Texas General Lines - Life, accident and health insurance PRACTICE EXA
Study online at https://quizlet.com/_2sekxk
1. LIFE SECTION 1: LIFE SECTION 1
2. 1) Sandra Timms, age 27, is advised by her producer to purchase Life insur-
ance to cover a 20-year-amortized $50,000 business-improvement loan. Which
of the following plans would adequately protect Ms. Timms at the minimum
premium outlay?: A- $50,000 Whole Life policy
B- $50,000 Level Term policy for 20 years
C- $50,000 20 Pay Life policy
D- $50,000 Decreasing Term policy for 20 years
3. 2) A 45-year old customer who is seeking to supplement his retirement
income at age 65 would not buy a:: A- Deferred Annuity
B- Equity Indexed Annuity
C- Variable Annuity
D- Immediate Annuity
4. 3) John Livingston owns a 30-Pay Life policy that he purchased at the age
of 30. The cash value will equal the face amount of the policy when he reaches
the age of:: A- 60
B- 70
C- 100
D- 30
5. 4) Which of the following is an example of a Limited-Pay Life policy?: A-
Universal life
B- Whole Life
C- Life Paid-Up at Age 65
D- Renewable Term to Age 70
6. 5) Which of the following policies provides the greatest amount of protection
for an insured's premium dollar as well as some cash accumulation?: A-
Annuity
B- Whole Life
C- Term
D- Limited-Pay Life
7. 6) Which of the following individual policy conversions is usually permitted
without any evidence of insurability?: A- Conversion to a lower-premium plan
B- Conversion from a Whole Life policy to a Term policy
C- Conversion from a Term policy to a Whole Life policy
D- Conversion to a larger amount of insurance
8. 7) Which of the following is NOT correct regarding Ordinary Whole Life
policies?: A- The premiums payments are owed annually until you die or reach age
100
B- The cash value grows more quickly in the beginning years of the policy
, Texas General Lines - Life, accident and health insurance PRACTICE EXA
Study online at https://quizlet.com/_2sekxk
C- Coverage lasts for your own life
D- Ordinary Whole Life is a type of permanent insurance
9. 8) Which of the following statements is true about the premium payment
schedule for a Whole Life policy?: A- Premiums are payable for a designated
period of time only, after which coverage is no longer provided
B- Premiums are payable until the insured's retirement only, after which coverage is
continued automatically until the insured's death
C- One premium, in the amount of the insured's choice, is payable at the time of
application, and the balance of the premiums is deducted from the face amount of
the policy at the time of the insured's death
D- Premiums are payable throughout the insured's lifetime, and coverage continues
until the insured's death
10. 9) A life insurance policy that covers two parties, but only pays when the
last party dies is known as:: A- Joint Life
B- Contingent Life
C- Other insured Life
D- Survivorship Life
11. 10) Which of the following contracts requires that a series of benefit
payments be made at specified intervals?: A- 20-Pay Life
B- Modified Whole Life
C- Annuity
D- Ordinary Whole Life
12. 11) If a client wants cash value life insurance with a flexible premium and
an adjustable death benefit that will allow the policy owner a choice of various
cash value investment options, he should buy:: A- Variable Life
B- Universal Life
C- Adjustable Life
D- Variable/Universal Life
13. 12) If a person wants to invest a lump sum in an annuity that may appreciate
along with market and economic conditions, they should buy a:: A- Flexible
premium Annuity
B- Fixed Annuity
C- Deferred Annuity
D- Variable Annuity
14. 13) You have a client that is a real estate agent. Which of the following types
of permanent protection is best for this type of client?: A- Variable life
, Texas General Lines - Life, accident and health insurance PRACTICE EXA
Study online at https://quizlet.com/_2sekxk
B- Universal life
C- Survivorship life
D- Adjustable life
15. 14) In order to sell variable life insurance you must be registered with which
of the following?: A- The SEC
B- The State
C- The NYSE
D- The NASD
16. 15) Which of the following is an example of a Limited-Pay Life policy:: A-
Traditional Whole Life
B- Endowment at 65
C- 10 year Renewable Term Life
D- 20-Pay Life
17. 16) An insurance producer selling a Variable Annuity whose cash value
depends on the performance of an underlying investment account must be
registered with:: A- The National Association of Insurance Commissioners
B- The National Association of Life Underwriters
C- The Chartered Life Underwriters
D- The Financial Industry Regulatory Authority (FINRA, formerly the NASD)
18. 17) A business owner with a fluctuating income who wants a life insurance
policy that can be changed to suit economic conditions should buy:: A- Vari-
able Life
B- Modified Whole Life
C- Adjustable Life
D- Interest-sensitive Whole Life
19. 18) An Annuity is designed to provide which of the following financial
features?
I. The liquidation of principal and interest
II. Favorable tax treatment
III. The creation of an estate: A- I, II, and III
B- I and II
C- I and III
D- II and III
20. 19) Which of the following statements about a Renewable Term policy is
true?: A- It is renewable at the option of the insurance company
B- It is renewable at the option of the insured
C- It is renewable at the option of the insurance company, with proof of insurability
D- It is renewable at the option of the insured, with proof of insurability
, Texas General Lines - Life, accident and health insurance PRACTICE EXA
Study online at https://quizlet.com/_2sekxk
21. 20) Most Term Life insurance:: A- Is convertible to permanent Whole Life
without a physical exam
B- Has a guaranteed cash value
C- Is renewable with evidence of insurability
D- Is renewable to age 100
22. 21) A life insurance policy whose cash value will fluctuate depending upon
the performance of a separate account is:: A- Limited-pay Life
B- Universal Life
C- Ordinary Life
D- Variable Life
23. 22) A life insurance policy that combines term insurance protection, a
flexible premium, and cash value accumulation is:: A- Increasing Term Life
B- Variable/Universal Life
C- Universal Life
D- Variable Life
24. 23) Which of the following types of insurance policies would provide the
greatest amount of protection for a temporary period during which an insured
will have limited financial resources?: A- Term
B- Limited Pay policy
C- Whole Life
D- Annuity
25. 24) At age 30, Tom Morris wishes to purchase a Whole Life policy. His
producer explains that he can pay for the policy in several ways. One method
is called 20-Pay Life, and another, Straight Life. Tom wishes to know which plan
will accumulate cash value at a faster rate in the early years of the policy. Which
of the following would be the producer's most appropriate response?: A-
"20-Pay Life will accumulate cash value faster."
B- "The rate of cash-value accumulation depends on the profitability of the insurance
company."
C- "Straight Life will accumulate cash value faster."
D- "Both plans will accumulate cash value at the same rate."
26. LIFE SECTION 2: LIFE SECTION 2
27. 1) Which of the following statements about the Reinstatement provision is
true?: A- It provides for reinstatement of a policy regardless of the insured's health
B- It requires the policy owner to pay, with interest, all premiums that are in arrears
in order for the policy to be reinstated
C- It permits reinstatement within 10 years after a policy has lapsed
Study online at https://quizlet.com/_2sekxk
1. LIFE SECTION 1: LIFE SECTION 1
2. 1) Sandra Timms, age 27, is advised by her producer to purchase Life insur-
ance to cover a 20-year-amortized $50,000 business-improvement loan. Which
of the following plans would adequately protect Ms. Timms at the minimum
premium outlay?: A- $50,000 Whole Life policy
B- $50,000 Level Term policy for 20 years
C- $50,000 20 Pay Life policy
D- $50,000 Decreasing Term policy for 20 years
3. 2) A 45-year old customer who is seeking to supplement his retirement
income at age 65 would not buy a:: A- Deferred Annuity
B- Equity Indexed Annuity
C- Variable Annuity
D- Immediate Annuity
4. 3) John Livingston owns a 30-Pay Life policy that he purchased at the age
of 30. The cash value will equal the face amount of the policy when he reaches
the age of:: A- 60
B- 70
C- 100
D- 30
5. 4) Which of the following is an example of a Limited-Pay Life policy?: A-
Universal life
B- Whole Life
C- Life Paid-Up at Age 65
D- Renewable Term to Age 70
6. 5) Which of the following policies provides the greatest amount of protection
for an insured's premium dollar as well as some cash accumulation?: A-
Annuity
B- Whole Life
C- Term
D- Limited-Pay Life
7. 6) Which of the following individual policy conversions is usually permitted
without any evidence of insurability?: A- Conversion to a lower-premium plan
B- Conversion from a Whole Life policy to a Term policy
C- Conversion from a Term policy to a Whole Life policy
D- Conversion to a larger amount of insurance
8. 7) Which of the following is NOT correct regarding Ordinary Whole Life
policies?: A- The premiums payments are owed annually until you die or reach age
100
B- The cash value grows more quickly in the beginning years of the policy
, Texas General Lines - Life, accident and health insurance PRACTICE EXA
Study online at https://quizlet.com/_2sekxk
C- Coverage lasts for your own life
D- Ordinary Whole Life is a type of permanent insurance
9. 8) Which of the following statements is true about the premium payment
schedule for a Whole Life policy?: A- Premiums are payable for a designated
period of time only, after which coverage is no longer provided
B- Premiums are payable until the insured's retirement only, after which coverage is
continued automatically until the insured's death
C- One premium, in the amount of the insured's choice, is payable at the time of
application, and the balance of the premiums is deducted from the face amount of
the policy at the time of the insured's death
D- Premiums are payable throughout the insured's lifetime, and coverage continues
until the insured's death
10. 9) A life insurance policy that covers two parties, but only pays when the
last party dies is known as:: A- Joint Life
B- Contingent Life
C- Other insured Life
D- Survivorship Life
11. 10) Which of the following contracts requires that a series of benefit
payments be made at specified intervals?: A- 20-Pay Life
B- Modified Whole Life
C- Annuity
D- Ordinary Whole Life
12. 11) If a client wants cash value life insurance with a flexible premium and
an adjustable death benefit that will allow the policy owner a choice of various
cash value investment options, he should buy:: A- Variable Life
B- Universal Life
C- Adjustable Life
D- Variable/Universal Life
13. 12) If a person wants to invest a lump sum in an annuity that may appreciate
along with market and economic conditions, they should buy a:: A- Flexible
premium Annuity
B- Fixed Annuity
C- Deferred Annuity
D- Variable Annuity
14. 13) You have a client that is a real estate agent. Which of the following types
of permanent protection is best for this type of client?: A- Variable life
, Texas General Lines - Life, accident and health insurance PRACTICE EXA
Study online at https://quizlet.com/_2sekxk
B- Universal life
C- Survivorship life
D- Adjustable life
15. 14) In order to sell variable life insurance you must be registered with which
of the following?: A- The SEC
B- The State
C- The NYSE
D- The NASD
16. 15) Which of the following is an example of a Limited-Pay Life policy:: A-
Traditional Whole Life
B- Endowment at 65
C- 10 year Renewable Term Life
D- 20-Pay Life
17. 16) An insurance producer selling a Variable Annuity whose cash value
depends on the performance of an underlying investment account must be
registered with:: A- The National Association of Insurance Commissioners
B- The National Association of Life Underwriters
C- The Chartered Life Underwriters
D- The Financial Industry Regulatory Authority (FINRA, formerly the NASD)
18. 17) A business owner with a fluctuating income who wants a life insurance
policy that can be changed to suit economic conditions should buy:: A- Vari-
able Life
B- Modified Whole Life
C- Adjustable Life
D- Interest-sensitive Whole Life
19. 18) An Annuity is designed to provide which of the following financial
features?
I. The liquidation of principal and interest
II. Favorable tax treatment
III. The creation of an estate: A- I, II, and III
B- I and II
C- I and III
D- II and III
20. 19) Which of the following statements about a Renewable Term policy is
true?: A- It is renewable at the option of the insurance company
B- It is renewable at the option of the insured
C- It is renewable at the option of the insurance company, with proof of insurability
D- It is renewable at the option of the insured, with proof of insurability
, Texas General Lines - Life, accident and health insurance PRACTICE EXA
Study online at https://quizlet.com/_2sekxk
21. 20) Most Term Life insurance:: A- Is convertible to permanent Whole Life
without a physical exam
B- Has a guaranteed cash value
C- Is renewable with evidence of insurability
D- Is renewable to age 100
22. 21) A life insurance policy whose cash value will fluctuate depending upon
the performance of a separate account is:: A- Limited-pay Life
B- Universal Life
C- Ordinary Life
D- Variable Life
23. 22) A life insurance policy that combines term insurance protection, a
flexible premium, and cash value accumulation is:: A- Increasing Term Life
B- Variable/Universal Life
C- Universal Life
D- Variable Life
24. 23) Which of the following types of insurance policies would provide the
greatest amount of protection for a temporary period during which an insured
will have limited financial resources?: A- Term
B- Limited Pay policy
C- Whole Life
D- Annuity
25. 24) At age 30, Tom Morris wishes to purchase a Whole Life policy. His
producer explains that he can pay for the policy in several ways. One method
is called 20-Pay Life, and another, Straight Life. Tom wishes to know which plan
will accumulate cash value at a faster rate in the early years of the policy. Which
of the following would be the producer's most appropriate response?: A-
"20-Pay Life will accumulate cash value faster."
B- "The rate of cash-value accumulation depends on the profitability of the insurance
company."
C- "Straight Life will accumulate cash value faster."
D- "Both plans will accumulate cash value at the same rate."
26. LIFE SECTION 2: LIFE SECTION 2
27. 1) Which of the following statements about the Reinstatement provision is
true?: A- It provides for reinstatement of a policy regardless of the insured's health
B- It requires the policy owner to pay, with interest, all premiums that are in arrears
in order for the policy to be reinstated
C- It permits reinstatement within 10 years after a policy has lapsed
