Texas Life & Health Insurance Exam
With Actual Questions & Verified
Answers, Plus Explained
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1. Which type of life insurance policy provides coverage for a
specified period and pays a death benefit only if the insured dies
during that period?
A. Whole life
B. Universal life
C. Term life
D. Variable life
Term life insurance provides coverage for a specified term, such
as 10, 20, or 30 years, and pays a death benefit only if death
occurs during that term.
2. In a life insurance policy, the consideration clause specifies:
A. The amount of the death benefit
B. The insurer’s underwriting rules
C. The premium and statements made by the insured
D. The policy exclusions
The consideration clause defines the exchange of value between
the insurer and insured, usually the premium and the insured’s
statements.
,3. Which type of policy allows the policyholder to adjust the death
benefit and premium within certain limits?
A. Term life
B. Whole life
C. Universal life
D. Variable life
Universal life policies offer flexible premiums and adjustable
death benefits, making them more adaptable to the
policyholder’s needs.
4. A life insurance policyowner dies, and the death benefit is paid to
a designated beneficiary. This is an example of:
A. Risk pooling
B. Premium accumulation
C. Indemnity
D. Adverse selection
The death benefit compensates the beneficiary financially for the
loss of the insured, which aligns with the principle of indemnity.
5. Which type of life insurance combines a savings element with a
death benefit, where the cash value grows at a guaranteed rate?
A. Term life
B. Whole life
C. Universal life
D. Variable life
Whole life insurance provides lifetime coverage and builds cash
value at a guaranteed rate.
6. In health insurance, which provision ensures coverage for pre-
existing conditions after a specified waiting period?
A. Coinsurance
B. Deductible
, C. Probationary period
D. Copayment
A probationary period limits coverage for pre-existing conditions
for a defined period after the policy begins.
7. Which Texas law requires insurance companies to pay claims
within a certain period after proof of loss?
A. Insurance Code Chapter 541
B. Insurance Code Chapter 4001
C. Prompt Payment of Claims Act
D. HIPAA
The Texas Prompt Payment of Claims Act sets timeframes for
insurers to process and pay claims to protect policyholders.
8. Which type of policy allows the policyholder to invest the cash
value in separate accounts tied to market performance?
A. Whole life
B. Universal life
C. Variable life
D. Term life
Variable life policies allow cash value to be invested in sub-
accounts, which can vary with market performance.
9. Which of the following is NOT a characteristic of group life
insurance?
A. Issued to a group under one contract
B. Usually less expensive than individual coverage
C. Requires medical underwriting for each member
D. Often sponsored by employers
Group life insurance generally does not require individual
medical underwriting for each member.
With Actual Questions & Verified
Answers, Plus Explained
Rationales/Expert Verified For
Guaranteed 100% Pass 2026/Latest
Update/Instant Download Pdf
1. Which type of life insurance policy provides coverage for a
specified period and pays a death benefit only if the insured dies
during that period?
A. Whole life
B. Universal life
C. Term life
D. Variable life
Term life insurance provides coverage for a specified term, such
as 10, 20, or 30 years, and pays a death benefit only if death
occurs during that term.
2. In a life insurance policy, the consideration clause specifies:
A. The amount of the death benefit
B. The insurer’s underwriting rules
C. The premium and statements made by the insured
D. The policy exclusions
The consideration clause defines the exchange of value between
the insurer and insured, usually the premium and the insured’s
statements.
,3. Which type of policy allows the policyholder to adjust the death
benefit and premium within certain limits?
A. Term life
B. Whole life
C. Universal life
D. Variable life
Universal life policies offer flexible premiums and adjustable
death benefits, making them more adaptable to the
policyholder’s needs.
4. A life insurance policyowner dies, and the death benefit is paid to
a designated beneficiary. This is an example of:
A. Risk pooling
B. Premium accumulation
C. Indemnity
D. Adverse selection
The death benefit compensates the beneficiary financially for the
loss of the insured, which aligns with the principle of indemnity.
5. Which type of life insurance combines a savings element with a
death benefit, where the cash value grows at a guaranteed rate?
A. Term life
B. Whole life
C. Universal life
D. Variable life
Whole life insurance provides lifetime coverage and builds cash
value at a guaranteed rate.
6. In health insurance, which provision ensures coverage for pre-
existing conditions after a specified waiting period?
A. Coinsurance
B. Deductible
, C. Probationary period
D. Copayment
A probationary period limits coverage for pre-existing conditions
for a defined period after the policy begins.
7. Which Texas law requires insurance companies to pay claims
within a certain period after proof of loss?
A. Insurance Code Chapter 541
B. Insurance Code Chapter 4001
C. Prompt Payment of Claims Act
D. HIPAA
The Texas Prompt Payment of Claims Act sets timeframes for
insurers to process and pay claims to protect policyholders.
8. Which type of policy allows the policyholder to invest the cash
value in separate accounts tied to market performance?
A. Whole life
B. Universal life
C. Variable life
D. Term life
Variable life policies allow cash value to be invested in sub-
accounts, which can vary with market performance.
9. Which of the following is NOT a characteristic of group life
insurance?
A. Issued to a group under one contract
B. Usually less expensive than individual coverage
C. Requires medical underwriting for each member
D. Often sponsored by employers
Group life insurance generally does not require individual
medical underwriting for each member.
