1
LIFE INSURANCE EXAM (TEXAS) LATEST
QUESTIONS WITH ANSWERS (100% CORRECT
ANSWERS)
Insurance
(General concept) Answer: - transfers the risk of loss from an individual to an insurer
- based on the principle of indemnity
- based on the principle of risk (risk pooling)
insurable interest
(General Concept) Answer: - must exist at the time of the application
- insuring one's own life, family member, or a business partner
Solicitation and sales presentation Answer: - illustration- presentation of nonguaranteed
elements
- buyer's guide is generic information about life polices which must be provided at the time of
application
- policy summary is a description of features and benefits of the policy being issued and must
be provided when the policy is delivered.
Underwriting (Field underwriting (by agent) Answer: - application completed and signed
- agent's report: agent's observation about the application that can assist in underwriting
-premiums with application and conditional receipts
underwriting ( company underwriting) Answer: - multiple sources of information:
applications, consumer reports, MIB (Medical Information Burea)
© 2025 All rights reserved
, 2
- Risk Classification: 3 types of risk : standard, substandard, preferred
Underwriting (Federal Regulation) Answer: - Fair Credit Reporting Act: protect consumers
against circulations of inaccurate or obsolete information
- USE PATRIOT Act/ Anti-money Laundering and Suspicious Activity Reports Rules
Premium Determination Answer: - 3 key Factors for life insurance: mortality, interest, and
expense
- Mode: the more frequently premium is paid, the higher the premium
Policy Issue and Delivery Answer: Effective date of coverage - if the premium is not paid with
the application, the agent must obtain the premium and a statement of continued good health
at the time of the policy delivery
Agent/ Producer Answer: a legal representative of an insurance company; the classification of
producers usually includes agents and brokers' agents are the agents of the insurer
Applicant of proposed insured Answer: a person applying for insurance
Beneficiary Answer: a person who receives the benefits of an insurance policy
Broker Answer: an insurance producer who is not appointed by an insurance company and
who represents the client
Death benefits Answer: the amount paid upon death of the insured in a life insurance policy
Estate Answer: a person's net worth
Insurance policy Answer: a contact between a policyowner (and/or insured) and an insurance
company which agrees to pay insured or the beneficiary for loss caused by specific events.
Insured Answer: a person covered by the insurance policy; may or may not be the policyowner
insurer (principal) Answer: the company who issues an insurance policy
© 2025 All rights reserved
LIFE INSURANCE EXAM (TEXAS) LATEST
QUESTIONS WITH ANSWERS (100% CORRECT
ANSWERS)
Insurance
(General concept) Answer: - transfers the risk of loss from an individual to an insurer
- based on the principle of indemnity
- based on the principle of risk (risk pooling)
insurable interest
(General Concept) Answer: - must exist at the time of the application
- insuring one's own life, family member, or a business partner
Solicitation and sales presentation Answer: - illustration- presentation of nonguaranteed
elements
- buyer's guide is generic information about life polices which must be provided at the time of
application
- policy summary is a description of features and benefits of the policy being issued and must
be provided when the policy is delivered.
Underwriting (Field underwriting (by agent) Answer: - application completed and signed
- agent's report: agent's observation about the application that can assist in underwriting
-premiums with application and conditional receipts
underwriting ( company underwriting) Answer: - multiple sources of information:
applications, consumer reports, MIB (Medical Information Burea)
© 2025 All rights reserved
, 2
- Risk Classification: 3 types of risk : standard, substandard, preferred
Underwriting (Federal Regulation) Answer: - Fair Credit Reporting Act: protect consumers
against circulations of inaccurate or obsolete information
- USE PATRIOT Act/ Anti-money Laundering and Suspicious Activity Reports Rules
Premium Determination Answer: - 3 key Factors for life insurance: mortality, interest, and
expense
- Mode: the more frequently premium is paid, the higher the premium
Policy Issue and Delivery Answer: Effective date of coverage - if the premium is not paid with
the application, the agent must obtain the premium and a statement of continued good health
at the time of the policy delivery
Agent/ Producer Answer: a legal representative of an insurance company; the classification of
producers usually includes agents and brokers' agents are the agents of the insurer
Applicant of proposed insured Answer: a person applying for insurance
Beneficiary Answer: a person who receives the benefits of an insurance policy
Broker Answer: an insurance producer who is not appointed by an insurance company and
who represents the client
Death benefits Answer: the amount paid upon death of the insured in a life insurance policy
Estate Answer: a person's net worth
Insurance policy Answer: a contact between a policyowner (and/or insured) and an insurance
company which agrees to pay insured or the beneficiary for loss caused by specific events.
Insured Answer: a person covered by the insurance policy; may or may not be the policyowner
insurer (principal) Answer: the company who issues an insurance policy
© 2025 All rights reserved
