ALABAMA LIFE INSURANCE EXAM 2026 COMPREHENSIVE
EXAM QUESTIONS |FREQUENTLY TESTED QUESTIONS
|RECENTLY TESTING REAL EXAM QUESTIONS|VERIFIED
SOLUTIONS (100% CORRECT)
A ____________ company is one that is domiciled in another state and has Not
received a license to do business in Alabama. - ............ANSWER.............. Foreign
Nonamitted
A 15-year mortgage - ............ANSWER.............. 15 year decreasing term
A collateral assignment allows a policy owner to assign: -
............ANSWER.............. A portion of the policy provides to the assignee
A cross purchase buy-see agreement is in place of ABC Company four founding
partners. What would this agreement require if the agreement is funded with
individual life insurance? - ............ANSWER.............. Each partner must own a
policy on the others partners
A father who dies within 3 years after purchasing a life insurance policy on his
infant daughter can have the policy premiums waived under which provision? -
............ANSWER.............. Payor Provision
A husband and wife are receiving annuity payments. When the husband dies, the
wife still receives annuity payments for life. What kind of annuity is this? -
............ANSWER.............. Joint and survivorship life annuity
A husband and wife purchase a life insurance policy that covers both of them. The
policy paid nothing when the husband died. Two years later, the wife dies, and a
death benefit is paid to the beneficiary. What type of policy is this? -
............ANSWER.............. Survivorship life policy
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,A licensed Alabama insurance producer would NOT be disciplined by the
commissioner of insurance for: - ............ANSWER.............. Being convicted of a
misdemeanor
A life insurance policy owned by a third party: - ............ANSWER.............. Is used
largely in an estate planning as well as business situations
A life insurance policyowner has just exercised the policy's reduced paid-up
option. Which of these statements are true? - ............ANSWER.............. The
amount of coverage will be less than the original coverage
A life insurance producer's agency agreement normally authorizes the licensee to
do all of the following, except? - ............ANSWER.............. issue`s policies
A policy owner can collect the face amount on what type of policy? -
............ANSWER.............. Endowment policy
A policyowner with a $100,000 whole life policy has a cash value of $10,000.
There is an outstanding loan of $5,000 and a past-due premium of $250. If the
policy owner chooses the reduced paid-up option and then later dies, what will the
beneficiary receive? - ............ANSWER.............. reduced paid up coverage
amounts minus $5,250
A policyowner with an automatic premium loan provision must: -
............ANSWER.............. Pay back the loan amount to keep the policy's cash
value at its minimum
A retirement plan intended for a sole proprietor and his/her employees would be
a(n): - ............ANSWER.............. Keogh Plan
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, A substandard or special class risk typically results in: - ............ANSWER..............
Premium that is higher than for a normal risk
A waiver of premium: - ............ANSWER.............. waives the premiums when the
policyowner becomes totally disabled
A written agreement that involves two or more parties and considerations is: -
............ANSWER.............. A contract
ABC Company takes out a Key Employee policy on its CEO. The CEO leaves
ABC Company and begins works for XYZ Company five years later. If this person
were to die and the policy is still in force and unchanged, where would the death
proceeds be directed? - ............ANSWER.............. ABC Company
According to Alabama law, a minor: - ............ANSWER.............. 18 can beging
receiving life insuance death benefits up to 3,000 a year
Alabama's annuity disclosure regulation: - ............ANSWER.............. requires the
delivery of a buyers guide and a discloser document to an annuity applicant
Alabama's continuing education law states that an insurance producer must report
how many classroom hours every two years? - ............ANSWER.............. 24hrs
Alabama's head of the Department of Insurance does Not have the power to: -
............ANSWER.............. promulgate insurance laws
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EXAM QUESTIONS |FREQUENTLY TESTED QUESTIONS
|RECENTLY TESTING REAL EXAM QUESTIONS|VERIFIED
SOLUTIONS (100% CORRECT)
A ____________ company is one that is domiciled in another state and has Not
received a license to do business in Alabama. - ............ANSWER.............. Foreign
Nonamitted
A 15-year mortgage - ............ANSWER.............. 15 year decreasing term
A collateral assignment allows a policy owner to assign: -
............ANSWER.............. A portion of the policy provides to the assignee
A cross purchase buy-see agreement is in place of ABC Company four founding
partners. What would this agreement require if the agreement is funded with
individual life insurance? - ............ANSWER.............. Each partner must own a
policy on the others partners
A father who dies within 3 years after purchasing a life insurance policy on his
infant daughter can have the policy premiums waived under which provision? -
............ANSWER.............. Payor Provision
A husband and wife are receiving annuity payments. When the husband dies, the
wife still receives annuity payments for life. What kind of annuity is this? -
............ANSWER.............. Joint and survivorship life annuity
A husband and wife purchase a life insurance policy that covers both of them. The
policy paid nothing when the husband died. Two years later, the wife dies, and a
death benefit is paid to the beneficiary. What type of policy is this? -
............ANSWER.............. Survivorship life policy
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,A licensed Alabama insurance producer would NOT be disciplined by the
commissioner of insurance for: - ............ANSWER.............. Being convicted of a
misdemeanor
A life insurance policy owned by a third party: - ............ANSWER.............. Is used
largely in an estate planning as well as business situations
A life insurance policyowner has just exercised the policy's reduced paid-up
option. Which of these statements are true? - ............ANSWER.............. The
amount of coverage will be less than the original coverage
A life insurance producer's agency agreement normally authorizes the licensee to
do all of the following, except? - ............ANSWER.............. issue`s policies
A policy owner can collect the face amount on what type of policy? -
............ANSWER.............. Endowment policy
A policyowner with a $100,000 whole life policy has a cash value of $10,000.
There is an outstanding loan of $5,000 and a past-due premium of $250. If the
policy owner chooses the reduced paid-up option and then later dies, what will the
beneficiary receive? - ............ANSWER.............. reduced paid up coverage
amounts minus $5,250
A policyowner with an automatic premium loan provision must: -
............ANSWER.............. Pay back the loan amount to keep the policy's cash
value at its minimum
A retirement plan intended for a sole proprietor and his/her employees would be
a(n): - ............ANSWER.............. Keogh Plan
2|Page
, A substandard or special class risk typically results in: - ............ANSWER..............
Premium that is higher than for a normal risk
A waiver of premium: - ............ANSWER.............. waives the premiums when the
policyowner becomes totally disabled
A written agreement that involves two or more parties and considerations is: -
............ANSWER.............. A contract
ABC Company takes out a Key Employee policy on its CEO. The CEO leaves
ABC Company and begins works for XYZ Company five years later. If this person
were to die and the policy is still in force and unchanged, where would the death
proceeds be directed? - ............ANSWER.............. ABC Company
According to Alabama law, a minor: - ............ANSWER.............. 18 can beging
receiving life insuance death benefits up to 3,000 a year
Alabama's annuity disclosure regulation: - ............ANSWER.............. requires the
delivery of a buyers guide and a discloser document to an annuity applicant
Alabama's continuing education law states that an insurance producer must report
how many classroom hours every two years? - ............ANSWER.............. 24hrs
Alabama's head of the Department of Insurance does Not have the power to: -
............ANSWER.............. promulgate insurance laws
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