ARKANSAS LIFE INSURANCE EXAM QUESTIONS
AND CORRECT ANSWERS NEW MODIFIED
CURRENTLY TESTED AND GRADED A+
Which of the following riders can be used to cover the life of an additional
insured who is an unrelated business partner?
A. Spouse rider
B. Child rider
C. Family rider
D. Nonfamily rider --CORRECT ANSWER--D. Nonfamily rider
In all cases upon the insured's death, the beneficiary receives which of the
following?
A. The policy's rider values
B. A refund of premiums
C. The policy's cash values
D. The face amount of the policy --CORRECT ANSWER--D. The face amount
of the policy
Instead of waiting to receive her payments over time Jeanne decides to obtain
the greatest amount of money out of her annuity immediately. Which option did
she choose?
A. Life income with refund
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,B. Life income period certain
C. Straight life option (life income)
D. Lump Sum --CORRECT ANSWER--D. Lump Sum
An insured owns a $50,000 permanent life policy that she purchased 4 years ago
that has a disability waiver of premium. The insured becomes disabled and pays
premiums during the waiting period until the waiver begins. Once the waiver
begins, what happens to the premiums she paid during the waiting period?
A. It is added to the policy's cash values
B. It is held in escrow until the disability is over then refunded
C. It is kept by the insurer as part of the cost of providing the benefit
D. The insurer refunds it --CORRECT ANSWER--D. The insurer refunds it
How is a life settlement transaction similar to a viatical settlement transaction?
A. The policy is overfunded
B. The policy is about to lapse
C. The insured is terminally ill
D. A third party buys a life insurance policy for less than its face amount --
CORRECT ANSWER--D. A third party buys a life insurance policy for less
than its face amount
Cash values within an ordinary straight whole life insurance policy _______
over time.
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,A. Increases
B. Remain constant
C. Decrease
D. Vary --CORRECT ANSWER--A. Increases
A life insurance premium is paid each month. The insurer then subtracts a
mortality and expense charge from the policy's cash value. This best describes
which of the following life insurance policies?
A. Whole Life
B. Variable Whole Life
C. Universal Life
D. Adjustable Whole Life --CORRECT ANSWER--C. Universal Life
What is the name of a single policy covering two or more lives that pays
benefits upon the death of the first insured?
A. Accidental Death
B. Joint Survivorship Life
C. Joint Life
D. Universal Life --CORRECT ANSWER--C. Joint Life
Which of the following is TRUE of a term rider when attached to a permanent
life policy?
A. It allows the policy to achieve paid up status at the end of the term.
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, B. It can provide additional temporary coverage on the insured or on other
members of the family.
C. It always is in the amount of the base policy
D. It only pays out a death benefit in cases of accidental death --CORRECT
ANSWER--B. It can provide additional temporary coverage on the insured or
on other members of the family
For those individuals who have health issues, which of the following would be
an insurance plan to consider?
A. Decreasing Term
B. Joint Life
C. Group
D. Variable Universal Life --CORRECT ANSWER--C. Group
T has some hearth health issues but needs some additional life insurance
coverage. What options should T consider?
A. A group life insurance plan
B. A group health insurance plan
C. Universal Life Option B
D. Adjustable Life --CORRECT ANSWER--A. A group life insurance plan
If Alvin purchases a Variable Universal Life Policy with a face amount of
$250,000, and chooses death benefit Option B, upon his death the amount of the
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AND CORRECT ANSWERS NEW MODIFIED
CURRENTLY TESTED AND GRADED A+
Which of the following riders can be used to cover the life of an additional
insured who is an unrelated business partner?
A. Spouse rider
B. Child rider
C. Family rider
D. Nonfamily rider --CORRECT ANSWER--D. Nonfamily rider
In all cases upon the insured's death, the beneficiary receives which of the
following?
A. The policy's rider values
B. A refund of premiums
C. The policy's cash values
D. The face amount of the policy --CORRECT ANSWER--D. The face amount
of the policy
Instead of waiting to receive her payments over time Jeanne decides to obtain
the greatest amount of money out of her annuity immediately. Which option did
she choose?
A. Life income with refund
Page 1 of 77
,B. Life income period certain
C. Straight life option (life income)
D. Lump Sum --CORRECT ANSWER--D. Lump Sum
An insured owns a $50,000 permanent life policy that she purchased 4 years ago
that has a disability waiver of premium. The insured becomes disabled and pays
premiums during the waiting period until the waiver begins. Once the waiver
begins, what happens to the premiums she paid during the waiting period?
A. It is added to the policy's cash values
B. It is held in escrow until the disability is over then refunded
C. It is kept by the insurer as part of the cost of providing the benefit
D. The insurer refunds it --CORRECT ANSWER--D. The insurer refunds it
How is a life settlement transaction similar to a viatical settlement transaction?
A. The policy is overfunded
B. The policy is about to lapse
C. The insured is terminally ill
D. A third party buys a life insurance policy for less than its face amount --
CORRECT ANSWER--D. A third party buys a life insurance policy for less
than its face amount
Cash values within an ordinary straight whole life insurance policy _______
over time.
Page 2 of 77
,A. Increases
B. Remain constant
C. Decrease
D. Vary --CORRECT ANSWER--A. Increases
A life insurance premium is paid each month. The insurer then subtracts a
mortality and expense charge from the policy's cash value. This best describes
which of the following life insurance policies?
A. Whole Life
B. Variable Whole Life
C. Universal Life
D. Adjustable Whole Life --CORRECT ANSWER--C. Universal Life
What is the name of a single policy covering two or more lives that pays
benefits upon the death of the first insured?
A. Accidental Death
B. Joint Survivorship Life
C. Joint Life
D. Universal Life --CORRECT ANSWER--C. Joint Life
Which of the following is TRUE of a term rider when attached to a permanent
life policy?
A. It allows the policy to achieve paid up status at the end of the term.
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, B. It can provide additional temporary coverage on the insured or on other
members of the family.
C. It always is in the amount of the base policy
D. It only pays out a death benefit in cases of accidental death --CORRECT
ANSWER--B. It can provide additional temporary coverage on the insured or
on other members of the family
For those individuals who have health issues, which of the following would be
an insurance plan to consider?
A. Decreasing Term
B. Joint Life
C. Group
D. Variable Universal Life --CORRECT ANSWER--C. Group
T has some hearth health issues but needs some additional life insurance
coverage. What options should T consider?
A. A group life insurance plan
B. A group health insurance plan
C. Universal Life Option B
D. Adjustable Life --CORRECT ANSWER--A. A group life insurance plan
If Alvin purchases a Variable Universal Life Policy with a face amount of
$250,000, and chooses death benefit Option B, upon his death the amount of the
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