Life Health Insurance Exam

Life & Health Insurance Exam | Questions with Verified Answers | 100% Correct (Latest 2025 / 2026)

Question:

which of the following statements about accumulated interest earned on dividends from an insurance policy is TRUE?

Answer:

it is taxed as ordinary income

Question:

dividends paid from a life insurance policy are

Answer:

issued by the insurer

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Question:

Which of the following Dividend options results in taxable income to the policyowner?

Answer:

accumulation at interest

Question:

Which of these Nonforfeiture Options continue a build-up of cash value?

Answer:

reduced paid-up

Question:

what action can a policyowner take if an application for a bank loan requires collateral?

Answer:

assign policy ownership to the bank

Question:

which of the following nonforfeiture options offers the highest death benefit?

Answer:

extended term 2 / 3

Question:

Which of these life insurance riders allows the applicant to have excess coverage?

Answer:

term rider

Question:

The common disaster clause provides that if both the insured and the sole name beneficiary were to die in a common accident, which of the following is true?

Answer:

This clause provides the payment of proceeds to the insured's estate

Question:

A primary beneficiary has died before the insured in a life insurance policy. A contingent beneficiary is also named in the policy. Which of the following will occur when the insured dies?

Answer:

proceeds will go to the contingent beneficiary

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