Montana - Life Insurance
Comprehensive Resource To Help You Ace 2026-2027 Exams
Includes Frequently Tested Questions With ELABORATED
100% Correct COMPLETE SOLUTIONS
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1. The part of a life insurance policy guaranteed to be true is called a(n)?
- Correct Answer: Warranty
2. Which of the following best describes a warranty?
- Correct Answer: Statements guaranteed to be true
3. If a contract of adhesion contains complicated language, to whom would the
interpretation be in favor of? In a contract of adhesion, any confusing language
would be interpreted in the favor of?
- Correct Answer: The insured
4. A policy of adhesion can only be modified by whom?
- Correct Answer: The insurance company
5. Stranger Originated Life Insurance (STOLI) has been found to be in violation of
which of the contractual elements?
,- Correct Answer: Legal Purpose (Insurable Interest)
6. Which of these characteristics is consistent with straight life policy?
- Correct Answer: Premiums are payable for as long as there is insurance
coverage in force.
7. All of these are characteristics of an Adjustable Life policy EXCEPT?
- Correct Answer: Face amount can be adjusted using policy dividends.
8. How long does the coverage normally remain on a limited-pay life policy?
- Correct Answer: Age 100
9. Which type of policy is considered to be overfunded, as stated by IRS
guidelines?
- Correct Answer: Modified Endowment Contract
10. Additional coverage can be added to a Whole Life policy by adding a(n)?
- Correct Answer: Decreasing term rider
11. A(n) _______ term life policy is normally used when covering an insured's
mortgage balance.
- Correct Answer: Decreasing
,12. Which of the following features of a group Term Life policy enables an
individual to leave the group and continue his or her insurance without providing
evidence of insurability?
- Correct Answer: *Conversion privilege
(The conversion privilege allows an individual to leave the group term plan and
continue his or her insurance without providing evidence of insurability.)
13. Which of the following actions is NOT possible with a Universal Life policy?
Premiums may be applied as a credit against income tax
14. Which of these statements describe a Modified Endowment Contract (MEC)?
Exceeds the maximum amount of premium that can be paid into a policy and still
have it recognized as a life insurance contract.
15. Credit Life insurance is?
Issued in an amount not to exceed the amount of the loan.
16. A potential client, age 40, would like to purchase a Whole Life policy that will
accumulate cash value at a faster rate in the early years of the policy. Which of
these statements made by the producer would be correct?
20-pay life accumulates cash value faster than straight life
17. Which of the following types of policies pays a benefit if the insured goes
blind?
AD&D
, 18. Under a Renewable Term policy
The renewal premium is calculated on the basis of the insured's attained age
19. A Limited-Pay Life policy has?
premium payments limited to a specified number of years.
20. D needs life insurance that provides coverage for only a limited amount of
time while also paying the lowest possible premium. What kind of policy is
needed?
level term
21. Which policy requires an agent to register with the National Association of
Securities Dealers (NASD) before selling?
variable life
22. What type of life insurance incorporates flexible premiums and an adjustable
death benefit?
Universal life insurance
23. Which of these types of insurance allows policyowner to have level premiums
and to also choose from selection of investment options?
Variable life insurance
25. All of these statements about Equity Indexed Life Insurance are correct
EXCEPT?
The premiums can be lowered or raised, based on investment performance.
Comprehensive Resource To Help You Ace 2026-2027 Exams
Includes Frequently Tested Questions With ELABORATED
100% Correct COMPLETE SOLUTIONS
Guaranteed Pass First Attempt!! Current Update!!
Instant Download Pdf
1. The part of a life insurance policy guaranteed to be true is called a(n)?
- Correct Answer: Warranty
2. Which of the following best describes a warranty?
- Correct Answer: Statements guaranteed to be true
3. If a contract of adhesion contains complicated language, to whom would the
interpretation be in favor of? In a contract of adhesion, any confusing language
would be interpreted in the favor of?
- Correct Answer: The insured
4. A policy of adhesion can only be modified by whom?
- Correct Answer: The insurance company
5. Stranger Originated Life Insurance (STOLI) has been found to be in violation of
which of the contractual elements?
,- Correct Answer: Legal Purpose (Insurable Interest)
6. Which of these characteristics is consistent with straight life policy?
- Correct Answer: Premiums are payable for as long as there is insurance
coverage in force.
7. All of these are characteristics of an Adjustable Life policy EXCEPT?
- Correct Answer: Face amount can be adjusted using policy dividends.
8. How long does the coverage normally remain on a limited-pay life policy?
- Correct Answer: Age 100
9. Which type of policy is considered to be overfunded, as stated by IRS
guidelines?
- Correct Answer: Modified Endowment Contract
10. Additional coverage can be added to a Whole Life policy by adding a(n)?
- Correct Answer: Decreasing term rider
11. A(n) _______ term life policy is normally used when covering an insured's
mortgage balance.
- Correct Answer: Decreasing
,12. Which of the following features of a group Term Life policy enables an
individual to leave the group and continue his or her insurance without providing
evidence of insurability?
- Correct Answer: *Conversion privilege
(The conversion privilege allows an individual to leave the group term plan and
continue his or her insurance without providing evidence of insurability.)
13. Which of the following actions is NOT possible with a Universal Life policy?
Premiums may be applied as a credit against income tax
14. Which of these statements describe a Modified Endowment Contract (MEC)?
Exceeds the maximum amount of premium that can be paid into a policy and still
have it recognized as a life insurance contract.
15. Credit Life insurance is?
Issued in an amount not to exceed the amount of the loan.
16. A potential client, age 40, would like to purchase a Whole Life policy that will
accumulate cash value at a faster rate in the early years of the policy. Which of
these statements made by the producer would be correct?
20-pay life accumulates cash value faster than straight life
17. Which of the following types of policies pays a benefit if the insured goes
blind?
AD&D
, 18. Under a Renewable Term policy
The renewal premium is calculated on the basis of the insured's attained age
19. A Limited-Pay Life policy has?
premium payments limited to a specified number of years.
20. D needs life insurance that provides coverage for only a limited amount of
time while also paying the lowest possible premium. What kind of policy is
needed?
level term
21. Which policy requires an agent to register with the National Association of
Securities Dealers (NASD) before selling?
variable life
22. What type of life insurance incorporates flexible premiums and an adjustable
death benefit?
Universal life insurance
23. Which of these types of insurance allows policyowner to have level premiums
and to also choose from selection of investment options?
Variable life insurance
25. All of these statements about Equity Indexed Life Insurance are correct
EXCEPT?
The premiums can be lowered or raised, based on investment performance.
