1 \/ 9
Alabama Life and Health Insurance Final Exam
2023 – 2024 (Verified Answers)
1.replacement regulation does not apply to ANS credit life insurance
2.a policy owner can collect the face amount on what type of policy? ANS
endow- ment policy<\/p>\n\n\n\n
2 \/ 9
a felony, inquires sustained while serving in the military, self-inflicted
injuries
7.in regards to a life insurance policy or an annuity contract, all
statements made on the application are considered to be ANS
representations
8.an accidental death rider claim is usually paid if the insured ANS dies
within 90 days of the accident
9.an insurance premium can be defined as ANS money paid to an
insurance com- pany for benefits provided in the policy
10.what is a disability income policy designed to do? ANS pay benefits to
maintain the insured’s current standard of living
11.an insurance producer must have which of the following in order to sell
variable life insurance policies? ANS all of these ANS registered with
FINRA, license for variable life and annuities contracts, a valid
insurance license
12.what is a certificate of insurance? ANS a certificate is issued to each
individual covered by the group life insurance<\/p>\n\n\n\n
3 \/ 9
13.which of the following statements about a noncancellable policy
is FALSE? ANS the premium rate CAN be increased over time
14.what does the insurance company represent? ANS the insurance
company
15.an insurer pays a large claim for medical expenses after the insured has
only made one premium payment. this is an example of a(n) ANS aleatory
contract
16.an insured owns a policy which includes a disability income rider. the
disability benefit amount paid to the insured is based on the ANS face
amount of the policy
17.how are employer-paid premiums for employee group health insurance
normally treated for tax purposes? ANS tax deductible to the
employer\/nontaxable to the employee
18.which of the following events would allow a policyowner with aguaranteed insurability rider purchase additional life insurance? ANS all ofthese ANS having a child, getting married, reaching a specified agestated in the policy
<\/p>\n\n\n\n
1 \/ 7
Alabama Life and Health Insurance Final Exam
Practice Questions 2023 – 2024 (Verified Answers)
1.The minimum grace period for a life insurance policy sold in Alabama is
ANS 30 days
2.Alabama’s annuity disclosure regulation ANS Requires the delivery of a
buyer’s guide and a disclosure document to annuity applicant
3.An insurer pays a large claim for medical expenses after the insured has
only made one premium payment. This is an example of an ANS Aleatory
contract
4.Which of the following is NOT guaranteed by a whole life policy? ANS
policy dividends
5.Any individual who has failed two Alabama insurance licensing
examina- tions must wait how long before retaking it a third time? ANS 3
months<\/p>\n\n\n\n
2 \/ 7
6.When an estate is named beneficiary to a life insurance policy, the
policy proceeds are ANS distributed according to state law
7.Which of the following statements concerning a life insurance policy
is TRUE? ANS an issued policy can never be changed by a producer
8.Julio, the insurance producer, has allowed his license to lapse. He would
like to reinstate his licenses without retaking a pre license course or
passing a written examination. To do this, Julio must reinstate the license
within
months from the renewal date. ANS 12 months
9.Janet is retired and looking to invest a lump-sum of money through an
insurance company. Which product would be best suited for this? ANS
annuity
10.Tina has an insurance policy with a 10-day free look provision. Which of
these statements is correct? ANS Her policy can be returned for 100%
refund of the premium within 10 days from the date the policy is
delivered
11.A collateral assignment allows a policy owner to assign ANS A portion
of the policy proceeds to the assignee
12.A licensed Alabama insurance producer would NOT be disciplined by<\/p>\n\n\n\n
3 \/ 7
the Commissioner of Insurance for ANS Being convicted of a
misdemeanor
13.What is a defined benefit plan? ANS a retirement plan that promises
a specified benefit to the employee at retirement
14.Which of these is NOT considered a form of advertisement in Alabama?
ANS A producer sending a Christmas card to a client
15.Buying land with the anticipation of it going up in value is an
example of ANS Speculative risk
16.If an individual would like to sell insurance for an insurance company
, he\/she must
A. Have passed the state exam for the lines of authority in which licensure
is sought
B. Be licensed as an insurance producer
<\/p>\n\n\n\n
1 \/ 10
Alabama Life and Health Insurance Final Exam
2023 – 2024 (Verified Answers)
1.John has recently died and it was discovered that he was actually ten
years older than what was listed on his life insurance policy. What will the
insurer pay his beneficiary? ANS The amount of insurance that his
premiums would have purchased at his correct age
2.Which of the following is considered the “automatic” Nonforfeiture
Option that most insurers will use? ANS Extended term<\/p>\n\n\n\n
2 \/ 10
5.The monthly benefit of an Annuity Certain is determined by ANS The
annuitant’s payout period selection<\/p>\n\n\n\n
3 \/ 10
11.Alabama’s continuing education law states that an insurance
producer must report how many classroom hours every two years? ANS
24
12.Mortgage protection is typically covered with ANS Decreasing term
13.A departing employee has decided to continue his group coverage
through COBRA. Who pays the premium in this situation? ANS Employee
14.Kim has purchased a straight life annuity. What will this type of
annuity provide her with? ANS A periodic income to the annuitant for
life
15.According to Required Provision 4, when an insured applies forreinstate- ment of a health policy and receives a conditional receipt, howlong does the insurer have to approve or deny? ANS Within 45 days of thedate of application
16.An example of a life insurance beneficiary is a(n) ANS Child, spouse, orcompa- ny of the insured.<\/p>\n\n\n\n
1 \/ 23
Alabama Life and Health Insurance Final Exam
2023 – 2024 (Verified Answers)
1.Under a health maintenance organization HMO service providers are paid
a fixed monthly fee for each member. This concept is called ANS Capitation
2.When can a lapsed life insurance policy usually be reinstated ANS Within
three to five years of the policy lapsing
3.All of these statements concerning the coordination of benefits are trueex- cept ANS The secondary insurance does not pay benefits. Whichmeans the secondary insurer does pay benefits
4.The period of time during which a surviving spouse does not qualify for
Social Security survivor or retirement benefits is called ANS The blackout
period
5.Peggy surrenders a permanent life policy with a cash value of $15,000
and then outstanding policy loan of $5,000. If she chooses the reduced
paid-up option what will be the result? ANS A paid up permanent policy
purchased with<\/p>\n\n\n\n
2 \/ 23
$10,000
6.Total disability can be defined as the insureds inability to perform the
occupation for which he or she is reasonably qualified by education
training or experience for disability income insurance purposes this
definition is what ANS Own occupation
7.Why are insurance contracts said to be contracts of adhesion ANS Thecontract has been prepared by one party the insurer and the otherparty which is the insured must accept the contract as written<\/p>\n\n\n\n
3 \/ 23
permanent insurance ANS Convertible term
12.Trent has a permanent partial disability where he is paid 50% of
his previous income. Trent is covered by a ANS Residual disability
benefit
13.Which of these actions could result in a lapsed policy ANS Premium
was not paid during the grace period
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