California Pre-Need Insurance Exam Correct and Verified Answers Graded A

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California Pre-Need Insurance Exam Correct and Verified Answers Graded A

• What does the insurance commissioner have the right to do if an agent lacks

authority from an insurer named on a binder for coverage?

• Request his certificate of authority
• Authorize agent with certificate of convenience
• Suspend or revoke the license of the agent
• Fine the insurance company

Correct Answer: c. Suspend or revoke the license of the agent

• Mike die before his annuity had paid out an amount at least equal to the purchase

price of the annuity. Paul's beneficiary continues to receive what?

• Straight life annuity
• Joint and last survivor annuity
• Refund life annuity
• Cash refund annuity

Correct Answer: c. Refund life annuity

3. What term describes the concept that the insurer and the insured share in:

• Stop loss limit
• Deductible
• Coinsurance
• Benefit restoration

Correct Answer: c. Coinsurance

4. The best example of fiduciary responsibility is:

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• Submitting premiums to the insurance company
• Serving the best interest of the client
• Annually reviewing the clients insurance
• Making sure a claim is handled promptly

Correct Answer: a. Submitting premiums to the insurance company

• Which is NOT part of a transitioning insurance?
• Solicitation
• Negotiation
• Execution of a contract
• Establishing a list of clients

Correct Answer: d. Establishing a list of clients

• A person applying for insurance has a hazardous job and the insurer wants to

exclude anything that happens at work. The type of policy would be:

• Limited
• Hazardous
• Non-occupational
• Level term

Correct Answer: c. Non-occupational

• Which of the following is not used to determining health insurance rates?
• Expense
• Interest
• Morbidity
• Mortality

Correct Answer: d. Mortality

8. All are methods for handling a risk except:

• Retain the risk

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• Transfer the risk
• Avoid the risk
• Identify and increase the hazards

Correct Answer: d. Identify and increase the hazards

• A term-to-65 life policy is paid up at 65
• True
• False

Correct Answer: b. False

• Who would be in the least need of purchasing errors and omissions insurance?
• Architect
• Insurance agent
• Football player-star quarterback
• Beautician

Correct Answer: c. Football player-star quarterback

• An insured bought an annuity 10 years ago. He will retire in five years. To determine

the value of the annuity, the number of accumulation units is:

• Variable annuity
• Fixed premium annuity
• Tax sheltered annuity
• Single payment annuity

Correct Answer: a. Variable annuity

• A person with an insurance agent/broker license is placing business with a

company with whom he has an appointment. He is acting as:

• A broker
• He may choose to act as either
• An agent
• None of the above

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Correct Answer: c. An agent

• The person whose life is the object of a life insurance policy is
• Applicant
• Policy owner
• Insured
• Beneficiary

Correct Answer: c. Insured

14. The incontestability period in a funeral policy is:

• 1 year from the date issue
• 2 years from the date issue
• 2 years from the date issue or from the date of reinstatement
• 6 months from the date issue or from date of reinstatement

Correct Answer: c. 2 years from the date issue or from the date of reinstatement

• A new person license will need to take continuing education courses. The

requirements are:

• 25 hours during the first four 12 month intervals
• 25 hours during the first two 12 month intervals
• 25 during the first 48 hours
• 30 hours during the first 24 month intervals

Correct Answer: a. 25 hours during the first four 12 month intervals

• What type of policy builds cash value?
• Term insurance
• Permanent policy
• All policies
• No policies

Correct Answer: b. Permanent policy