INDIANA LIFE INSURANCE EXAM QUESTIONS
WITH VERIFIED SOLUTIONS NEW MODIFIED
CURRENTLY TESTED AND VERIFIED 2026 NEW
UPGRADE
A type of Annuity in which the cash values are invested in securities is called:
a. Variable
b. Deferred
c. Joint and Survivorship
d. Flexible premium --CORRECT ANSWER--Variable
Mary is receiving an annuity payout from her Variable Straight Life Annuity. Upon her
death, which of the following will be payable to her estate?
a. Nothing
b. The policy death benefit
c. The remaining value of her account
d. The total premiums paid into the account, less the amount paid to Mary in benefits --
CORRECT ANSWER--A. Nothing
What is decreasing in a Decreasing Term policy?
a. The cash value
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,b. The premium
c. The face amount
d. The nonforfeiture values --CORRECT ANSWER--The Face Amount
Endowment policies can mature in two ways. What are they?
a. The insured dies during the policy period or annuitizes the policy after age 59&1/2.
b. The insured dies during the policy period or reaches the endowment age as designated in
the policy.
c. The insured dies during the policy period or retires at age 59&1/2.
d. The insured dies or reaches age 100. --CORRECT ANSWER--B. The insured dies during
the policy period or reaches the endowment age as designated in the policy.
At age 30, Joe Insured purchases a 20 Pay Whole Life Policy. Which of the following
statements is true regarding Joe's policy coverage?
a. Joe's death protection will end at age 50.
b. Joe's nonforfeiture values will end at age 50.
c. Joe will be able to stop paying the premiums at age 50, but his death protection will run
through age 100.
d. At age 50, Joe's cash value will equal the face value of his contract. --CORRECT
ANSWER--C. Joe will be able to stop paying the premiums at age 50, but his death
protection will run through age 100.
Warranties are:
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,a. The same as representations.
b. Statements that are absolutely true.
c. Statements that are believed to be true.
d. Critical to the formation of a life insurance contractual agreement. --CORRECT
ANSWER--B. Statements that are absolutely true.
Which of the following is NOT a characteristic of a Variable Annuity?
A. Premium Payments may be level or flexible or single premium
B. The cash values are invested in securities.
C. The non-forfeiture values will provide for the return of the cash value should the annuitant
die during the accumulation period.
D. It provides for a tax-free death benefit. --CORRECT ANSWER--D. It provides for a tax-
free death benefit.
All of the following policies provide for the tax deferred accumulation of cash value
EXCEPT:
A. Interest Sensitive Whole Life
B. Single Premium Variable Annuity
C. Variable Universal Life
D. Term Life --CORRECT ANSWER--D. Term Life
All of the following are true statements about the taxation of life insurance benefits except:
A. Policy loans are taxed as ordinary income
B. The cash value in a life insurance policy grows on a tax deferred basis.
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, C. The interest earned on the "interest" Settlement Option is taxed as ordinary income.
D. The death benefit of a life policy is received by the beneficiary federal income tax free. --
CORRECT ANSWER--A. Policy loans are taxed as ordinary income
Which of the following statements is true about the Group Life conversion privilege?
a. Death during the conversion period is covered even if the departing employee chooses
NOT to convert to an individual policy.
b. The departing employee must pay the premium if they elect to be covered during the
conversion period.
c. If a departing employee elects to convert their life insurance, the company must offer Term
insurance as a choice.
d. Under the COBRA laws a departing employee may elect to remain a member of the Group
Life plan for a limited period of time. --CORRECT ANSWER--A. Death during the
conversion period is covered even if the departing employee chooses NOT to convert to an
individual policy.
Which of the following is a combination of Decreasing Term and Whole Life?
a. Family Income Policy
b. Family Maintenance Policy
c. Modified Life
d. Family Policy --CORRECT ANSWER--A. Family Income Policy
All the following are reasons why an insurance company may not pay a death benefit under a
Term life insurance policy EXCEPT:
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WITH VERIFIED SOLUTIONS NEW MODIFIED
CURRENTLY TESTED AND VERIFIED 2026 NEW
UPGRADE
A type of Annuity in which the cash values are invested in securities is called:
a. Variable
b. Deferred
c. Joint and Survivorship
d. Flexible premium --CORRECT ANSWER--Variable
Mary is receiving an annuity payout from her Variable Straight Life Annuity. Upon her
death, which of the following will be payable to her estate?
a. Nothing
b. The policy death benefit
c. The remaining value of her account
d. The total premiums paid into the account, less the amount paid to Mary in benefits --
CORRECT ANSWER--A. Nothing
What is decreasing in a Decreasing Term policy?
a. The cash value
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,b. The premium
c. The face amount
d. The nonforfeiture values --CORRECT ANSWER--The Face Amount
Endowment policies can mature in two ways. What are they?
a. The insured dies during the policy period or annuitizes the policy after age 59&1/2.
b. The insured dies during the policy period or reaches the endowment age as designated in
the policy.
c. The insured dies during the policy period or retires at age 59&1/2.
d. The insured dies or reaches age 100. --CORRECT ANSWER--B. The insured dies during
the policy period or reaches the endowment age as designated in the policy.
At age 30, Joe Insured purchases a 20 Pay Whole Life Policy. Which of the following
statements is true regarding Joe's policy coverage?
a. Joe's death protection will end at age 50.
b. Joe's nonforfeiture values will end at age 50.
c. Joe will be able to stop paying the premiums at age 50, but his death protection will run
through age 100.
d. At age 50, Joe's cash value will equal the face value of his contract. --CORRECT
ANSWER--C. Joe will be able to stop paying the premiums at age 50, but his death
protection will run through age 100.
Warranties are:
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,a. The same as representations.
b. Statements that are absolutely true.
c. Statements that are believed to be true.
d. Critical to the formation of a life insurance contractual agreement. --CORRECT
ANSWER--B. Statements that are absolutely true.
Which of the following is NOT a characteristic of a Variable Annuity?
A. Premium Payments may be level or flexible or single premium
B. The cash values are invested in securities.
C. The non-forfeiture values will provide for the return of the cash value should the annuitant
die during the accumulation period.
D. It provides for a tax-free death benefit. --CORRECT ANSWER--D. It provides for a tax-
free death benefit.
All of the following policies provide for the tax deferred accumulation of cash value
EXCEPT:
A. Interest Sensitive Whole Life
B. Single Premium Variable Annuity
C. Variable Universal Life
D. Term Life --CORRECT ANSWER--D. Term Life
All of the following are true statements about the taxation of life insurance benefits except:
A. Policy loans are taxed as ordinary income
B. The cash value in a life insurance policy grows on a tax deferred basis.
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, C. The interest earned on the "interest" Settlement Option is taxed as ordinary income.
D. The death benefit of a life policy is received by the beneficiary federal income tax free. --
CORRECT ANSWER--A. Policy loans are taxed as ordinary income
Which of the following statements is true about the Group Life conversion privilege?
a. Death during the conversion period is covered even if the departing employee chooses
NOT to convert to an individual policy.
b. The departing employee must pay the premium if they elect to be covered during the
conversion period.
c. If a departing employee elects to convert their life insurance, the company must offer Term
insurance as a choice.
d. Under the COBRA laws a departing employee may elect to remain a member of the Group
Life plan for a limited period of time. --CORRECT ANSWER--A. Death during the
conversion period is covered even if the departing employee chooses NOT to convert to an
individual policy.
Which of the following is a combination of Decreasing Term and Whole Life?
a. Family Income Policy
b. Family Maintenance Policy
c. Modified Life
d. Family Policy --CORRECT ANSWER--A. Family Income Policy
All the following are reasons why an insurance company may not pay a death benefit under a
Term life insurance policy EXCEPT:
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