Page 1 of 79
COLORADO LIFE INSURANCE EXAM | {LATEST
2026/ 2027 UPDATE} COMPLETE ACTUAL AND
AUTHENTIC EXAM | BRAND NEW!
Lawrence signed an application for a life insurance policy on
September 2 and took a required medical exam on September 4.
He gave the agent a check for the initial premium and received a
conditional receipt at the time of application. The policy was
issue d as originally applied for and the agent delivered the policy
to him on October 15. The earliest effective date for Lawrence's
insurance policy would be
A) October 15
B) September 4
C) December 31
D) September 2
B) September 4 Explanation The conditional receipt explains to
the applicant that the policy will be issued subject to the approval
of the insurance company. If the policy is eventually issued as
originally applied for, typically the earliest effective dat e is the
date the applicant has completed all of the requirements. In this
instance the applicant was required to complete a medical exam
as part of the requirements, so the earliest effective date would
,Page 2 of 79
be the date the medical exam was completed. The date the policy
is actually delivered to the insured is immaterial.
The fact that elmo could die after paying just one premium on his
life insurance policy and still have the entire face amount paid to
his beneficiary is an example of
A) an executory contract
B) An aleatory contract
C) a contract of utmost good faith
D) a contract or adhesion
B) An aleatory contract
The purpose of a 401(k) plan is to save for
A) retirement
B) college costs for dependent children
C) periods of unemployment
D) unreimbursed medical expenses
A) retirement
,Page 3 of 79
Amanda took out a $250,000 home mortgage when she
purchased her house 5 years ago. What type of life insurance
policy would be the best choice to insure the remaining balance
on her home mortgage?
A) Decreasing term
B) Variable life
C) Whole life
D) Level term
A) Decreasing term
When appropriate, the Colorado Commissioner of Insurance
reports a violation of insurance law to:
A) an appropriate district attorney.
B) the attorney general.
C) the state legislature.
D) the state police.
A) an appropriate district attorney.
To be licensed to sell both life and accident and health insurance
in Colorado, an applicant must complete:
, Page 4 of 79
A) 40 hours of prelicensing education.
B) 80 hours of prelicensing education.
C) 100 hours of prelicensing education.
D) 20 hours of prelicense education in both life and health
insurance, for a total of 40 hours.
C) 100 hours of prelicensing education
What is the usual tax treatment of individual life insurance?
A) Deductibility of premiums, non - taxable death benefit
B) Non - deductibility of premiums, nontaxable death benefit
C) Non - Deductibility of premiums, taxable death benefit
D) Deductibility of premiums, taxable death benefit
B) Non - deductibility of premiums, nontaxable death benefit
Money taken out of a modified endowment contract (MEC)
A) will result in the policy being voided
B) May be subject to unfavorable tax rules
C) is always received income tax free
D) is considered to be a return of premium
B) May be subject to unfavorable tax rules
COLORADO LIFE INSURANCE EXAM | {LATEST
2026/ 2027 UPDATE} COMPLETE ACTUAL AND
AUTHENTIC EXAM | BRAND NEW!
Lawrence signed an application for a life insurance policy on
September 2 and took a required medical exam on September 4.
He gave the agent a check for the initial premium and received a
conditional receipt at the time of application. The policy was
issue d as originally applied for and the agent delivered the policy
to him on October 15. The earliest effective date for Lawrence's
insurance policy would be
A) October 15
B) September 4
C) December 31
D) September 2
B) September 4 Explanation The conditional receipt explains to
the applicant that the policy will be issued subject to the approval
of the insurance company. If the policy is eventually issued as
originally applied for, typically the earliest effective dat e is the
date the applicant has completed all of the requirements. In this
instance the applicant was required to complete a medical exam
as part of the requirements, so the earliest effective date would
,Page 2 of 79
be the date the medical exam was completed. The date the policy
is actually delivered to the insured is immaterial.
The fact that elmo could die after paying just one premium on his
life insurance policy and still have the entire face amount paid to
his beneficiary is an example of
A) an executory contract
B) An aleatory contract
C) a contract of utmost good faith
D) a contract or adhesion
B) An aleatory contract
The purpose of a 401(k) plan is to save for
A) retirement
B) college costs for dependent children
C) periods of unemployment
D) unreimbursed medical expenses
A) retirement
,Page 3 of 79
Amanda took out a $250,000 home mortgage when she
purchased her house 5 years ago. What type of life insurance
policy would be the best choice to insure the remaining balance
on her home mortgage?
A) Decreasing term
B) Variable life
C) Whole life
D) Level term
A) Decreasing term
When appropriate, the Colorado Commissioner of Insurance
reports a violation of insurance law to:
A) an appropriate district attorney.
B) the attorney general.
C) the state legislature.
D) the state police.
A) an appropriate district attorney.
To be licensed to sell both life and accident and health insurance
in Colorado, an applicant must complete:
, Page 4 of 79
A) 40 hours of prelicensing education.
B) 80 hours of prelicensing education.
C) 100 hours of prelicensing education.
D) 20 hours of prelicense education in both life and health
insurance, for a total of 40 hours.
C) 100 hours of prelicensing education
What is the usual tax treatment of individual life insurance?
A) Deductibility of premiums, non - taxable death benefit
B) Non - deductibility of premiums, nontaxable death benefit
C) Non - Deductibility of premiums, taxable death benefit
D) Deductibility of premiums, taxable death benefit
B) Non - deductibility of premiums, nontaxable death benefit
Money taken out of a modified endowment contract (MEC)
A) will result in the policy being voided
B) May be subject to unfavorable tax rules
C) is always received income tax free
D) is considered to be a return of premium
B) May be subject to unfavorable tax rules
