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TEXAS GENERAL LINES LIFE, ACCIDENT AND HEALTH INSURANCE 2 LATEST VERSIONS ACTUAL EXAM
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TEXAS GENERAL LINES LIFE, ACCIDENT AND HEALTH INSURANCE 2 LATEST VERSIONS ACTUAL EXAM
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TEXAS GENERAL LINES LIFE, ACCIDENT ANDHEALTH INSURANCE 2 LATEST VERSIONS
2024-2025 ACTUAL EXAM
1) Sandra Timms, age 27, is advised by her producer
to purchase Life insurance to cover a 20-year-
amortized $50,000 business-improvement loan. Which
of the following plans would adequately protect Ms.
Timms at the minimum premium outlay?
A- $50,000 Whole Life policy
B- $50,000 Level Term policy for 20 years
C- $50,000 20 Pay Life policy
D- $50,000 Decreasing Term policy for 20 years -
ANSWER>>>>>D—A $50,000 Decreasing Term policy
for 20 years
Explanation: The key here is "minimum premium".
Term is the most inexpensive type of coverage. Since
Sandra's $50,000 loan will be paid off over 20 years
and the loan balance will decrease each year,
Decreasing Term makes sense. Decreasing Term is not
renewable.
2) A 45-year old customer who is seeking to
supplement his retirement income at age 65 would
not buy a:
,A- Deferred Annuity
B- Equity Indexed Annuity
C- Variable Annuity
D- Immediate Annuity - ANSWER>>>>>B- Equity
Indexed Annuity
3) John Livingston owns a 30-Pay Life policy that he
purchased at the age of 30. The cash value will equal
the face amount of the policy when he reaches the
age of:
A- 60
B- 70
C- 100
D- 30 - ANSWER>>>>>C- 100
Explanation: Limited Pay Life insurance policies such
as Life Paid Up at 65 or 20-Pay Life are simply
variations of Whole Life policies. The cash value will
equal face amount of the policy (at least) at the
maturity of the policy, which is always age 100 on
Whole Life policies. These limited-pay policies are
designed so that the insured may pay his or her
premiums faster and be "paid up" at a certain age.
However, just because the premiums are paid up
doesn't mean the policy has matured.
,4) Which of the following is an example of a Limited-
Pay Life policy?
A- Universal life
B- Whole Life
C- Life Paid-Up at Age 65
D- Renewable Term to Age 70 - ANSWER>>>>>C- Life
Paid-Up at Age 65
5) Which of the following policies provides the
greatest amount of protection for an insured's
premium dollar as well as some cash accumulation?
A- Annuity
B- Whole Life
C- Term
D- Limited-Pay Life - ANSWER>>>>>B- Whole Life
If we had not mentioned cash accumulation, the
answer would have been Term. However, Term has no
cash value, so the answer is Whole Life, which is the
most inexpensive type of permanent insurance and is
required to have a cash value after the third policy
year. Although Limited Pay Life is a type of Whole
Life, it is incorrect since it is usually quite expensive
due to the shortened pay-in period. Annuities have no
cash value except the money the annuitant paid in.
Since there is no death benefit, no protection is
offered.
, 6) Which of the following individual policy conversions
is usually permitted without any evidence of
insurability? - ANSWER>>>>>C- Conversion from a
Term policy to a Whole Life policy
7) Which of the following is NOT correct regarding
Ordinary Whole Life policies?
A- The premiums payments are owed annually until
you die or reach age 100
B- The cash value grows more quickly in the beginning
years of the policy
C- Coverage lasts for your own life
D- Ordinary Whole Life is a type of permanent
insurance - ANSWER>>>>>D- Ordinary Whole Life is a
type of permanent insurance
8) Which of the following statements is true about the
premium payment schedule for a Whole Life policy?
A- Premiums are payable for a designated period of
time only, after which coverage is no longer provided
B- Premiums are payable until the insured's
retirement only, after which coverage is continued
automatically until the insured's death
C- One premium, in the amount of the insured's
choice, is payable at the time of application, and the
balance of the premiums is deducted from the face
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