California Life And Health Insurance Exam Questions Quiz

26 Questions | Total Attempts: 20773

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California Life And Health Insurance Exam Questions Quiz - Quiz

This California life and health insurance exam quiz is useful for those individuals who are looking towards producing or selling life and/or health insurance in the state of California. Since you need a license to do so which comes with the California Life and Health Insurance Agent exam, therefore you need a lot of practice for making it through the exam itself. Here we have got a beneficial practice test for you. Take the test and prepare yourself for the exam. All the best!


Questions and Answers
  • 1. 
    Which of the following characteristics would not stop an insurance company from accepting an insurance risk? The item to be insured:
    • A. 

      Faces high catastrophic loss exposure

    • B. 

      Is part of a large group of homogeneous exposure units

    • C. 

      Has a market value difficult to determine

    • D. 

      Holds no hardship to the owner should it be lost or damaged

  • 2. 
    All of the following statements about mutual insurance companies are correct, except:
    • A. 

      If a mutual company goes public, it demutualizes

    • B. 

      Mutual companies issue policies referred to as participating

    • C. 

      Policy dividends issued by mutual companies are guaranteed and not taxable

    • D. 

      Dividends allow policyholders to share in a mutual companies divisible surplus

  • 3. 
    Which is a false statement? The California Insurance Commissioner is:
    • A. 

      Elected by the people of California every four years

    • B. 

      Selected by the Governor as an appointee

    • C. 

      Is a representative to the National Association of Insurance Commissioners (NAIC)

    • D. 

      Capable of becoming the conservator of a financially impaired, or insolvent, insurer

  • 4. 
    Which statement about life insurance code and ethics is not true?
    • A. 

      Marketing plans to offer free insurance as an inducement to buy or rent real property are prohibited

    • B. 

      Acts of fair and unfair discrimination are prohibited

    • C. 

      Agents are not permitted to advertise that an insurer is a member of any insurance guaranty association

    • D. 

      The act of twisting could result in a license suspension for up to three years

  • 5. 
    Which of the following statements about a resident life-only agent licensing is incorrect?
    • A. 

      A licensee has 30 days to update a change in address

    • B. 

      Licensees are required to have an in-state residential address

    • C. 

      Loss of a precious professional license could result in the automatic denial of the life-only license application

    • D. 

      A plea of nolo contendere is considered a conviction, thus it could hinder attempts to obtain a life-only license

  • 6. 
    Tommy Greene has a CLU certification. Which of th following names would automatically approve for use as his agency's name?
    • A. 

      Tommy Greene and Associates

    • B. 

      Thomas Greene, CLU, & Company

    • C. 

      Greene Insurance Agency

    • D. 

      None of the would ever be automatically approved

  • 7. 
    An agent follows the rules and terms of his agent contract. He is excersising his _______ authority.
    • A. 

      Implied

    • B. 

      Express

    • C. 

      Apparent

    • D. 

      Contractual

  • 8. 
    Any person who misappropriates fiuciary funds for personal use is guilty of:
    • A. 

      Fraud

    • B. 

      Theft

    • C. 

      Misreperesentation

    • D. 

      Pre-texting

  • 9. 
    According to the code, any person legally capable of making an insurance policy is considered:
    • A. 

      An agent

    • B. 

      A broker

    • C. 

      An insurer

    • D. 

      An underwriter

  • 10. 
    Mrs. Anderson need to invest the proceeds from her late husband's life insurance. She invests a portion of the money into an annuity. Since she is 62, and is still working, she decides to purchase a single premium deferred annuity. She won' t need an income for a few more years. What should the agent make sure Mrs. Anderson understands?
    • A. 

      As a life insurance product, future proceeds are tax free.

    • B. 

      She has a 30 day free look period in case she changes her mind.

    • C. 

      Since she only has a few more years before she retires, she should invest with the objective tho make as much money as possible. Her time horizon is limited.

    • D. 

      She will have to begin taking withdrawals within six months of receiving the proceeds.

  • 11. 
    In a non-contributory group policy:
    • A. 

      75% of eligible employees must elect to join the plan.

    • B. 

      100% of eligible employees must participate.

    • C. 

      75% of employees must elect to join the plan.

    • D. 

      100% of employees must be allowed to participate.

  • 12. 
    An employee has lost access to their group term life insurance plan, but they are allowed to convert to a new plan. Which best describes this new plan?
    • A. 

      The new policy will be term life. The employee pays all premiums.

    • B. 

      The new policy will be term life. The employer will pay a portion of the cost.

    • C. 

      The new policy will be cash value. The employer will pay a portion of the cost.

    • D. 

      The new policy will be cash value. The employee pays all the premiums.

  • 13. 
    Bob and Neal are partners in a law firm together. If one of them were to pass away, the want to make sure that their surviving family will receive a fair value for their stake in the business. What life insurance arrangement would be most suited for transitioning the business during this time of loss?
    • A. 

      Split Dollar Plan

    • B. 

      Executive Bonus Plan

    • C. 

      Buy-Sell Agreement

    • D. 

      Deferred Compensation Plans

  • 14. 
    Rank from lowest to highest, the amount of monthly income that would result from the following annuity settlement options:
    • A. 

      Life with refund option, life with 10 years certain, straight life

    • B. 

      Straight life, life with ten years certain, life refund option

    • C. 

      Life with ten year certain, life with refund option, straight life

    • D. 

      Life with refund option, straight life, life with 10 years certain

  • 15. 
    All of the following are dividend options, except:
    • A. 

      Interest only option

    • B. 

      One-year term option

    • C. 

      Reduce the nest premium payment

    • D. 

      Accumulate with interest

  • 16. 
    Which best describes industrial insurance?
    • A. 

      $2,000 or less in coverage and premiums collected by agent.

    • B. 

      $10,000 coverage and premiums paid by mail.

    • C. 

      $50,000 coverage and premiums paid by mail.

    • D. 

      $100,000 coverage and premiums collected by agent.

  • 17. 
    A client's flexible premium is invested into a seperate account. What type of insurance product did he purchase?
    • A. 

      Universal Life

    • B. 

      An Annuity

    • C. 

      Variable Life

    • D. 

      Variable Universal Life

  • 18. 
    Which rider pays a multiple of the original face amount?
    • A. 

      Accelerated Death Benefit

    • B. 

      Accidental Death Benefit

    • C. 

      Accidental Death and Dismemberment

    • D. 

      Cost of Living

  • 19. 
    A life-only agent issues a binding receipt to his client since the client did include a check for the initial premium with his completed application. Which is true?
    • A. 

      The client is covered during underwriting.

    • B. 

      The agent faces potential suspension or revocation of their license.

    • C. 

      The client is not covered during underwriting since binders only start once underwriting is complete.

    • D. 

      Since the medical exam hasn't been completed yet, the client is not covered at all.

  • 20. 
    Which of the following would not be considered a speculative risk?
    • A. 

      Every week your client plays $20 on the lotto.

    • B. 

      Any action that could do harm to your clients well-being such as reckless driving.

    • C. 

      Your client invest 5% of his salary into the defined benefit plan at his work.

    • D. 

      All of the above situations involve some risk.

  • 21. 
    According to the California Insurance Code, what information is the agent required to include on their business card?
    • A. 

      Identification of their relationship to the insurance company.

    • B. 

      License number must appear in the same size font as the phone number.

    • C. 

      Must not include any title, designations, or licenses that are not currently held.

    • D. 

      All of the above.

  • 22. 
    How does the IRS classify the two different types of retirement accounts?
    • A. 

      Qualified and unfunded

    • B. 

      Fully funded and non-qualified

    • C. 

      Qualified and non-qualified

    • D. 

      Contributory and noncontributory

  • 23. 
    An insured has a terminal illness and needs to access 1/3 of his death benefit to pay mounting medical expenses. Which rider would meet the insured's current needs?
    • A. 

      Automatic Premium Loan

    • B. 

      Accelerated (Living) Benefit

    • C. 

      Assignment of Benefit

    • D. 

      Payor Benefit

  • 24. 
    In disability insurance, the period of time between when the disability started and the commencement of benefits is the:
    • A. 

      Cancellation Period

    • B. 

      Elimination Period

    • C. 

      Probationary Period

    • D. 

      Grace Period

  • 25. 
    In a seven year vesting schedule, what percentage of employer contributions is vested after seven years?
    • A. 

      0%

    • B. 

      60%

    • C. 

      80%

    • D. 

      100%

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