Alabama Life & Health Insurance Exam
ACTUAL QUESTIONS AND CORRECT
ANSWERS
Term Insurance - Correct answers✔Temporary protection because it only provides coverage for a
specific period of time. Also known as pure life insurance
Term insurance provides what is known as _________________ - Correct answers✔pure death
protection
Term insurance provides the greatest amount of coverage for the _______________ - Correct
answers✔lowest premium
Term insurance has no ____________ - Correct answers✔cash value
Three basic types of term coverage available, based on how the face amount (death benefit)
changes during the policy term: - Correct answers✔1. Level
2. Increasing
3. Decreasing
Level term insurance - Correct answers✔Most common type of temporary protection purchased.
The word level refers to the death benefit that does not change throughout the life of the policy.
Level in level term insurance refers to the ________________, which does NOT change -
Correct answers✔death benefit
Annually Renewable Term (ART) - Correct answers✔the purest form of term insurance. The
death benefit remains level, and the policy may be guaranteed to be renewable each year without
, proof of insurability, but the premium increases annually according to the attained age, as the
probability of death increases.
Level Premium Term - Correct answers✔provides a level death benefit and a level premium
during the policy term.
Increasing term - Correct answers✔features level premiums and a death benefit that increases
each year over the duration of the policy term.
Decreasing Term - Correct answers✔policies feature a level premium and a death benefit that
decreases each year over the duration of the policy term. Nonrenewable
Renewable Provision - Correct answers✔allows the policyowner the right to renew the coverage
at the expiration date without evidence of insurability
Convertible Provision - Correct answers✔provides the policyowner with the right to convert the
policy to a permanent insurance policy without evidence of insurability
Re-entry Option - Correct answers✔An option that gives the insured the opportunity for a
discounted premium rate with proof of insurability
Permanent Life Insurance - Correct answers✔A general term used to refer to various forms of
life insurance policies that build cash value and remain in effect for the entire life of the insured
as long as the premium is paid.
Most common type of permanent insurance: - Correct answers✔Whole Life
ACTUAL QUESTIONS AND CORRECT
ANSWERS
Term Insurance - Correct answers✔Temporary protection because it only provides coverage for a
specific period of time. Also known as pure life insurance
Term insurance provides what is known as _________________ - Correct answers✔pure death
protection
Term insurance provides the greatest amount of coverage for the _______________ - Correct
answers✔lowest premium
Term insurance has no ____________ - Correct answers✔cash value
Three basic types of term coverage available, based on how the face amount (death benefit)
changes during the policy term: - Correct answers✔1. Level
2. Increasing
3. Decreasing
Level term insurance - Correct answers✔Most common type of temporary protection purchased.
The word level refers to the death benefit that does not change throughout the life of the policy.
Level in level term insurance refers to the ________________, which does NOT change -
Correct answers✔death benefit
Annually Renewable Term (ART) - Correct answers✔the purest form of term insurance. The
death benefit remains level, and the policy may be guaranteed to be renewable each year without
, proof of insurability, but the premium increases annually according to the attained age, as the
probability of death increases.
Level Premium Term - Correct answers✔provides a level death benefit and a level premium
during the policy term.
Increasing term - Correct answers✔features level premiums and a death benefit that increases
each year over the duration of the policy term.
Decreasing Term - Correct answers✔policies feature a level premium and a death benefit that
decreases each year over the duration of the policy term. Nonrenewable
Renewable Provision - Correct answers✔allows the policyowner the right to renew the coverage
at the expiration date without evidence of insurability
Convertible Provision - Correct answers✔provides the policyowner with the right to convert the
policy to a permanent insurance policy without evidence of insurability
Re-entry Option - Correct answers✔An option that gives the insured the opportunity for a
discounted premium rate with proof of insurability
Permanent Life Insurance - Correct answers✔A general term used to refer to various forms of
life insurance policies that build cash value and remain in effect for the entire life of the insured
as long as the premium is paid.
Most common type of permanent insurance: - Correct answers✔Whole Life
