PEARSON VUE TEXAS LIFE AND HEALTH INSURANCE TEST QUESTIONS
A+ VERIFIED LATEST VERSION
1. Who is obligated to make sure all questions are answered and all necessary
signatures are collected on the application?: The Agent
2. An underwriter is reviewing an applicant with an extensive medical history.
Which of the following would give the underwriter a better understanding
of how the applicant has been treated for various illnesses?: Attending physician's
statement
3. Which of the following would NOT be eligible for coverage under key per-
son?: The owner of the shop
4. With Adjustable Life, the owner can change all of the following EXCEPT: The
insured
5. Which of the following is provided by skilled medical personnel to those who
need occasional medical assistance or rehabilitative care?: Intermediate care
6. Partial disability usually pays what percentage of the total disability benefit?-
: 50%
7. Which of the following long-term care benefits would provide coverage for
care for functionally impaired adults on a less than 24-hour basis?
A. Residential care
B. Assisted living
C. Home health care
D. Adult day care: D. Adult day care
8. An insured's long-tern care policy is scheduled to pay fixed amount of
coverage of $120 per day. The long-term care facility only charged $100 per
day. How much will the insurance company pay?
A. 20% of the total cost
B. $120 a day
C. $100 a day
D. 80% of the total cost: B. $120 a day
9. In comparison to a policy that uses the accidental means definition, a policy
that uses the accidental bodily injury definition would provide coverage that
is
A. More limited in duration
B. Broader in duration
, PEARSON VUE TEXAS LIFE AND HEALTH INSURANCE TEST QUESTIONS
A+ VERIFIED LATEST VERSION
C. Broder in general
D. More limited in general: C. Broader in general
10. An individual has been diagnosed with Alzheimer's disease. He is insured
under a life insurance policy with the accelerated benefits rider. Which of the
following is true regarding taxation of the accelerated benefits?
A. The entire living benefits is considered taxable income
B. A portion of the benefits up to a limit is tax-free; the rest is taxable income
C. Principle is tax free, but interest is taxed
D. The entire benefits will be received tax free: B. B. A portion of the benefits up to a limit is
tax-free; the rest is taxable income
11. All of the following are true of an annuity owner EXCEPT
A. The owner has the right to name the beneficiary
B. The owner is the party who may surrender the annuity
C. The owner must be the party to receive benefits
D. The owner pays the premiums on the annuity: C. The owner must be the party to receive
benefits
12. How is emergency care covered for a member of an HMO?
A. An HMO emergency specialist will cover the patient
B. A member of an HMO can receive care in or out of the HMO service area,
but care is preferred in the service area
C. A member of an HMO may receive care at any emergency facility, at the
same cost as if in his or her own service area
D. HMOs have salaried member physicians, but they do not cover emergency
care: B. A member of an HMO can receive care in or out of the HMO service area, but care is preferred in the service
area
13. Death benefits payable to a beneficiary under a life insurance policy are
generally
A. Subject to income taxation by the federal government
B. Exempt from income taxation if under $10,000
C. Exempt from income taxation if over $10,000
D. Not subject to income taxation by the federal government: D. Not subject to income
taxation by the federal government
, PEARSON VUE TEXAS LIFE AND HEALTH INSURANCE TEST QUESTIONS
A+ VERIFIED LATEST VERSION
14. Which of the following best describes the aleatory nature of an insurance
contract?
A. Only one of the parties being legally bound by the contract
B. Ambiguities are interpreted in favor of the insured
C. Policies are submitted to the insurer on a take-it-or-leave-it basis
D. Exchange of unequal values: D. Exchange of unequal values
15. Which of the following is considered a presumptive disability under a dis-
ability income policy
A. Loss of two limbs
B. Loss of an eye
C. Loss of hearing in one ear
D. Loss of one hand or foot: A. loss of two limbs
16. An insured purchased a noncancelable health insurance policy 1 year ago.
Which of the following circumstances would NOT be a reason for the insur-
ance company to cancel the policy?
A. The insured reaches the maximum age limit specified in the policy
B. Within two years of the application, the insurer discovers a misrepresenta-
tion
C. The insured is an accident and incurs a large claim
D. The insured does not pay the premium: C. The insured is an accident and incurs a large claim
17. When the insured selects the extended term nonforfeiture option, the cash
value will be used to purchase term insurance with what face amount?
A. The same as the original policy minus the cash value
B. Equal to the original policy for as long as the cash values will purchase
C. In lesser amounts for the remaining policy term of age 100
D. Equal to the cash value surrendered from the policy: B. Equal to the original policy for
as long as the cash values will purchase
18. *What is the purpose of settlement options?
A. They are guarantees built into the policy
B. They guarantee a return of excess premiums
C. they provide the beneficiary the income he/she cannot outlive
, PEARSON VUE TEXAS LIFE AND HEALTH INSURANCE TEST QUESTIONS
A+ VERIFIED LATEST VERSION
D. Determines how the death benefit will be paid to the beneficiary: D. Determines
how the death benefit will be paid to the beneficiary
19. The premium charged for exercising the guaranteed insurability Rider is
based upon the insured's
A. Assumed age
B. Average age
C. Issue age
D. Attained age: D. Attained age
20. Which of the following best describes the "first-dollar coverage" principle
in basic medical insurance?
A. The insured must first pay a deductible
B. The insurer covers the first claim on the policy
C. Deductibles and coinsurance are taxed first
D. The insured is not required to pay a deductible: D. The insured is not required to pay a
deductible
21. Which of the following determines the cash value of a variable life policy?
A. The performance of the policy portfolio
B. The company's general account
C. The policy's guarantees
D. The premium mode: D. The premium mode
22. An individual applied for an insurance policy and paid the initial premium.
The insurer issued a conditional receipt. Five days later the applicant had to
submit to a medical exam. If the policy is issued, what would be the policy's
effective date?
A. The date of the application
B. The date of the medical exam
C. The date of policy delivery
D. The date of issue: B. The date of the medical exam
23. An applicant who receives a preferred risk classification qualifies for
A. Higher premiums than a person who receives a sub-standard risk
B. Higher premiums than a person who receives a standard risk
C. Lower premiums than a person who receives a standard risk
A+ VERIFIED LATEST VERSION
1. Who is obligated to make sure all questions are answered and all necessary
signatures are collected on the application?: The Agent
2. An underwriter is reviewing an applicant with an extensive medical history.
Which of the following would give the underwriter a better understanding
of how the applicant has been treated for various illnesses?: Attending physician's
statement
3. Which of the following would NOT be eligible for coverage under key per-
son?: The owner of the shop
4. With Adjustable Life, the owner can change all of the following EXCEPT: The
insured
5. Which of the following is provided by skilled medical personnel to those who
need occasional medical assistance or rehabilitative care?: Intermediate care
6. Partial disability usually pays what percentage of the total disability benefit?-
: 50%
7. Which of the following long-term care benefits would provide coverage for
care for functionally impaired adults on a less than 24-hour basis?
A. Residential care
B. Assisted living
C. Home health care
D. Adult day care: D. Adult day care
8. An insured's long-tern care policy is scheduled to pay fixed amount of
coverage of $120 per day. The long-term care facility only charged $100 per
day. How much will the insurance company pay?
A. 20% of the total cost
B. $120 a day
C. $100 a day
D. 80% of the total cost: B. $120 a day
9. In comparison to a policy that uses the accidental means definition, a policy
that uses the accidental bodily injury definition would provide coverage that
is
A. More limited in duration
B. Broader in duration
, PEARSON VUE TEXAS LIFE AND HEALTH INSURANCE TEST QUESTIONS
A+ VERIFIED LATEST VERSION
C. Broder in general
D. More limited in general: C. Broader in general
10. An individual has been diagnosed with Alzheimer's disease. He is insured
under a life insurance policy with the accelerated benefits rider. Which of the
following is true regarding taxation of the accelerated benefits?
A. The entire living benefits is considered taxable income
B. A portion of the benefits up to a limit is tax-free; the rest is taxable income
C. Principle is tax free, but interest is taxed
D. The entire benefits will be received tax free: B. B. A portion of the benefits up to a limit is
tax-free; the rest is taxable income
11. All of the following are true of an annuity owner EXCEPT
A. The owner has the right to name the beneficiary
B. The owner is the party who may surrender the annuity
C. The owner must be the party to receive benefits
D. The owner pays the premiums on the annuity: C. The owner must be the party to receive
benefits
12. How is emergency care covered for a member of an HMO?
A. An HMO emergency specialist will cover the patient
B. A member of an HMO can receive care in or out of the HMO service area,
but care is preferred in the service area
C. A member of an HMO may receive care at any emergency facility, at the
same cost as if in his or her own service area
D. HMOs have salaried member physicians, but they do not cover emergency
care: B. A member of an HMO can receive care in or out of the HMO service area, but care is preferred in the service
area
13. Death benefits payable to a beneficiary under a life insurance policy are
generally
A. Subject to income taxation by the federal government
B. Exempt from income taxation if under $10,000
C. Exempt from income taxation if over $10,000
D. Not subject to income taxation by the federal government: D. Not subject to income
taxation by the federal government
, PEARSON VUE TEXAS LIFE AND HEALTH INSURANCE TEST QUESTIONS
A+ VERIFIED LATEST VERSION
14. Which of the following best describes the aleatory nature of an insurance
contract?
A. Only one of the parties being legally bound by the contract
B. Ambiguities are interpreted in favor of the insured
C. Policies are submitted to the insurer on a take-it-or-leave-it basis
D. Exchange of unequal values: D. Exchange of unequal values
15. Which of the following is considered a presumptive disability under a dis-
ability income policy
A. Loss of two limbs
B. Loss of an eye
C. Loss of hearing in one ear
D. Loss of one hand or foot: A. loss of two limbs
16. An insured purchased a noncancelable health insurance policy 1 year ago.
Which of the following circumstances would NOT be a reason for the insur-
ance company to cancel the policy?
A. The insured reaches the maximum age limit specified in the policy
B. Within two years of the application, the insurer discovers a misrepresenta-
tion
C. The insured is an accident and incurs a large claim
D. The insured does not pay the premium: C. The insured is an accident and incurs a large claim
17. When the insured selects the extended term nonforfeiture option, the cash
value will be used to purchase term insurance with what face amount?
A. The same as the original policy minus the cash value
B. Equal to the original policy for as long as the cash values will purchase
C. In lesser amounts for the remaining policy term of age 100
D. Equal to the cash value surrendered from the policy: B. Equal to the original policy for
as long as the cash values will purchase
18. *What is the purpose of settlement options?
A. They are guarantees built into the policy
B. They guarantee a return of excess premiums
C. they provide the beneficiary the income he/she cannot outlive
, PEARSON VUE TEXAS LIFE AND HEALTH INSURANCE TEST QUESTIONS
A+ VERIFIED LATEST VERSION
D. Determines how the death benefit will be paid to the beneficiary: D. Determines
how the death benefit will be paid to the beneficiary
19. The premium charged for exercising the guaranteed insurability Rider is
based upon the insured's
A. Assumed age
B. Average age
C. Issue age
D. Attained age: D. Attained age
20. Which of the following best describes the "first-dollar coverage" principle
in basic medical insurance?
A. The insured must first pay a deductible
B. The insurer covers the first claim on the policy
C. Deductibles and coinsurance are taxed first
D. The insured is not required to pay a deductible: D. The insured is not required to pay a
deductible
21. Which of the following determines the cash value of a variable life policy?
A. The performance of the policy portfolio
B. The company's general account
C. The policy's guarantees
D. The premium mode: D. The premium mode
22. An individual applied for an insurance policy and paid the initial premium.
The insurer issued a conditional receipt. Five days later the applicant had to
submit to a medical exam. If the policy is issued, what would be the policy's
effective date?
A. The date of the application
B. The date of the medical exam
C. The date of policy delivery
D. The date of issue: B. The date of the medical exam
23. An applicant who receives a preferred risk classification qualifies for
A. Higher premiums than a person who receives a sub-standard risk
B. Higher premiums than a person who receives a standard risk
C. Lower premiums than a person who receives a standard risk
