CA LIFE INSURANCE PRACTICE EXAM

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CA LIFE INSURANCE PRACTICE EXAM

Actual Qs and Ans - Expert-Verified Explanation -Guaranteed passing score -89 Questions and Answers

-Format: Multiple-choice / Flashcard

Question 1: In the event a terminated or ineligible employee dies during the conversion period from a group life plan, whether they were going to elect individual coverage or not, a death claim will be paid by the group policy, less the premium due for the benefit, which

means that the conversion period is really:

Answer:

Grace period Question 2: The California Insurance Code requires all producers who meet with established clients age 65 and older in their homes for the purpose of transacting life insurance, annuities,

or disability insurance products to provide the required written notice:

Answer:

No later than at the time of an appointment The 24 hours in advance requirement applies to prospective clients, not established clients. Established clients may be given the notice at the time of an appointment.Question 3: Lorraine's position has been terminated, and she is interested in converting her group life coverage to an individual policy. In the process, she will find all of the following to be

TRUE, except:

Answer:

-She will be converting her group term benefit to an individual term benefit She will be converting her group term life to an individual permanent policy.

Question 4: In California, all of the following are true, except:

Answer:

The notice of appointment of an agent by an insurer must be filed with the Commissioner upon licensing the agent or within 30 days of the appointment The notice of the appointment must be filed with the Commissioner upon licensing the applicant or within 14 days of the appointment.It is considered a misdemeanor in this state to assist a nonadmitted insurer to transact business unless acting in the capacity of Surplus Lines Broker Any insurer, agent, broker or solicitor who is found to have willfully violated the rules regarding 'free insurance' may have its certificate or license suspended for a maximum of one year Question 5: In the event a terminated or ineligible employee dies during the conversion period from a group life plan, whether they were going to elect individual coverage or not, a death claim will be paid by the group policy, less the premium due for the benefit, which means that

the conversion period is really:

Answer:

Grace period In the event a terminated or ineligible employee dies during the conversion period from a group life plan, whether they were going to elect individual coverage or not, a death claim will be paid by the group policy, less the premium due for the benefit, which means that the conversion period is really a grace period.

Question 6: Who enforces the regulations found in the CCR?

Answer:

The insurance commissioner The Commissioner enforces the Code by writing and adopting regulations that specify the manner of enforcement or provide details that are not explicitly cited in the Code.Question 7: All of the following regarding credit life are true, except:

Answer:

Usually the creditor pays the premium Usually the individual debtor pays the premium.Question 8: All of the following statements about Group Life Insurance are true, except:

Answer:

Employees receive a tax deduction for employer paid premiums Employer, not employee, paid premiums are tax deductible. Only when the insurance benefit exceeds $50,000 does the employee have to report it as taxable income.

Question 9: Which of the following is a disadvantage of being covered under a group insurance plan?

Answer:

The group sponsor can elect to discontinue the plan, and the insurance company can increase the rates it charges Question 10: Before a regulation proposed by the Insurance Commissioner takes effect, all of

the following must occur, except:

Answer:

The state legislature must enact the regulation after the OAL has approved it The legislature is not involved in the process of creating regulations.Proposed regulations must be published for public comment A public hearing is held to receive comment on the proposed regulation The Office of Administrative Law must review the regulation for conformity with other state laws Question 11: The California Insurance Code requires all producers who meet with prospective clients age 65 and older in their homes for the purpose of transacting life insurance, annuities, or disability insurance products to first provide a written notice of the first meeting which producers must retain a copy of in their files for a minimum of ______ years.

Answer:

5 Question 12: All licensed producers must complete how many hours of CE to renew their license?

Answer:

24 All licensed producers must complete a minimum of 24 hours of continuing education prior to each license renewal.Property Broker-Agent and/or Casualty Broker-Agent, Personal Lines Broker-Agent, Life-Only and/or Accident and Health licensees must complete a total of twenty four (24) hours of continuing education for every two-year license term.Question 13: A Property & Casualty Broker-Agent who is also licensed as a Life-Only agent may not charge a fee to a consumer for which of the following acts?

Answer:

Analyzing a person's universal life insurance policy Only a licensed Life & Disability Insurance Analyst may charge a consumer a fee to analyze a life or disability insurance policy or annuity. There is no prohibition against a Broker-Agent from charging a fee to represent a consumer and also collecting a commission for placing a consumer's business with an insurer, but the Broker-Agent is expected to disclose to the consumer that a commission may be paid to

the Broker-Agent in addition to any fee charged.Question 14: Insurers must respond in writing to an insured's or claimant's notice of loss within how many days?

Answer:

15 Insurers (and other licensees) must respond in writing to an insured's or claimant's notice of loss within 15 days of receiving that notice orally or in writing.Question 15: The continuation of coverage under a particular benefit provided under a group policy following discontinuance with respect to an employee or dependent who is totally

disabled on the date of discontinuance is called:

Answer:

Extension of benefits Extension of Benefits is the continuation of coverage under a particular benefit provided under a group policy following discontinuance with respect to an employee or dependent who is totally disabled on the date of discontinuance.

Question 16: How is the funding for Social Security provided?

Answer:

-Through FICA taxes that are paid by both employers and employees Both the employer and employee fund Social Security through paying FICA taxes. Self-employed persons pay the entire amount.Question 17: Any notice required to be given to an insured by the insurer may be mailed, postage paid, and addressed to the policyowner, insured, claimant, or beneficiary to be notified

at the:

Answer:

Last known address of record Under the California insurance code any notice required to be given to an insured may be mailed, postage paid, and addressed to the policyowner, insured, claimant, or beneficiary to be notified at his/her last known address of record.

Question 18: Which of the following establishes a cost basis in an annuity?

Answer:

After-tax contributions Cost basis is established with any after-tax premiums deposited into the annuity.