A potential client, age 40, would like to purchase a Whole Life policy that will accumulate cash value at a
faster rate in the early years of the policy. Which of these statements made by the producer would be
correct? - ANSWER- 20-Pay Life accumulates cash value faster than Straight Life
A policy loan is made possible by which of these life insurance policy features? - ANSWER- cash value
provision
Under federal tax laws, what is the tax treatment for an employer providing $50,000 of a contributory
group Term Life plan to all its eligible employees? - ANSWER- Portion of the premiums paid for by the
employer may be a tax deduction
The type of annuity that can be purchased with one monetary deposit is called a(n) - ANSWER- Immediate
annuity
Which of the following is the reimbursement of benefits for the treatment of a beneficiary's injuries caused
by a third party? - ANSWER- Subrogation
What does the Medical Information Bureau (MIB) identify? - ANSWER- Existing life insurance coverage with
other carriers
How long is the typical free look period for Long Term care insurance policies? - ANSWER- 30 days
Which type of renewability best describes a Disability Income policy that covers an individual until the age
of 65, but the insurer has the right to change the premium rate? - ANSWER- Guaranteed renewable
Insurance contracts are known as ____ because certain future conditions or acts must occur before any
claims can be paid. - ANSWER- conditional
The sections of an insurance contract which limit coverage are called - ANSWER- exclusions
Which of the following best describes a contingent beneficiary? - ANSWER- Person designated by the
insured to receive policy proceeds in the event that the primary beneficiary dies before the insured
A major medical policy typically - ANSWER- provides benefits for reasonable and necessary medical
expenses, subject to policy limits
An insurer must provide an insured with claim forms within __ days after receiving notice of a loss. -
ANSWER- 15 days
A "reimbursement policy" pays what amount of covered Long-Term Care expenses? - ANSWER- Actual
covered expenses up to the daily maximum
Which of the following is NOT included in the policy face? - ANSWER- Exclusions
T is receiving $3,000/month from a Disability Income policy in which T's employer had paid the premiums.
How are the $3,000 benefit payments taxable? - ANSWER- Benefits are taxable to T
A physician opens up a new practice and qualifies for a $7,000/month Disability Income policy. What rider
would the physician add if he wants the ability to increase his policy benefit as his practice and income
grow? - ANSWER- Guaranteed Insurability Option rider
A policyowner's rights are limited under which beneficiary designation? - ANSWER- Irrevcocable
Which statement is true regarding a minor beneficiary - ANSWER- Normally, a guardian is required to be
appointed in the Beneficiary clause of the contract
, A level premium indicates - ANSWER- the premium is fixed for the entire duration of the contract
On a life insurance policy, who is qualified to change the beneficiary designation? - ANSWER- Policyowner
A life insurance application must be signed by all of these EXCEPT - ANSWER- beneficiary
At what time must a policyowner have insurable interest on the insured in order for the life policy to be
valid? - ANSWER- At the time of theApplicatioin
Consumer reports requested by an underwriter during the application process of a life insurance policy
can be used to determine - ANSWER- probability of making timely premium payments
K applies for a life insurance policy on herself and submits the initial premium with the application. She is
given a receipt by the agent stating that coverage begins immediately if the application is approved. What
kind of receipt was used? - ANSWER- Conditional
P is a producer who notices 5 questions on a life application were not answered. What actions should P
take? - ANSWER- Set up a meeting with the applicant to answer the remaining questions
When does a life insurance contract become effective if the initial premium is not collected during the
application process? - ANSWER- When producer delivers policy and collects initial premium
Q applied for life insurance and submitted the initial premium on January 1. The policy was issued
February 1, but it was not delivered by the agent until February 7. Q is dissatisfied and returns the policy
February 13. How will the insurer handle this situation? - ANSWER- Policy was returned within the free-
look period, premium will be fully refunded
Which of these factors do NOT play a role in the underwriting of a life insurance policy? - ANSWER- Marital
Status
Which of the following is an important underwriting principle of group life insurance? - ANSWER- Everyone
must be covered in the group
Which requirement must be met for an association to be eligible for a group life plan? - ANSWER- Group
was formed for a purpose other than acquiring insurance
What group term life feature permits an individual to depart from the group and continue to be covered
without providing evidence of insurability? - ANSWER- Conversion
What type of annuity has a cash value that is based upon the performance of it's underlying investment
funds? - ANSWER- Variable
One becomes eligible for Social Security disability benefits after having been disabled for - ANSWER- 5
months
Xcell Testing Solutions (Life & Health) Final 150 Question Practice Exam With Answers.
When can a policy owner change a revocable beneficiary? - ANSWER- Anytime
M purchased an Accidental Death and Dismemberment (AD&D) policy and named his son as beneficiary. M
has the right to change the beneficiary designation at anytime. What type of beneficiary is his son? -
ANSWER- Revocable
How would a contingent beneficiary receive the policy proceeds in an Accidental Death and
Dismemberment (AD&D) policy? - ANSWER- If the primary beneficiary dies before the insured
faster rate in the early years of the policy. Which of these statements made by the producer would be
correct? - ANSWER- 20-Pay Life accumulates cash value faster than Straight Life
A policy loan is made possible by which of these life insurance policy features? - ANSWER- cash value
provision
Under federal tax laws, what is the tax treatment for an employer providing $50,000 of a contributory
group Term Life plan to all its eligible employees? - ANSWER- Portion of the premiums paid for by the
employer may be a tax deduction
The type of annuity that can be purchased with one monetary deposit is called a(n) - ANSWER- Immediate
annuity
Which of the following is the reimbursement of benefits for the treatment of a beneficiary's injuries caused
by a third party? - ANSWER- Subrogation
What does the Medical Information Bureau (MIB) identify? - ANSWER- Existing life insurance coverage with
other carriers
How long is the typical free look period for Long Term care insurance policies? - ANSWER- 30 days
Which type of renewability best describes a Disability Income policy that covers an individual until the age
of 65, but the insurer has the right to change the premium rate? - ANSWER- Guaranteed renewable
Insurance contracts are known as ____ because certain future conditions or acts must occur before any
claims can be paid. - ANSWER- conditional
The sections of an insurance contract which limit coverage are called - ANSWER- exclusions
Which of the following best describes a contingent beneficiary? - ANSWER- Person designated by the
insured to receive policy proceeds in the event that the primary beneficiary dies before the insured
A major medical policy typically - ANSWER- provides benefits for reasonable and necessary medical
expenses, subject to policy limits
An insurer must provide an insured with claim forms within __ days after receiving notice of a loss. -
ANSWER- 15 days
A "reimbursement policy" pays what amount of covered Long-Term Care expenses? - ANSWER- Actual
covered expenses up to the daily maximum
Which of the following is NOT included in the policy face? - ANSWER- Exclusions
T is receiving $3,000/month from a Disability Income policy in which T's employer had paid the premiums.
How are the $3,000 benefit payments taxable? - ANSWER- Benefits are taxable to T
A physician opens up a new practice and qualifies for a $7,000/month Disability Income policy. What rider
would the physician add if he wants the ability to increase his policy benefit as his practice and income
grow? - ANSWER- Guaranteed Insurability Option rider
A policyowner's rights are limited under which beneficiary designation? - ANSWER- Irrevcocable
Which statement is true regarding a minor beneficiary - ANSWER- Normally, a guardian is required to be
appointed in the Beneficiary clause of the contract
, A level premium indicates - ANSWER- the premium is fixed for the entire duration of the contract
On a life insurance policy, who is qualified to change the beneficiary designation? - ANSWER- Policyowner
A life insurance application must be signed by all of these EXCEPT - ANSWER- beneficiary
At what time must a policyowner have insurable interest on the insured in order for the life policy to be
valid? - ANSWER- At the time of theApplicatioin
Consumer reports requested by an underwriter during the application process of a life insurance policy
can be used to determine - ANSWER- probability of making timely premium payments
K applies for a life insurance policy on herself and submits the initial premium with the application. She is
given a receipt by the agent stating that coverage begins immediately if the application is approved. What
kind of receipt was used? - ANSWER- Conditional
P is a producer who notices 5 questions on a life application were not answered. What actions should P
take? - ANSWER- Set up a meeting with the applicant to answer the remaining questions
When does a life insurance contract become effective if the initial premium is not collected during the
application process? - ANSWER- When producer delivers policy and collects initial premium
Q applied for life insurance and submitted the initial premium on January 1. The policy was issued
February 1, but it was not delivered by the agent until February 7. Q is dissatisfied and returns the policy
February 13. How will the insurer handle this situation? - ANSWER- Policy was returned within the free-
look period, premium will be fully refunded
Which of these factors do NOT play a role in the underwriting of a life insurance policy? - ANSWER- Marital
Status
Which of the following is an important underwriting principle of group life insurance? - ANSWER- Everyone
must be covered in the group
Which requirement must be met for an association to be eligible for a group life plan? - ANSWER- Group
was formed for a purpose other than acquiring insurance
What group term life feature permits an individual to depart from the group and continue to be covered
without providing evidence of insurability? - ANSWER- Conversion
What type of annuity has a cash value that is based upon the performance of it's underlying investment
funds? - ANSWER- Variable
One becomes eligible for Social Security disability benefits after having been disabled for - ANSWER- 5
months
Xcell Testing Solutions (Life & Health) Final 150 Question Practice Exam With Answers.
When can a policy owner change a revocable beneficiary? - ANSWER- Anytime
M purchased an Accidental Death and Dismemberment (AD&D) policy and named his son as beneficiary. M
has the right to change the beneficiary designation at anytime. What type of beneficiary is his son? -
ANSWER- Revocable
How would a contingent beneficiary receive the policy proceeds in an Accidental Death and
Dismemberment (AD&D) policy? - ANSWER- If the primary beneficiary dies before the insured
