Pearson VUE Casualty Insurance Practice Test |
100% Verified Correct Answers | A+ Graded |
New 2025/2026 Edition
1. The principle of actual cash value is applied to claims for which of the
following policies?
A. Accidental Death
B. Auto Physical Damage
C. Variable Annuity
D. Workers' Compensation - ANSWER B
2. In a Commercial General Liability policy, medical payment expenses MUST
be:
A. caused by the negligence of the insured
B. caused by a product manufactured by the insured
C. reported within one year of the date of the accident
D. reported within two years of the policy expiration - ANSWER C
3. Actual cash value is most often defined as:
A. replacement cost less depreciation
B. original purchase price less depreciation
C. stated amount a policy will pay
D. cost to replace - ANSWER A
1
,4. Under the social security retirement benefits, all of the following factors will
influence how much a retiring individual will receive as a monthly income
benefit except the individual's - ANSWER Sex
5. In life insurance, insurance interest must exist at the time the - ANSWER
Producer writes an application on a proposed insured
6. Which of the following statements is NOT correct about representations? -
ANSWER They are true in every respect
7. An insurance producer takes an application for a life insurance policy but
does not collect the initial premium. On delivery of the policy to the
proposed insured, the producer must collect the initial premium and which
of the following? - ANSWER The insured's signed statement of continued
good health
8. Which of the following retirement plans is tax-qualified? - ANSWER
Defined contribution
9. Which of the following statements is correct about the paid-up additions in a
participating whole life policy? - ANSWER They are purchased on an
attained age basis
10.The right to change a beneficiary designation is reserved for the: -
ANSWER Policyowner
11.Which of the following provisions in a life policy specifies the manner in
which proceeds will be paid to a beneficiary on the death of the insured? -
ANSWER Settlement options
12.Two business partners own life insurance on each other. If one partner dies,
which of the following contracts will allow the other partner to buy 100
percent of the business interest? - ANSWER buy-sell agreement
13.The waiver of premium provision of a life policy allows the insurer to take
which of the following actions? - ANSWER waive an insured's premiums if
the insured becomes totally disabled before a certian age
14.A life insurance application is incomplete if it is missing the signature of
which of the following? - ANSWER The proposed adult insured
2
, 15.Which of the following statements is correct about group life conversion
privileges? - ANSWER Death during the conversion period is covered if the
departing employee chose not to conver the policy.
16.In the event of an insured's death, which of the following provides an
income for the family during a designated period of time followed by a lump
sum death benefit? - ANSWER Family income rider
17.A policyowner names his wife as the primary beneficiary of his Universal
Life policy on a revocable basis. He also names his three children as his
secondary beneficiaries and his estate as his tertiary beneficiary. If the
policyowner's wife predeceases him, and then he dies, who will receive the
policy proceeds? - ANSWER children
18.A contract that has as its basic function the systematic liquidation of
accumulated assets through periodic payments is called an - ANSWER
annuity
19.All of the following policies may be examples of third party ownership
except - ANSWER Modified Life
Group Life
Split-dollar Life
Key Employee Life
Modified Life
20.Which of the following group life plan requires at least 75 percent of the
eligible members to participate? - ANSWER Contributory
21.Which of the following features allows an insurance policy to remain in
force for a specified number of days beyond the premium due date? -
ANSWER Grace period provision
22.In which of the following contracts is the death benefit called the principal
sum? - ANSWER Accidental Death and Dismemberment (AD&D)
23.The primary reason for selecting a variable whole life policy instead of a
traditional whole life policy is that the variable whole life policy - ANSWER
Has the potential to earn a higher rate of return on the cash value
3
100% Verified Correct Answers | A+ Graded |
New 2025/2026 Edition
1. The principle of actual cash value is applied to claims for which of the
following policies?
A. Accidental Death
B. Auto Physical Damage
C. Variable Annuity
D. Workers' Compensation - ANSWER B
2. In a Commercial General Liability policy, medical payment expenses MUST
be:
A. caused by the negligence of the insured
B. caused by a product manufactured by the insured
C. reported within one year of the date of the accident
D. reported within two years of the policy expiration - ANSWER C
3. Actual cash value is most often defined as:
A. replacement cost less depreciation
B. original purchase price less depreciation
C. stated amount a policy will pay
D. cost to replace - ANSWER A
1
,4. Under the social security retirement benefits, all of the following factors will
influence how much a retiring individual will receive as a monthly income
benefit except the individual's - ANSWER Sex
5. In life insurance, insurance interest must exist at the time the - ANSWER
Producer writes an application on a proposed insured
6. Which of the following statements is NOT correct about representations? -
ANSWER They are true in every respect
7. An insurance producer takes an application for a life insurance policy but
does not collect the initial premium. On delivery of the policy to the
proposed insured, the producer must collect the initial premium and which
of the following? - ANSWER The insured's signed statement of continued
good health
8. Which of the following retirement plans is tax-qualified? - ANSWER
Defined contribution
9. Which of the following statements is correct about the paid-up additions in a
participating whole life policy? - ANSWER They are purchased on an
attained age basis
10.The right to change a beneficiary designation is reserved for the: -
ANSWER Policyowner
11.Which of the following provisions in a life policy specifies the manner in
which proceeds will be paid to a beneficiary on the death of the insured? -
ANSWER Settlement options
12.Two business partners own life insurance on each other. If one partner dies,
which of the following contracts will allow the other partner to buy 100
percent of the business interest? - ANSWER buy-sell agreement
13.The waiver of premium provision of a life policy allows the insurer to take
which of the following actions? - ANSWER waive an insured's premiums if
the insured becomes totally disabled before a certian age
14.A life insurance application is incomplete if it is missing the signature of
which of the following? - ANSWER The proposed adult insured
2
, 15.Which of the following statements is correct about group life conversion
privileges? - ANSWER Death during the conversion period is covered if the
departing employee chose not to conver the policy.
16.In the event of an insured's death, which of the following provides an
income for the family during a designated period of time followed by a lump
sum death benefit? - ANSWER Family income rider
17.A policyowner names his wife as the primary beneficiary of his Universal
Life policy on a revocable basis. He also names his three children as his
secondary beneficiaries and his estate as his tertiary beneficiary. If the
policyowner's wife predeceases him, and then he dies, who will receive the
policy proceeds? - ANSWER children
18.A contract that has as its basic function the systematic liquidation of
accumulated assets through periodic payments is called an - ANSWER
annuity
19.All of the following policies may be examples of third party ownership
except - ANSWER Modified Life
Group Life
Split-dollar Life
Key Employee Life
Modified Life
20.Which of the following group life plan requires at least 75 percent of the
eligible members to participate? - ANSWER Contributory
21.Which of the following features allows an insurance policy to remain in
force for a specified number of days beyond the premium due date? -
ANSWER Grace period provision
22.In which of the following contracts is the death benefit called the principal
sum? - ANSWER Accidental Death and Dismemberment (AD&D)
23.The primary reason for selecting a variable whole life policy instead of a
traditional whole life policy is that the variable whole life policy - ANSWER
Has the potential to earn a higher rate of return on the cash value
3
