PearsonVue Life Insurance Practice Exam 75 CORRECT
QUESTIONS AND ANSWERS/ LATEST UPDATE WITH SOME
PRACTICE EXAM IN IT 2025 GRADED A+ {TESTBANK}
The PRIMARY reason for selecting a Variable Whole Life policy instead of a traditional
Whole Life policy is that the Variable Whole Life policy: - CORRECT ANSWER has
the potential to earn a higher rate of return on the cash value
Which of the following statements is CORRECT about the Paid-Up Additions in a
participating Whole Life policy? - CORRECT ANSWER They are purchased on an
attained age basis.
Which of the following statements is CORRECT about Group Life conversion
privileges? - CORRECT ANSWER Death during the conversion period is covered
even if the departing employee chose not to convert the policy.
If an insured commits suicide after the Suicide clause in the insured's life insurance
policy has expired, the insurer will take which of the following actions? - CORRECT
ANSWER Pay the Death benefit
If a policy contains a Guaranteed Insurability rider, the insured has the right to
purchase: - CORRECT ANSWER additional coverage at specified ages
If life insurance policy applicant is classified as a substandard risk, the insurance
company will MOST likely: - CORRECT ANSWER charge an extra premium
P wants to name her husband as the beneficiary of her life policy. However, she wishes
to retain all of the rights of ownership. P should have her husband named as the: -
CORRECT ANSWER revocable beneficiary
Which of the following features allows an insurance policy to remain in force for a
specified number of days beyond the premium due date? - CORRECT ANSWER
Grace Period provision
In life insurance, insurable interest must exist at the time the: - CORRECT ANSWER
producer writes an application on a proposed insured
Which of the following terms refers to the transfer of some or all of the ownership rights
of a life insurance policy from one individual to another? - CORRECT ANSWER
Assignment
Which of the following statements about a Renewable Term policy is CORRECT? -
CORRECT ANSWER It is renewable at the option of the insured.
, Two business partners own life insurance on each other. If one partner dies, which of
the following contracts will allow the other partner to buy 100 percent of the business
interest? - CORRECT ANSWER Buy and Sell Agreement
An insured intentionally understates her age on her application for a life policy. At death,
the insurer will take which of the following actions? - CORRECT ANSWER Pay a
reduced Death benefit based on the insured's actual age
An applicant's statements on an application are considered to be legal: - CORRECT
ANSWER representations
A contract that promises to pay an income to an insured until his/her death is called: -
CORRECT ANSWER Life Annuity
An employer can deduct premium payments as an ordinary business expense for which
of the following life coverages? - CORRECT ANSWER Group
Which of the following annuities would BEST suit the needs of a 35-year-old factory
worker who is concerned about inflation and wants to establish a retirement plan? -
CORRECT ANSWER A Flexible Premium Variable Annuity
A client needs a substantial amount of protection but has limited financial resources.
Which of the following insurance policies would BEST meet the client's needs? -
CORRECT ANSWER Term Life
An applicant for life insurance may question the validity and source of any consumer
information developed under the: - CORRECT ANSWER Fair Credit Reporting Act
(Insurance Information and Privacy Protection Act)
Which of the following policy provisions provides for continuation of coverage despite
nonpayment of premiums? - CORRECT ANSWER Nonforfeiture Option
Federal income tax laws generally treat proceeds of life insurance policies as: -
CORRECT ANSWER nontaxable
When a producer submits an insurance application to the company, the producer must
take all of the following actions EXCEP - CORRECT ANSWER submit a completed
medical information report
Which of the following policy provisions states that the application is part of the policy? -
CORRECT ANSWER Entire contract
QUESTIONS AND ANSWERS/ LATEST UPDATE WITH SOME
PRACTICE EXAM IN IT 2025 GRADED A+ {TESTBANK}
The PRIMARY reason for selecting a Variable Whole Life policy instead of a traditional
Whole Life policy is that the Variable Whole Life policy: - CORRECT ANSWER has
the potential to earn a higher rate of return on the cash value
Which of the following statements is CORRECT about the Paid-Up Additions in a
participating Whole Life policy? - CORRECT ANSWER They are purchased on an
attained age basis.
Which of the following statements is CORRECT about Group Life conversion
privileges? - CORRECT ANSWER Death during the conversion period is covered
even if the departing employee chose not to convert the policy.
If an insured commits suicide after the Suicide clause in the insured's life insurance
policy has expired, the insurer will take which of the following actions? - CORRECT
ANSWER Pay the Death benefit
If a policy contains a Guaranteed Insurability rider, the insured has the right to
purchase: - CORRECT ANSWER additional coverage at specified ages
If life insurance policy applicant is classified as a substandard risk, the insurance
company will MOST likely: - CORRECT ANSWER charge an extra premium
P wants to name her husband as the beneficiary of her life policy. However, she wishes
to retain all of the rights of ownership. P should have her husband named as the: -
CORRECT ANSWER revocable beneficiary
Which of the following features allows an insurance policy to remain in force for a
specified number of days beyond the premium due date? - CORRECT ANSWER
Grace Period provision
In life insurance, insurable interest must exist at the time the: - CORRECT ANSWER
producer writes an application on a proposed insured
Which of the following terms refers to the transfer of some or all of the ownership rights
of a life insurance policy from one individual to another? - CORRECT ANSWER
Assignment
Which of the following statements about a Renewable Term policy is CORRECT? -
CORRECT ANSWER It is renewable at the option of the insured.
, Two business partners own life insurance on each other. If one partner dies, which of
the following contracts will allow the other partner to buy 100 percent of the business
interest? - CORRECT ANSWER Buy and Sell Agreement
An insured intentionally understates her age on her application for a life policy. At death,
the insurer will take which of the following actions? - CORRECT ANSWER Pay a
reduced Death benefit based on the insured's actual age
An applicant's statements on an application are considered to be legal: - CORRECT
ANSWER representations
A contract that promises to pay an income to an insured until his/her death is called: -
CORRECT ANSWER Life Annuity
An employer can deduct premium payments as an ordinary business expense for which
of the following life coverages? - CORRECT ANSWER Group
Which of the following annuities would BEST suit the needs of a 35-year-old factory
worker who is concerned about inflation and wants to establish a retirement plan? -
CORRECT ANSWER A Flexible Premium Variable Annuity
A client needs a substantial amount of protection but has limited financial resources.
Which of the following insurance policies would BEST meet the client's needs? -
CORRECT ANSWER Term Life
An applicant for life insurance may question the validity and source of any consumer
information developed under the: - CORRECT ANSWER Fair Credit Reporting Act
(Insurance Information and Privacy Protection Act)
Which of the following policy provisions provides for continuation of coverage despite
nonpayment of premiums? - CORRECT ANSWER Nonforfeiture Option
Federal income tax laws generally treat proceeds of life insurance policies as: -
CORRECT ANSWER nontaxable
When a producer submits an insurance application to the company, the producer must
take all of the following actions EXCEP - CORRECT ANSWER submit a completed
medical information report
Which of the following policy provisions states that the application is part of the policy? -
CORRECT ANSWER Entire contract
