California Life, Accident, and Health
State Exam
Cindy buys a 10-year certain annuity with an installment refund. After
receiving monthly payments for 5 years, Cindy dies. How many remaining
payments will the insurer make to her beneficiary?
- No payments
- 30 payments
✅✅-60 Payments
- 60 payments
- 120 payments -
An annuitant would like to determine the amount of an annuity distribution that
is exempt from taxation. What is used to calculate this?
- Mortality rate
- Exclusion ratio
✅✅-Exclusion ratio
- Morbidity rate
- Debt-to-Equity ratio -
The systematic liquidation of a sum of money is provided by a(n)
- annuity
- endowment contract
✅✅-annuity
- life insurance policy
- 1035 contract exchange -
Which of the following is NOT a feature of equity-indexed annuities?
- Offers long term inflation protection
- Offers a minimum guarantee rate
✅✅-Offers a
- Offers a maximum interest rate that increases annually
- Offers protection during a decline in the stock market -
maximum interest rate that increases annually
What kind of annuity pays income to two annuitants until their deaths?
- Period certain annuity
- Joint and survivor annuity
, ✅✅-Joint and survivor annuity
- Straight life annuity
- Installment refund -
A savings vehicle designed to first accumulate funds and then systematically
liquidates the funds is called a(n)
- immediate annuity
- deferred annuity
✅✅-deferred annuity
- endowment
- whole life policy -
An annuity which is backed by a life insurer's separate account is called a(n)
- equity indexed annuity
- variable annuity
✅✅
- immediate annuity
- 403(b) plan - -variable annuity
Which of the following is a contract that involves one party which indemnifies
another when a loss arises from an unknown event?
- Insurance policy
- Warranty arrangement
✅✅
- Indemnification arrangement
- Loss contract - -Insurance Policy
Which of the following is an insurer established by a parent company for the
purpose of insuring the parent company's loss exposures?
- Participating insurer
- Captive insurer
✅✅-Captive insurer
- Mutual insurer
- Fraternal insurer -
John owns an insurance policy that gives him the right to share in the insurer's
surplus. What kind of policy is this?
- Surplus
- Nonparticipating
- Participating
,- Contributory - ✅✅-Participating
One important function of an insurance company is to identify and sell to
potential customers. Which of these BEST describes this function?
- Reinsurance
- Underwriting
✅✅-Marketing
- Marketing
- Regulation -
When a mutual insurer becomes a stock company, the process is called
- Reinsurance
- Mutualization
✅✅-Demutualization
- Demutualization
- Reorganization -
What is a participating life insurance policy?
- Agreement that insurers two or more lives
- Agreement that allows two or more beneficiaries to share in the death benefit
- Contract that gives beneficiaries the right to participate in any dividends
✅✅
- Contract that allows the policyowner to receive a share of surplus in the form
of policy dividends - -Contract that allows the policyowner to receive a
share of surplus in the form of policy dividends
The elimination period is a disability income policy serves the same purpose
as
- a deductible
- coinsurance
✅✅-a deductible
- an elective indemnity
- waiver of premium -
Under a disability income insurance policy, which criteria must be met for
"bodily injury" to be classified as accidental?
- Only the result needed be of natural cause
- Only the cause need be accidental
- Both the injury and the cause need be accidental
, - The cause may be intentional, but the result must be accidental - ✅✅-The
cause may be intentional, but the result must be accidental
What are residual disability income insurance payments based on?
- A flat benefit amount stated in the policy
- 50% of the full disability amount
✅✅
- The amount of the insured's income is reduced by the disability
- The insured must be totally disabled - -The amount of the insured's
income is reduced by the disability
Dyan is considered partially disabled by her insurance company. Which of the
following BEST describes her situation?
- She is working part-time and receiving lost income under her long-term
disability benefit
- She has lost hearing in one ear because of an accident on the job
✅✅
- She is unable to work and receiving worker's compensation
- Her employer pays half of her disability benefit - -She is working
part-time and receiving lost income under her long-term disability benefit
An individual covered under a disability income policy may be eligible for a
partial disability benefit if
- the insured can perform some of their job activities on a part-time basis
- the insured cannot perform any of their job activities
✅✅
- the cause of disability was from from an accident only
- the insured is enrolled in a rehabilitation program - -the insured can
perform some of their job activities on a part-time basis
Which of the following could lower the premium of a proposed disability
income policy?
- Increasing the elimination period
- Decreasing the elimination period
- Increasing the benefit period
✅✅
- Selecting an "own-occupation" clause instead of an "any-occupation" clause
- -Increasing the elimination period
Which of the following is NOT a provision in a disability income policy?
State Exam
Cindy buys a 10-year certain annuity with an installment refund. After
receiving monthly payments for 5 years, Cindy dies. How many remaining
payments will the insurer make to her beneficiary?
- No payments
- 30 payments
✅✅-60 Payments
- 60 payments
- 120 payments -
An annuitant would like to determine the amount of an annuity distribution that
is exempt from taxation. What is used to calculate this?
- Mortality rate
- Exclusion ratio
✅✅-Exclusion ratio
- Morbidity rate
- Debt-to-Equity ratio -
The systematic liquidation of a sum of money is provided by a(n)
- annuity
- endowment contract
✅✅-annuity
- life insurance policy
- 1035 contract exchange -
Which of the following is NOT a feature of equity-indexed annuities?
- Offers long term inflation protection
- Offers a minimum guarantee rate
✅✅-Offers a
- Offers a maximum interest rate that increases annually
- Offers protection during a decline in the stock market -
maximum interest rate that increases annually
What kind of annuity pays income to two annuitants until their deaths?
- Period certain annuity
- Joint and survivor annuity
, ✅✅-Joint and survivor annuity
- Straight life annuity
- Installment refund -
A savings vehicle designed to first accumulate funds and then systematically
liquidates the funds is called a(n)
- immediate annuity
- deferred annuity
✅✅-deferred annuity
- endowment
- whole life policy -
An annuity which is backed by a life insurer's separate account is called a(n)
- equity indexed annuity
- variable annuity
✅✅
- immediate annuity
- 403(b) plan - -variable annuity
Which of the following is a contract that involves one party which indemnifies
another when a loss arises from an unknown event?
- Insurance policy
- Warranty arrangement
✅✅
- Indemnification arrangement
- Loss contract - -Insurance Policy
Which of the following is an insurer established by a parent company for the
purpose of insuring the parent company's loss exposures?
- Participating insurer
- Captive insurer
✅✅-Captive insurer
- Mutual insurer
- Fraternal insurer -
John owns an insurance policy that gives him the right to share in the insurer's
surplus. What kind of policy is this?
- Surplus
- Nonparticipating
- Participating
,- Contributory - ✅✅-Participating
One important function of an insurance company is to identify and sell to
potential customers. Which of these BEST describes this function?
- Reinsurance
- Underwriting
✅✅-Marketing
- Marketing
- Regulation -
When a mutual insurer becomes a stock company, the process is called
- Reinsurance
- Mutualization
✅✅-Demutualization
- Demutualization
- Reorganization -
What is a participating life insurance policy?
- Agreement that insurers two or more lives
- Agreement that allows two or more beneficiaries to share in the death benefit
- Contract that gives beneficiaries the right to participate in any dividends
✅✅
- Contract that allows the policyowner to receive a share of surplus in the form
of policy dividends - -Contract that allows the policyowner to receive a
share of surplus in the form of policy dividends
The elimination period is a disability income policy serves the same purpose
as
- a deductible
- coinsurance
✅✅-a deductible
- an elective indemnity
- waiver of premium -
Under a disability income insurance policy, which criteria must be met for
"bodily injury" to be classified as accidental?
- Only the result needed be of natural cause
- Only the cause need be accidental
- Both the injury and the cause need be accidental
, - The cause may be intentional, but the result must be accidental - ✅✅-The
cause may be intentional, but the result must be accidental
What are residual disability income insurance payments based on?
- A flat benefit amount stated in the policy
- 50% of the full disability amount
✅✅
- The amount of the insured's income is reduced by the disability
- The insured must be totally disabled - -The amount of the insured's
income is reduced by the disability
Dyan is considered partially disabled by her insurance company. Which of the
following BEST describes her situation?
- She is working part-time and receiving lost income under her long-term
disability benefit
- She has lost hearing in one ear because of an accident on the job
✅✅
- She is unable to work and receiving worker's compensation
- Her employer pays half of her disability benefit - -She is working
part-time and receiving lost income under her long-term disability benefit
An individual covered under a disability income policy may be eligible for a
partial disability benefit if
- the insured can perform some of their job activities on a part-time basis
- the insured cannot perform any of their job activities
✅✅
- the cause of disability was from from an accident only
- the insured is enrolled in a rehabilitation program - -the insured can
perform some of their job activities on a part-time basis
Which of the following could lower the premium of a proposed disability
income policy?
- Increasing the elimination period
- Decreasing the elimination period
- Increasing the benefit period
✅✅
- Selecting an "own-occupation" clause instead of an "any-occupation" clause
- -Increasing the elimination period
Which of the following is NOT a provision in a disability income policy?
