TEXAS GENERAL LINES LIFE, ACCIDENT AND HEALTH INSURANCE ACTUAL
EXAM
TEXAS GENERAL LINES LIFE, ACCIDENT AND HEALTH
INSURANCE ACTUAL EXAM COMPLETE 100 QUESTIONS AND
CORRECT DETAILED ANSWERS (VERIFIED ANSWERS)
|ALREADY GRADED A+
The Life insurance policy clause that prevents an insurance company from denying
payment of a death benefit claim after a specified period of time is known as the
A. Incontestability Clause
B. Misstatement of Age clause
C. Reinstatement Clause
D. Insuring Clause
A. Incontestability Clause
Which of the following components must a life insurance policy have to allow
policy loans
A. Cash Value
B. Face Amount
C. Flexible premiums
D. Dividends
A. Cash Value
Which of the following statements about a suicide clause in a life insurance policy
is TRUE?
A. Suicide is excluded as long as the policy is in force
B. Suicide is excluded for a specific period of years and covered thereafter
C. Suicide is covered as long as the policy is in force
D. Suicide is covered for a specific period of years and excluded thereafter.
B. Suicide is excluded for a specific period of years and covered thereafter
1|Page
, TEXAS GENERAL LINES LIFE, ACCIDENT AND HEALTH INSURANCE ACTUAL
EXAM
Which of the following riders is often used in business life insurance policies when
the policyowner needs to change the insured under the policy?
A. Substitute insured rider
B. Payor benefit rider
C. Term rider
D. Guaranteed insurability rider
A . Substitute insured rider
When a whole life policy lapses or is surrendered prior to maturity, the cash value
can be used to
A. Pay back all premiums owed plus interest
B. Purchase a term rider to attach to the policy
C. Receive payments for a fixed amount
D. Purchase a single premium policy for a reduced face amount
D. Purchase a single premium policy for a reduced face amount
All of the following are true of key person insurance EXCEPT
A. The plan is funded by permanent insurance only
B. The employer is the owner, payor, and beneficiary of the policy
C. There is no limitation on the number of key employee plans in force at any time
D. The key employee is the insured
A. The plan is funded by permanent insurance only
Key person coverage may be funded by any type of life insurance
How are contributions to a tax-sheltered annuity treated with regards to taxation?
A. They are taxed as income for the employee, but are tax free upon withdrawal
B. They are taxed as income for the employee
C. They are never taxed
D. They are not included as income for the employee, but are taxable upon
distribution
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, TEXAS GENERAL LINES LIFE, ACCIDENT AND HEALTH INSURANCE ACTUAL
EXAM
D. They are not included as income for the employee, but are taxable upon
distribution
If $100,000 of life insurance proceeds were used in a settlement option, which
paid $13,000 per year for ten years, which of the following would be taxable
annually?
A. $10,000
B. $13,000
C. $7,000
D. $3,000
D. $3,000
If $100,000 of life insurance proceeds were used in a settlement option paying
$13,000 per year for 10 years, $10,000 per year would be income tax free (as
Principal) and $3,000 per year would be income taxable (as interest)
An employee is joining a group insurance plan. In order to avoid having to prove
insurability, what must the employee do?
A. Join during the open enrollment period
B. Sign a statement of continued good health
C. Nothing: Proof of insurability is never required in group policies
D. Provide medical records to the insurer
A. Join during the open enrollment period
All of the following statements concerning an employer sponsored nonqualified
retirement plan are true EXCEPT
A. The employer can receive a current tax deduction for any contributions made
to the plan
B. The plan is a legal method of accumulating more money for retirement needs
C. The plan is not approved for favorable tax treatment by the IRS
D. The plan can discriminate as to who may participate
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EXAM
TEXAS GENERAL LINES LIFE, ACCIDENT AND HEALTH
INSURANCE ACTUAL EXAM COMPLETE 100 QUESTIONS AND
CORRECT DETAILED ANSWERS (VERIFIED ANSWERS)
|ALREADY GRADED A+
The Life insurance policy clause that prevents an insurance company from denying
payment of a death benefit claim after a specified period of time is known as the
A. Incontestability Clause
B. Misstatement of Age clause
C. Reinstatement Clause
D. Insuring Clause
A. Incontestability Clause
Which of the following components must a life insurance policy have to allow
policy loans
A. Cash Value
B. Face Amount
C. Flexible premiums
D. Dividends
A. Cash Value
Which of the following statements about a suicide clause in a life insurance policy
is TRUE?
A. Suicide is excluded as long as the policy is in force
B. Suicide is excluded for a specific period of years and covered thereafter
C. Suicide is covered as long as the policy is in force
D. Suicide is covered for a specific period of years and excluded thereafter.
B. Suicide is excluded for a specific period of years and covered thereafter
1|Page
, TEXAS GENERAL LINES LIFE, ACCIDENT AND HEALTH INSURANCE ACTUAL
EXAM
Which of the following riders is often used in business life insurance policies when
the policyowner needs to change the insured under the policy?
A. Substitute insured rider
B. Payor benefit rider
C. Term rider
D. Guaranteed insurability rider
A . Substitute insured rider
When a whole life policy lapses or is surrendered prior to maturity, the cash value
can be used to
A. Pay back all premiums owed plus interest
B. Purchase a term rider to attach to the policy
C. Receive payments for a fixed amount
D. Purchase a single premium policy for a reduced face amount
D. Purchase a single premium policy for a reduced face amount
All of the following are true of key person insurance EXCEPT
A. The plan is funded by permanent insurance only
B. The employer is the owner, payor, and beneficiary of the policy
C. There is no limitation on the number of key employee plans in force at any time
D. The key employee is the insured
A. The plan is funded by permanent insurance only
Key person coverage may be funded by any type of life insurance
How are contributions to a tax-sheltered annuity treated with regards to taxation?
A. They are taxed as income for the employee, but are tax free upon withdrawal
B. They are taxed as income for the employee
C. They are never taxed
D. They are not included as income for the employee, but are taxable upon
distribution
2|Page
, TEXAS GENERAL LINES LIFE, ACCIDENT AND HEALTH INSURANCE ACTUAL
EXAM
D. They are not included as income for the employee, but are taxable upon
distribution
If $100,000 of life insurance proceeds were used in a settlement option, which
paid $13,000 per year for ten years, which of the following would be taxable
annually?
A. $10,000
B. $13,000
C. $7,000
D. $3,000
D. $3,000
If $100,000 of life insurance proceeds were used in a settlement option paying
$13,000 per year for 10 years, $10,000 per year would be income tax free (as
Principal) and $3,000 per year would be income taxable (as interest)
An employee is joining a group insurance plan. In order to avoid having to prove
insurability, what must the employee do?
A. Join during the open enrollment period
B. Sign a statement of continued good health
C. Nothing: Proof of insurability is never required in group policies
D. Provide medical records to the insurer
A. Join during the open enrollment period
All of the following statements concerning an employer sponsored nonqualified
retirement plan are true EXCEPT
A. The employer can receive a current tax deduction for any contributions made
to the plan
B. The plan is a legal method of accumulating more money for retirement needs
C. The plan is not approved for favorable tax treatment by the IRS
D. The plan can discriminate as to who may participate
3|Page
