Pearson VUE Texas Life and Health Insurance Exam
Questions & Answers 2026 | Latest Review Guide
1. Describe how the Life Insurance Guaranty Association benefits policyowners
and beneficiaries in the event of an insurance company's insolvency.
The Life Insurance Guaranty Association allows agents to continue
selling policies regardless of company stability.
The Life Insurance Guaranty Association encourages companies to
write riskier policies to increase profits.
The Life Insurance Guaranty Association primarily focuses on
maintaining the insurance company's reputation.
The Life Insurance Guaranty Association provides financial
protection to policyowners and beneficiaries, ensuring they receive
benefits even if their insurance company fails financially.
2. What is the maximum number of days within which a hearing must be held
after a Cease and Desist Order is issued by the commissioner of Insurance
upon request?
60
10
14
30
3. Each application for Life insurance requires the signature of...
The proposed insured
The policyowner, if different from the insured
The agent
, All of the above
4. What is one of the responsibilities of an insurance agent when delivering a
policy?
Approve or decline the application
Issue the policy without the applicant present
Collect payment at time of delivery
Collect medical statements from physicians
5. Describe how the attained age affects the premium for the guaranteed
insurability Rider.
The premium is determined by the issue age of the policyholder.
The premium is based on the average age of all insured individuals in
the policy.
The premium is fixed at the time of policy issuance and does not
change with age.
The premium for the guaranteed insurability Rider is calculated
based on the insured's attained age, reflecting their current age at
the time of exercising the rider.
6. If an individual chooses a health insurance plan with a 'first-dollar basis'
coverage, how might this affect their out-of-pocket expenses during a
medical emergency?
They would pay a lower premium but higher out-of-pocket costs.
They would need to pay a significant deductible before receiving
benefits.
They would have to wait for a waiting period before benefits are
available.
, They would not have any out-of-pocket expenses before the
insurance coverage begins.
7. Which of the following is a source of financing for Medicare Part B?
Monthly premium
State funding
Employer contributions
Medicare Part A funds
8. Describe the role of consideration in an insurance policy and how it affects
the obligations of both parties.
Consideration refers to the value exchanged in an insurance
contract, which binds both the insurer and the insured to their
respective obligations.
Consideration is a term that describes the insurer's duty to act in good
faith.
Consideration is a principle that allows the insurer to change policy
terms at any time.
Consideration is the process of underwriting an insurance policy.
9. If an insurance agent receives a consumer report indicating poor credit
history for a potential client, how might this affect the underwriting decision?
It guarantees approval of the insurance policy.
It only affects the policy's renewal terms.
It will have no effect on the underwriting decision.
It may lead to a higher premium or denial of coverage.
, 10. Which of the following is true about the requirements regarding HIV exams?
The applicant must give prior informed written consent.
Prior informed oral consent is required from the applicant.
HIV exams may not be used as a basis for underwriting.
Results may be disclosed to the agent and the underwriter.
11. Describe the purpose of the Free Look period in health insurance policies.
The Free Look period is the time required for underwriting a policy.
The Free Look period is a grace period for late premium payments.
The Free Look period is a time when claims cannot be made.
The Free Look period allows policyholders to review their health
insurance policy and decide whether to keep it without penalty.
12. Settlement options in a life insurance policy:
Are various modes for premium payments
Provide for various methods of paying policy proceeds
Are similar to non-forfeiture provisions
Are the same as annuities
13. Describe how key person insurance can benefit a business when a key
employee is lost.
It compensates the family of the key employee for their loss.
It covers the business's operational costs during the employee's
absence.
Questions & Answers 2026 | Latest Review Guide
1. Describe how the Life Insurance Guaranty Association benefits policyowners
and beneficiaries in the event of an insurance company's insolvency.
The Life Insurance Guaranty Association allows agents to continue
selling policies regardless of company stability.
The Life Insurance Guaranty Association encourages companies to
write riskier policies to increase profits.
The Life Insurance Guaranty Association primarily focuses on
maintaining the insurance company's reputation.
The Life Insurance Guaranty Association provides financial
protection to policyowners and beneficiaries, ensuring they receive
benefits even if their insurance company fails financially.
2. What is the maximum number of days within which a hearing must be held
after a Cease and Desist Order is issued by the commissioner of Insurance
upon request?
60
10
14
30
3. Each application for Life insurance requires the signature of...
The proposed insured
The policyowner, if different from the insured
The agent
, All of the above
4. What is one of the responsibilities of an insurance agent when delivering a
policy?
Approve or decline the application
Issue the policy without the applicant present
Collect payment at time of delivery
Collect medical statements from physicians
5. Describe how the attained age affects the premium for the guaranteed
insurability Rider.
The premium is determined by the issue age of the policyholder.
The premium is based on the average age of all insured individuals in
the policy.
The premium is fixed at the time of policy issuance and does not
change with age.
The premium for the guaranteed insurability Rider is calculated
based on the insured's attained age, reflecting their current age at
the time of exercising the rider.
6. If an individual chooses a health insurance plan with a 'first-dollar basis'
coverage, how might this affect their out-of-pocket expenses during a
medical emergency?
They would pay a lower premium but higher out-of-pocket costs.
They would need to pay a significant deductible before receiving
benefits.
They would have to wait for a waiting period before benefits are
available.
, They would not have any out-of-pocket expenses before the
insurance coverage begins.
7. Which of the following is a source of financing for Medicare Part B?
Monthly premium
State funding
Employer contributions
Medicare Part A funds
8. Describe the role of consideration in an insurance policy and how it affects
the obligations of both parties.
Consideration refers to the value exchanged in an insurance
contract, which binds both the insurer and the insured to their
respective obligations.
Consideration is a term that describes the insurer's duty to act in good
faith.
Consideration is a principle that allows the insurer to change policy
terms at any time.
Consideration is the process of underwriting an insurance policy.
9. If an insurance agent receives a consumer report indicating poor credit
history for a potential client, how might this affect the underwriting decision?
It guarantees approval of the insurance policy.
It only affects the policy's renewal terms.
It will have no effect on the underwriting decision.
It may lead to a higher premium or denial of coverage.
, 10. Which of the following is true about the requirements regarding HIV exams?
The applicant must give prior informed written consent.
Prior informed oral consent is required from the applicant.
HIV exams may not be used as a basis for underwriting.
Results may be disclosed to the agent and the underwriter.
11. Describe the purpose of the Free Look period in health insurance policies.
The Free Look period is the time required for underwriting a policy.
The Free Look period is a grace period for late premium payments.
The Free Look period is a time when claims cannot be made.
The Free Look period allows policyholders to review their health
insurance policy and decide whether to keep it without penalty.
12. Settlement options in a life insurance policy:
Are various modes for premium payments
Provide for various methods of paying policy proceeds
Are similar to non-forfeiture provisions
Are the same as annuities
13. Describe how key person insurance can benefit a business when a key
employee is lost.
It compensates the family of the key employee for their loss.
It covers the business's operational costs during the employee's
absence.
