Pennsylvania life insurance exam practice solutions
1. If an insurance company obtains an investigative consumer report on a prospective
insured, it MUST inform the prospect that it is permitted to do so under which of the
following federal laws?: Fair Credit Reporting Act
2. Obtaining consumer information report under false pretenses is prose- cutable by
which of the following?: Fair credit reporting
3. An insurance producer is defined as an individual who transacts business on behalf of: An
insurance company
4. What type of authority is in writing and allows a producer to act on behalf of the
insurer?: Express
5. What authority is NOT written and allows a producer to conduct the business of the
insurer?: Implied
6. Which type of authority holds that a producer may have whatever authority a
reasonable person would assume the producer has?: Apparent
7. Which of the following is an example of implied authority under the law of agency?: Once a
producer has a signed contact with an insure, they have the authority to perform any reasonable duties that are necessary to act as an
producer
8. A fraternal benefit society is one that: Provides life insurance benefits to its members
9. Which is the difference between participating and non-participating policies?-
: Participating policies pay dividends while non-participating policies do not
10. Which of the following is NOT authorized to transact insurance in a state?: -
1
, Non-admitted insurer
11. Which of the following type of insurers operates within the United States, but outside
of the state in which it is incorporated?: Foreign
12. An insurer that has been granted a certificate of authority to conduct busi- ness in
a particular state is referred to as: An admitted insurer
13. Which of the following underwriting sources acts as an information ex- change by
collecting general medical information about an individual's health history?: Medical information
Bureau
14. All of the following are classifications of risk EXCEPT: Non-nicotine
15. Which of the following occurs immediately after the application is submitted and
the initial premium paid?: The underwriting process begins
16. A consumer report used to determine eligibility for insurance may include all of the
following EXCEPT: Medical underwriting exam
17. An insurance policy's gross premium is calculated in which of the following ways?:
Mortality - interest + expenses
18. Which type of receipt makes the insurer liable for the risk from the date of
application, regardless of the applicants insurability?: Binding receipt
19. All of the following are TRUE regarding incomplete applications EXCEPT: The incomplete
application can be accepted with the missing information added later
20. What is a MIB report: Medical information on a applicant for assessing life or health insurance risk
21. How do warranties differ from representation?: A warranty is granted to be true, a repre-
2
1. If an insurance company obtains an investigative consumer report on a prospective
insured, it MUST inform the prospect that it is permitted to do so under which of the
following federal laws?: Fair Credit Reporting Act
2. Obtaining consumer information report under false pretenses is prose- cutable by
which of the following?: Fair credit reporting
3. An insurance producer is defined as an individual who transacts business on behalf of: An
insurance company
4. What type of authority is in writing and allows a producer to act on behalf of the
insurer?: Express
5. What authority is NOT written and allows a producer to conduct the business of the
insurer?: Implied
6. Which type of authority holds that a producer may have whatever authority a
reasonable person would assume the producer has?: Apparent
7. Which of the following is an example of implied authority under the law of agency?: Once a
producer has a signed contact with an insure, they have the authority to perform any reasonable duties that are necessary to act as an
producer
8. A fraternal benefit society is one that: Provides life insurance benefits to its members
9. Which is the difference between participating and non-participating policies?-
: Participating policies pay dividends while non-participating policies do not
10. Which of the following is NOT authorized to transact insurance in a state?: -
1
, Non-admitted insurer
11. Which of the following type of insurers operates within the United States, but outside
of the state in which it is incorporated?: Foreign
12. An insurer that has been granted a certificate of authority to conduct busi- ness in
a particular state is referred to as: An admitted insurer
13. Which of the following underwriting sources acts as an information ex- change by
collecting general medical information about an individual's health history?: Medical information
Bureau
14. All of the following are classifications of risk EXCEPT: Non-nicotine
15. Which of the following occurs immediately after the application is submitted and
the initial premium paid?: The underwriting process begins
16. A consumer report used to determine eligibility for insurance may include all of the
following EXCEPT: Medical underwriting exam
17. An insurance policy's gross premium is calculated in which of the following ways?:
Mortality - interest + expenses
18. Which type of receipt makes the insurer liable for the risk from the date of
application, regardless of the applicants insurability?: Binding receipt
19. All of the following are TRUE regarding incomplete applications EXCEPT: The incomplete
application can be accepted with the missing information added later
20. What is a MIB report: Medical information on a applicant for assessing life or health insurance risk
21. How do warranties differ from representation?: A warranty is granted to be true, a repre-
2
