Texas State Exam Simulator - Life and Health Insurance (200
Questions Practice Exam)2024
An annuity promises that, if the annuitant dies before receiving payments equal to the correct value, the
payments will be continued to a beneficiary until an amount equal to the contract value has been paid.
This type of annuity is called
An installment Refund annuity
A Straight Life annuity
A Cash Refund annuity
A Joint Life annuity -CORRECT ANS-An installment Refund annuity
One becomes eligible for Social Security disability benefits after having been disabled for
3 months
5 months
6 months
12 months -CORRECT ANS-5 months
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?
Straight life accumulates faster than Limited-pay Life
20-Pay Life accumulates cash value faster than Straight Life
Cash value accumulation of both 20-Pay Life and Straight Life depend on the insurer's financial rating
20-Pay Life and Straight Life accumulate cash value at the same rate -CORRECT ANS-20-Pay Life
accumulates cash value faster than Straight Life
Who makes the legally enforceable promises in a unilateral insurance policy?
,Beneficiary
Insurance company
Insured
Applicant -CORRECT ANS-Insurance company
The Consideration clause in a life insurance policy indicates that a policyowner's consideration consists
of a completed application and
the initial premium
agreeing to a physical examination
delivery of policy
disclosure of any medical conditions -CORRECT ANS-the initial premium
Which parts of a life insurance policy are guaranteed to be true?
Rating
Representation
Statement
Warranty -CORRECT ANS-Warranty
A comprehensive major medical health insurance policy contains an Eligible Expenses provision which
identifies the types of health care services that are covered. All of the following health care services are
typically covered EXCEPT for
hospital charges
physician fees
experimental and investigative services
nursing services -CORRECT ANS-experimental and investigative services
,If a retiree on Medicare required five hospital stays in one year, which policy would provide the best
insurance for excess hospital expenses?
Long-term care
Indemnity
Medicare Supplement
Medicaid -CORRECT ANS-Medicare Supplement
S, while in the process of converting her group life insurance to an individual policy, dies. What happens
to the claim her beneficiary submits?
No benefits are payable under the Master contract
Full benefits are payable under the Master contract
Full benefits are payable under the converted policy
Benefits less required premium are payable under the converted policy -CORRECT ANS-Full benefits are
payable under the Master contract
All of the following are limited benefit plans EXCEPT
cancer policies
life insurance policies
dental policies
critical illness policies -CORRECT ANS-life insurance policies
A physician opens up a new practice and qualifies for a $7,000/month Disability Income policy. What
rider would the physician add if he wants the ability to increase his policy benefit as his practice and
income grow?
Extended Term rider
Cost of Living Adjustment rider
, Guaranteed Insurability Option rider
Waiver of Premium rider -CORRECT ANS-Guaranteed Insurability Option rider
An agent whose license has been revoked is required to
wait at least five years before applying for a new license
submit all previously written policies to the Commissioner of Insurance's office for servicing of the
accounts
cancel all policies currently in effect and advise the insureds to place them elsewhere
continue to service the existing accounts but not solicit new business -CORRECT ANS-wait at least five
years before applying for a new license
The benefits under a Disability Buy-Out policy are
normally paid in installments
taxable to the beneficiary
payable to the company or another shareholder
normally paid after a short elimination period -CORRECT ANS-payable to the company or another
shareholder
he Health Insurance Portability and Accountability Act (HIPAA) gives privacy protection for
insolvency
health information
financial information
overinsurance -CORRECT ANS-health information
How are surrender charges deducted in a life policy with a rear-end loaded provision?
Deducted from the death benefit
Questions Practice Exam)2024
An annuity promises that, if the annuitant dies before receiving payments equal to the correct value, the
payments will be continued to a beneficiary until an amount equal to the contract value has been paid.
This type of annuity is called
An installment Refund annuity
A Straight Life annuity
A Cash Refund annuity
A Joint Life annuity -CORRECT ANS-An installment Refund annuity
One becomes eligible for Social Security disability benefits after having been disabled for
3 months
5 months
6 months
12 months -CORRECT ANS-5 months
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?
Straight life accumulates faster than Limited-pay Life
20-Pay Life accumulates cash value faster than Straight Life
Cash value accumulation of both 20-Pay Life and Straight Life depend on the insurer's financial rating
20-Pay Life and Straight Life accumulate cash value at the same rate -CORRECT ANS-20-Pay Life
accumulates cash value faster than Straight Life
Who makes the legally enforceable promises in a unilateral insurance policy?
,Beneficiary
Insurance company
Insured
Applicant -CORRECT ANS-Insurance company
The Consideration clause in a life insurance policy indicates that a policyowner's consideration consists
of a completed application and
the initial premium
agreeing to a physical examination
delivery of policy
disclosure of any medical conditions -CORRECT ANS-the initial premium
Which parts of a life insurance policy are guaranteed to be true?
Rating
Representation
Statement
Warranty -CORRECT ANS-Warranty
A comprehensive major medical health insurance policy contains an Eligible Expenses provision which
identifies the types of health care services that are covered. All of the following health care services are
typically covered EXCEPT for
hospital charges
physician fees
experimental and investigative services
nursing services -CORRECT ANS-experimental and investigative services
,If a retiree on Medicare required five hospital stays in one year, which policy would provide the best
insurance for excess hospital expenses?
Long-term care
Indemnity
Medicare Supplement
Medicaid -CORRECT ANS-Medicare Supplement
S, while in the process of converting her group life insurance to an individual policy, dies. What happens
to the claim her beneficiary submits?
No benefits are payable under the Master contract
Full benefits are payable under the Master contract
Full benefits are payable under the converted policy
Benefits less required premium are payable under the converted policy -CORRECT ANS-Full benefits are
payable under the Master contract
All of the following are limited benefit plans EXCEPT
cancer policies
life insurance policies
dental policies
critical illness policies -CORRECT ANS-life insurance policies
A physician opens up a new practice and qualifies for a $7,000/month Disability Income policy. What
rider would the physician add if he wants the ability to increase his policy benefit as his practice and
income grow?
Extended Term rider
Cost of Living Adjustment rider
, Guaranteed Insurability Option rider
Waiver of Premium rider -CORRECT ANS-Guaranteed Insurability Option rider
An agent whose license has been revoked is required to
wait at least five years before applying for a new license
submit all previously written policies to the Commissioner of Insurance's office for servicing of the
accounts
cancel all policies currently in effect and advise the insureds to place them elsewhere
continue to service the existing accounts but not solicit new business -CORRECT ANS-wait at least five
years before applying for a new license
The benefits under a Disability Buy-Out policy are
normally paid in installments
taxable to the beneficiary
payable to the company or another shareholder
normally paid after a short elimination period -CORRECT ANS-payable to the company or another
shareholder
he Health Insurance Portability and Accountability Act (HIPAA) gives privacy protection for
insolvency
health information
financial information
overinsurance -CORRECT ANS-health information
How are surrender charges deducted in a life policy with a rear-end loaded provision?
Deducted from the death benefit
