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Life and Health Insurance Final Exam Questions and Answers Latest Version Already Passed
What is the cash value in a whole life insurance policy?✔✔ A savings component that grows over time and can be borrowed against
What type of life insurance offers temporary coverage for a set period?✔✔ Term life insurance
What is the main feature of universal life insurance?✔✔ Flexible premiums and adjustable death benefits
What does the beneficiary receive when the insured dies under a life policy?✔✔ The death benefit
What does the incontestability clause do in a life insurance policy?✔✔ Prevents the insurer from voiding the policy after a set period, typically two years
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What is insurable interest?✔✔ A legitimate financial or emotional relationship between the policyholder and the insured
What is the purpose of a grace period in an insurance policy?✔✔ To allow extra time to pay premiums without canceling the policy
What does an accelerated death benefit allow?✔✔ The insured to access part of the death benefit while still alive if terminally ill
What is a rider in life or health insurance?✔✔ An additional benefit or feature added to a base policy
What does the free look period allow?✔✔ The policyholder to cancel a new policy for a full refund within a certain number of days
What is the main difference between term life and whole life insurance?✔✔ Term life is temporary; whole life is permanent with cash value
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What is underwriting in insurance?✔✔ The process of evaluating risk and issuing a policy
When does insurable interest need to exist in life insurance?✔✔ At the time of policy application
What is a waiver of premium rider?✔✔ It waives future premium payments if the insured becomes disabled
What is the purpose of a beneficiary designation?✔✔ To name the person or entity who receives the policy’s death benefit
What is the contestability period in life insurance?✔✔ A time frame during which the insurer can investigate and deny claims due to misrepresentation
What is the suicide clause in life insurance? 3 / 4
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✔✔ It denies the death benefit if the insured commits suicide within a certain time after the policy begins
What is the purpose of medical underwriting in health insurance?✔✔ To assess the applicant’s health risk before issuing coverage
What does major medical insurance cover?✔✔ A broad range of medical expenses, including hospital and surgical costs
What is coinsurance in health insurance?✔✔ A percentage of medical costs shared by the insured after the deductible is met
What is a deductible in a health policy?✔✔ The amount the insured pays out-of-pocket before insurance starts to pay
What is the purpose of a Health Maintenance Organization (HMO)?✔✔ To provide managed care focused on preventive services with lower costs
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