
solicitations, particularly insurance, on military installations.
Rationale: DoD Instruction 1344.07 is a key regulation that sets forth
the rules and restrictions for commercial solicitations, especially for
