XCEL INSURANCE LICENSING EXAM ACTUAL
EXAM | QUESTIONS AND CORRECT ANSWERS |
ALREADY GRADED A+ | VERIFIED ANSWERS |
LATEST VERSION
A life insurance policy that pays the face amount if the insured survives to a
specified period of time is called
A) universal life
B) endowment insurance
C) modified life
D) whole life ------CORRECT ANSWER---------------B) endowment
insurance
Lynn owns a life policy that guarantees the right to renew the policy each
year, regardless of health, but at an increased premium. What kind of
policy is this?
A) Universal life
B) Renewable whole
C) Renewable term
D) Endowment ------CORRECT ANSWER---------------C) Renewable term
A renewable term life insurance policy guarantees a policyowner the
right to renew the policy, without evidence of insurability, but at an
increased premium.
John and Mary have a handicapped child that is financially dependent upon
them. The death of one of the parents would not be financially disastrous,
however the death of both likely would be. Which policy would be best
suited for them?
A) Payor protection policy
B) Family income policy
Scott has just purchased a new house. He is now shopping for a life
insurance policy that provides a death benefit that matches the projected
outstanding debt of his mortgage.
Which life policy would best suit his needs?
A) Variable
B) Universal
C) Adjustable
D) Mortgage redemption ------CORRECT ANSWER---------------D) Mortgage
redemption
Mortgage redemption insurance is a decreasing term life policy taken
by a debtor to repay the balance on a mortgage loan if he or she dies
before repayment.
Which of the following types of life insurance combines a savings element
along with a flexible premium option?
A) Joint life
B) Whole life
C) Universal life
D) Universal life ------CORRECT ANSWER---------------C) Universal life
Which of the following statements do NOT apply to child coverage in a
family policy?
A) Child coverage is convertible to permanent insurance
B) Child coverage comes in the form of term insurance
C) Children are covered up to an age stated in the policy
,D) Only children born prior to policy's issue date may be included ------
CORRECT ANSWER---------------D) Only children born prior to policy's
issue date may be included
Children born AFTER the policy's issue date may be
covered in a family policy.
Which of the following is NOT a true description of non-medical life
insurance?
A) Quicker processing of life insurance application
B) Less cost involved with underwriting the application
C) Applicants are not required to answer medical questions on the
application
D) Demand on the medical profession reduced ------CORRECT ANSWER--
-------------C) Applicants are not required to answer medical questions on
the application
Medical questions can still be asked on an application of non-medical
life insurance.
A Renewable Term Life insurance policy can be renewed
A) at a predetermined date or age, regardless of the insured's health
B) only if the insured provides evidence of insurability
C) anytime at the policyowner's request
D) typically with no change in premium ------CORRECT ANSWER-------------
--A) at a predetermined date or age, regardless of the insured's health
In a renewable term life insurance policy, the contract will usually
A) require a higher premium payable at each renewal
B) require a lower premium payable at each renewal
C) keep the same premium level at each renewal
, D) stipulate a higher cash value at each renewal ------CORRECT
ANSWER---------------A) require a higher premium payable at each renewal
Mark, age 45, has a Modified Endowment Contract (MEC).
What is the tax penalty for taking a loan against this policy prior to age 59
1/2?
A) 5%
B) 10%
C) 15%
D) 25% ------CORRECT ANSWER---------------B) 10%
Penalty taxes
(10%) on premature distributions prior to age 59 ½ from a modified
endowment contract (MEC) normally apply to policy loans.
An insurer can be protected from adverse selection with which policy
provision?
A) Insuring clause
B) Grace period
C) Suicide clause
D) Reinstatement ------CORRECT ANSWER---------------C) Suicide clause
If an insured dies because of an accident, which type of life insurance rider
will provide additional coverage?
A) Accidental death rider
B) Payor rider
C) Accelerated rider
D) Extended term rider ------CORRECT ANSWER---------------A) Accidental
death rider
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