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Health and Life Insurance Exam, Questions and Answers Latest Version Already Passed
What is the cash value in a whole life insurance policy?✔✔ The savings portion that grows over time and can be borrowed against
What is a beneficiary in a life insurance policy?✔✔ The person or entity designated to receive the death benefit
What does term life insurance provide?✔✔ Coverage for a specific period of time with no cash value
What is the face value of a life insurance policy?✔✔ The amount paid to the beneficiary upon the insured's death
What is a premium in an insurance policy?✔✔ The payment made to keep the policy active
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What is insurable interest?✔✔ A legitimate financial or emotional relationship with the insured
What happens if a policyholder stops paying premiums on a whole life policy?✔✔ The policy may lapse or be converted to reduced paid-up insurance
What is the grace period in a life insurance policy?✔✔ A set time after a missed premium during which coverage continues
What is the contestability period in a life insurance policy?✔✔ The first two years when the insurer can deny a claim due to fraud
What is a rider in insurance?✔✔ An additional benefit or modification added to the base policy
What is the purpose of accidental death benefit?✔✔ To pay an extra sum if the insured dies due to an accident
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What is underwriting in life insurance?✔✔ The process of evaluating risk and issuing a policy
What is a waiver of premium rider?✔✔ It waives future premiums if the insured becomes disabled
What is whole life insurance?✔✔ Permanent insurance with fixed premiums and a cash value component
What is universal life insurance?✔✔ Flexible premium life insurance with adjustable death benefits and cash value
What is the main difference between term and whole life insurance?✔✔ Term provides temporary coverage; whole life provides lifetime coverage
What does a life settlement involve?✔✔ Selling a life insurance policy to a third party for cash
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What is the incontestability clause?✔✔ A clause that prevents the insurer from voiding the policy after a period
What is a reinstatement clause?✔✔ It allows a lapsed policy to be reactivated under certain conditions
What is a health maintenance organization (HMO)?✔✔ A managed care plan focusing on preventive services and requiring referrals
What is a preferred provider organization (PPO)?✔✔ A health plan offering flexibility to see in- or out-of-network providers
What is coinsurance in health insurance?✔✔ The percentage of costs the insured shares with the insurer after deductible
What is a deductible in health insurance?✔✔ The amount paid by the insured before the insurer begins to pay
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