Powered by ExamFX - Online Training & Assessment
Review Missed Questions
Languages: English Español
Take some time to review the questions you missed in
the session you just completed.
This list shows all of the questions that you missed in the session you just completed. The answers you selected
are in bold. The correct answers are highlighted in green.
#3. A life insurance policy has a legal purpose if both of which of the following elements exist?
a) Underwriting and reciprocity
b) Offer and counteroffer
c) Policyowners and named beneficiaries
d) Insurable interest and consent
To ensure legal purpose of a life insurance policy, it must have both insurable interest and consent.
The life insurance policy clause that prevents an insurance company from denying payment of a death claim
#4. after a specified period of time is known as the
a) Incontestability clause.
b) Reinstatement clause.
c) Insuring clause.
d) Misstatement of Age clause.
If an insurer wishes to contest any statements on an application, they must do so within the first two years.
#5. The main difference between immediate and deferred annuities is
a) The amount of each payment.
b) When the income payments begin.
c) How the annuity is purchased.
d) The number of insureds.
The main difference between immediate and deferred annuities is when the income payments begin.
Immediate annuities will begin payments within the first year, while deferred annuities will not begin
payments until sometime after the first year.
#6. What license or licenses are required to sell variable annuities?
a) Only a life insurance license
b) Only a securities license
c) No license is required
d) Both a life insurance license and a securities license
Agents are required to have both a life insurance license and a securities license to sell variable annuities.
, #7. Which of the following is INCORRECT regarding a $100,000 20-year level term policy?
a) The policy will expire at the end of the 20-year period.
b) At the end of 20 years, the policy’s cash value will equal $100,000.
c) The policy premiums will remain level for 20 years.
d) If the insured dies before the policy expired, the beneficiary will receive $100,000.
Term policies do not develop cash values. All the other statements are true.
An insured purchased a life policy in 2010 and died in 2017. The insurance company discovers at that time
#8. that the insured had misstated information during the application process. What can they do?
a) Refuse to pay the death benefit because of the misstatement on the application
b) Pay a decreased death benefit
c) Sue for the right to not pay the death benefit
d) Pay the death benefit
The incontestability clause prevents an insurer from denying a claim due to statements in an application after
the policy has been in force for 2 years, even on the basis of a material misstatement of facts or
concealment of a material fact.
#10. Which two terms are associated directly with the premium?
a) Fixed or variable
b) Term or permanent
c) Renewable or convertible
d) Level or flexible
A level premium is one in which the premium payment never changes. A flexible premium is found in
Universal life policies where the insured changes their premium payment.
#11. Which of the following is the closest term to an authorized insurer?
a) Licensed
b) Legal
c) Admitted
d) Certified
Insurers who meet the state's financial requirements and are approved to transact business in the state are
considered authorized or admitted into the state as a legal insurer.
The sole beneficiary of a life insurance policy dies before the insured. If the policyowner fails to change the
#12. beneficiary before the insured's death, the proceeds of the policy will go to
a) The state.
b) The beneficiary's estate.
c) The insured's estate.
d) Probate.
In the absence of a viable beneficiary, proceeds will be paid to the estate of the insured.
, The full premium was submitted with the application for life insurance, and the policy was issued two weeks
#13. later as requested. When does the policy coverage become effective?
a) As of the application date
b) As of the policy delivery date
c) As of the first of the month after the policy issue
d) As of the policy issue date
If the full premium was submitted with the application and the policy was issued as requested, the policy
coverage effective date would generally coincide with the date of application.
#16. Which type of life insurance policy generates immediate cash value?
a) Single Premium
b) Level Term
c) Decreasing Term
d) Continuous Premium
Like other types of whole life policies, Single Premium Whole Life (SPWL) endows for the face amount of the
policy if the insured lives until the age of 100. The distinguishing feature of a SPWL is the fact that it
generates immediate cash value, due to the lump-sum payment made to the insurer.
#17. What is the maximum penalty for habitual willful noncompliance with the Fair Credit Reporting Act?
a) $1,000
b) $100 per violation
c) Revocation of license
d) $2,500
An individual who willfully violates this Act enough to constitute a general pattern or business practice will be
subject to a penalty of up to $2,500.
#19. What are the two components of a universal policy?
a) Insurance and investments
b) Mortality cost and interest
c) Separate account and policy loans
d) Insurance and cash account
A universal policy has two components: an insurance component and a cash account. The insurance
component of a universal life policy is always annual renewable term insurance. The cash account
accumulates on a tax deferred basis each year and earns either the guaranteed contract rate or the current
rate, whichever is higher.
An insured under a life insurance policy has been diagnosed with a terminal illness and has 6 months to live.
The insured knows that his financial state will worsen even more with the upcoming medical expenses. What
#21. option could the insured utilize?
a) Viatical settlement
b) Estate liquidation
c) Nonpayment of premium
d) Change of beneficiary
A viatical statement allows an insured with a life-threatening condition to sell the existing policy in order to
receive benefits when they are most needed. Viators typically receive a percentage of the policy’s face value
from the person who purchases the policy.
Review Missed Questions
Languages: English Español
Take some time to review the questions you missed in
the session you just completed.
This list shows all of the questions that you missed in the session you just completed. The answers you selected
are in bold. The correct answers are highlighted in green.
#3. A life insurance policy has a legal purpose if both of which of the following elements exist?
a) Underwriting and reciprocity
b) Offer and counteroffer
c) Policyowners and named beneficiaries
d) Insurable interest and consent
To ensure legal purpose of a life insurance policy, it must have both insurable interest and consent.
The life insurance policy clause that prevents an insurance company from denying payment of a death claim
#4. after a specified period of time is known as the
a) Incontestability clause.
b) Reinstatement clause.
c) Insuring clause.
d) Misstatement of Age clause.
If an insurer wishes to contest any statements on an application, they must do so within the first two years.
#5. The main difference between immediate and deferred annuities is
a) The amount of each payment.
b) When the income payments begin.
c) How the annuity is purchased.
d) The number of insureds.
The main difference between immediate and deferred annuities is when the income payments begin.
Immediate annuities will begin payments within the first year, while deferred annuities will not begin
payments until sometime after the first year.
#6. What license or licenses are required to sell variable annuities?
a) Only a life insurance license
b) Only a securities license
c) No license is required
d) Both a life insurance license and a securities license
Agents are required to have both a life insurance license and a securities license to sell variable annuities.
, #7. Which of the following is INCORRECT regarding a $100,000 20-year level term policy?
a) The policy will expire at the end of the 20-year period.
b) At the end of 20 years, the policy’s cash value will equal $100,000.
c) The policy premiums will remain level for 20 years.
d) If the insured dies before the policy expired, the beneficiary will receive $100,000.
Term policies do not develop cash values. All the other statements are true.
An insured purchased a life policy in 2010 and died in 2017. The insurance company discovers at that time
#8. that the insured had misstated information during the application process. What can they do?
a) Refuse to pay the death benefit because of the misstatement on the application
b) Pay a decreased death benefit
c) Sue for the right to not pay the death benefit
d) Pay the death benefit
The incontestability clause prevents an insurer from denying a claim due to statements in an application after
the policy has been in force for 2 years, even on the basis of a material misstatement of facts or
concealment of a material fact.
#10. Which two terms are associated directly with the premium?
a) Fixed or variable
b) Term or permanent
c) Renewable or convertible
d) Level or flexible
A level premium is one in which the premium payment never changes. A flexible premium is found in
Universal life policies where the insured changes their premium payment.
#11. Which of the following is the closest term to an authorized insurer?
a) Licensed
b) Legal
c) Admitted
d) Certified
Insurers who meet the state's financial requirements and are approved to transact business in the state are
considered authorized or admitted into the state as a legal insurer.
The sole beneficiary of a life insurance policy dies before the insured. If the policyowner fails to change the
#12. beneficiary before the insured's death, the proceeds of the policy will go to
a) The state.
b) The beneficiary's estate.
c) The insured's estate.
d) Probate.
In the absence of a viable beneficiary, proceeds will be paid to the estate of the insured.
, The full premium was submitted with the application for life insurance, and the policy was issued two weeks
#13. later as requested. When does the policy coverage become effective?
a) As of the application date
b) As of the policy delivery date
c) As of the first of the month after the policy issue
d) As of the policy issue date
If the full premium was submitted with the application and the policy was issued as requested, the policy
coverage effective date would generally coincide with the date of application.
#16. Which type of life insurance policy generates immediate cash value?
a) Single Premium
b) Level Term
c) Decreasing Term
d) Continuous Premium
Like other types of whole life policies, Single Premium Whole Life (SPWL) endows for the face amount of the
policy if the insured lives until the age of 100. The distinguishing feature of a SPWL is the fact that it
generates immediate cash value, due to the lump-sum payment made to the insurer.
#17. What is the maximum penalty for habitual willful noncompliance with the Fair Credit Reporting Act?
a) $1,000
b) $100 per violation
c) Revocation of license
d) $2,500
An individual who willfully violates this Act enough to constitute a general pattern or business practice will be
subject to a penalty of up to $2,500.
#19. What are the two components of a universal policy?
a) Insurance and investments
b) Mortality cost and interest
c) Separate account and policy loans
d) Insurance and cash account
A universal policy has two components: an insurance component and a cash account. The insurance
component of a universal life policy is always annual renewable term insurance. The cash account
accumulates on a tax deferred basis each year and earns either the guaranteed contract rate or the current
rate, whichever is higher.
An insured under a life insurance policy has been diagnosed with a terminal illness and has 6 months to live.
The insured knows that his financial state will worsen even more with the upcoming medical expenses. What
#21. option could the insured utilize?
a) Viatical settlement
b) Estate liquidation
c) Nonpayment of premium
d) Change of beneficiary
A viatical statement allows an insured with a life-threatening condition to sell the existing policy in order to
receive benefits when they are most needed. Viators typically receive a percentage of the policy’s face value
from the person who purchases the policy.
