Alabama Life and Health Exam
Questions & Answers Correct 100%
(RATED A+)
In reference to the standard Medicare Supplement benefits plans, what does the term
standard mean?
a) All plans must include basic benefits A-N.
b) Coverage options and conditions are developed for average individuals.
c) All providers will have the same coverage options and conditions for each plan.
d) Coverage options and conditions comply with the law, but will vary from provider to
provider. - ANSWERSC
Which of the following is true regarding a single life settlement option?
a) Payments continue until the entire principal is exhausted.
b) Proceeds are paid out in a lump sum.
c) It provides income for a specified period of time.
d) It provides income the beneficiary cannot outlive. - ANSWERSD
What is the maximum penalty for habitual willful noncompliance with the Fair Credit
Reporting Act?
a) Revocation of license
b) $2,500
c) $1,000
d) $100 per violation - ANSWERSB
Which of the following is NOT an allowable 1035 exchange?
a) A whole life insurance policy is exchanged for a term insurance policy.
b) A whole life insurance policy is exchanged for a Universal life insurance policy.
c) An annuity is exchanged for another annuity.
d) A life insurance policy is exchanged for an annuity. - ANSWERSA
Most insurers issue health insurance policies for delivery in many states. Because each
state regulates and mandates the requirement for policies delivered to their residents,
instead of having a policy form for each state, the insurer attaches
a) A waiver of other state requirements.
b) Nothing. An insurer's policy only needs to conform to the regulations of the state
where the insurer is domiciled.
c) Conformity with State Statutes provision.
d) Miscellaneous optional provision. - ANSWERSC
Which concept is associated with "exclusion ratio"?
, a) Dividend distribution
b) How exclusion riders affect an insurance premium
c) Policy provisions
d) Annuities payments - ANSWERSD
When a homeowner purchases insurance on his home, what risk management
technique is he practicing?
a) Retention
b) Transfer
c) Avoidance
d) Sharing - ANSWERSB
Officers who manage stock insurance companies are
a) Appointed by the Department of Insurance.
b) Elected by the stockholders.
c) Hired through an application process.
d) Appointed by other company officials. - ANSWERSB
At what point must an Outline of Coverage be delivered?
a) At the time of application or upon delivery of the policy
b) At any point up to 30 days after policy delivery
c) At the time of application only
d) Upon delivery of the policy only - ANSWERSA
Which of the following is TRUE about a class designation?
a) Beneficiaries must be part of the insured's immediate family.
b) It is not allowed.
c) It determines the succession of beneficiaries.
d) Beneficiaries are not identified by name. - ANSWERSD
Which of the following is NOT true regarding the accumulation period of an annuity?
a) It would not occur in a deferred annuity.
b) It is the period during which the annuity payments earn interest.
c) It is the period over which the annuitant makes payments into an annuity.
d) It is also known as the pay-in period. - ANSWERSA
All of the following are true of key person insurance EXCEPT
a) The plan is funded by permanent insurance only.
b) There is no limitation on the number of key employee plans in force at any one time.
c) The employer is the owner, payor and beneficiary of the policy.
d) The key employee is the insured. - ANSWERSA
An applicant buys a nonqualified annuity, but dies before the starting date. For which of
the following beneficiaries would the contract's interest NOT be taxable?
a) Charitable Organization
b) Dependents
Questions & Answers Correct 100%
(RATED A+)
In reference to the standard Medicare Supplement benefits plans, what does the term
standard mean?
a) All plans must include basic benefits A-N.
b) Coverage options and conditions are developed for average individuals.
c) All providers will have the same coverage options and conditions for each plan.
d) Coverage options and conditions comply with the law, but will vary from provider to
provider. - ANSWERSC
Which of the following is true regarding a single life settlement option?
a) Payments continue until the entire principal is exhausted.
b) Proceeds are paid out in a lump sum.
c) It provides income for a specified period of time.
d) It provides income the beneficiary cannot outlive. - ANSWERSD
What is the maximum penalty for habitual willful noncompliance with the Fair Credit
Reporting Act?
a) Revocation of license
b) $2,500
c) $1,000
d) $100 per violation - ANSWERSB
Which of the following is NOT an allowable 1035 exchange?
a) A whole life insurance policy is exchanged for a term insurance policy.
b) A whole life insurance policy is exchanged for a Universal life insurance policy.
c) An annuity is exchanged for another annuity.
d) A life insurance policy is exchanged for an annuity. - ANSWERSA
Most insurers issue health insurance policies for delivery in many states. Because each
state regulates and mandates the requirement for policies delivered to their residents,
instead of having a policy form for each state, the insurer attaches
a) A waiver of other state requirements.
b) Nothing. An insurer's policy only needs to conform to the regulations of the state
where the insurer is domiciled.
c) Conformity with State Statutes provision.
d) Miscellaneous optional provision. - ANSWERSC
Which concept is associated with "exclusion ratio"?
, a) Dividend distribution
b) How exclusion riders affect an insurance premium
c) Policy provisions
d) Annuities payments - ANSWERSD
When a homeowner purchases insurance on his home, what risk management
technique is he practicing?
a) Retention
b) Transfer
c) Avoidance
d) Sharing - ANSWERSB
Officers who manage stock insurance companies are
a) Appointed by the Department of Insurance.
b) Elected by the stockholders.
c) Hired through an application process.
d) Appointed by other company officials. - ANSWERSB
At what point must an Outline of Coverage be delivered?
a) At the time of application or upon delivery of the policy
b) At any point up to 30 days after policy delivery
c) At the time of application only
d) Upon delivery of the policy only - ANSWERSA
Which of the following is TRUE about a class designation?
a) Beneficiaries must be part of the insured's immediate family.
b) It is not allowed.
c) It determines the succession of beneficiaries.
d) Beneficiaries are not identified by name. - ANSWERSD
Which of the following is NOT true regarding the accumulation period of an annuity?
a) It would not occur in a deferred annuity.
b) It is the period during which the annuity payments earn interest.
c) It is the period over which the annuitant makes payments into an annuity.
d) It is also known as the pay-in period. - ANSWERSA
All of the following are true of key person insurance EXCEPT
a) The plan is funded by permanent insurance only.
b) There is no limitation on the number of key employee plans in force at any one time.
c) The employer is the owner, payor and beneficiary of the policy.
d) The key employee is the insured. - ANSWERSA
An applicant buys a nonqualified annuity, but dies before the starting date. For which of
the following beneficiaries would the contract's interest NOT be taxable?
a) Charitable Organization
b) Dependents
