Life Insurance Exam-Illinois Latest Update 2025- 2026 160 Questions and 100% Verified Correct Answers Guaranteed A+
(tax) contributions can - CORRECT ANSWER: sometimes be tax deducted (tax
qualified) Tax on earnings and/or interest is usually postponed until they are withdrawn (tax deferred)
(Tax) contributions to TSA plans can - CORRECT ANSWER: usually be tax deducted
(tax qualified) tax on interest, earnings and gains is usually postponed until they are withdrawn (tax deferred)
(tax) dividends - CORRECT ANSWER: no tax on dividends (tax free)
(tax) Group life insurance employer can - CORRECT ANSWER: deduct the premiums
paid by the employer on face amounts up to $50,000
(tax) if an annuity is purchased or added as a rider the premiums usually... - CORRECT
ANSWER: cannot be tax deducted (non qualified)
(tax) when the monthly annuity income benefits are paid to the annuitant - CORRECT
ANSWER: part is considered a return on cash basis no tax (tax free)
part is considered gain subject to tax
- year incontestability provision - CORRECT ANSWER: 2 years after coverage takes
- / 3
effect and a claim cannot be contested (denied) after that time period due to any type of misstatement on the application
A plan established by an eligible person for a non-working spouse - CORRECT ANSWER: same contribution rules apply to the worker plan also apply to the spousal IRA plan
A Viatical Arrangement - CORRECT ANSWER: individual or org buys a life insurance policy from a terminally ill insured person for a sum of money less than face amount
Accelerated Benefit Provision - CORRECT ANSWER: is sometimes included and allows the insured to receive part of the policy face amount while still alive; also called a living benefit provision
Accidental Death Insurance - CORRECT ANSWER: it pays benefits for death caused by injuries sustained by accidental means
Actuarial Tables - CORRECT ANSWER: Are statistical tables that are used when
calculating premium rates and mortality loss reserves
Adjustable life - CORRECT ANSWER: it provides flexibility in premium amount, face amount and amount of cash value accumulation. The face amount can be increased or decreased within limitations specified in the policy
Adjustable life premium payments... - CORRECT ANSWER: can be increased or
decreased as long as it equals or exceeds minimum premium stated in the policy
Adverse Selection - CORRECT ANSWER: is insuring too many health conditions
insureds have before the policy is issued causing premium rates to be inadequate to pay claims
Annuitie plans (3 classifications) - CORRECT ANSWER: single, level, and flexible
- / 3
Annuities - CORRECT ANSWER: protect against the financial risk of out living a normal life expectancy
Application complete, premium paid, receipt issued. When does policy go into effect? -
CORRECT ANSWER: Immediately upon completion of the application subject to the
condition that the underwriter would have found the insured acceptable at the premium rate paid
Application includes (7 items) - CORRECT ANSWER: age, sex, occupation, dangerous recreational activities, aviation, smoking, agent's report
Applied to purchase paid up additional amounts of insurance - CORRECT ANSWER: is the automatic dividend option if the policy owner fails to select one
Automatic Premium Loan Provision must be - CORRECT ANSWER: sufficient loan
value to pay the entire premium due
Beneficiary provisions - CORRECT ANSWER: the policy owner may name and change
benficiaries unless an irrevocable beneficiary has been named
Business Life Insurance-Key Employee - CORRECT ANSWER: It is life insurance
purchased on the life of a key business employee; the business is both the policyowner and the beneficiary
Buy-sell agreement - CORRECT ANSWER: it is an agreement entered into by partners of a partnership or stockholders of a closely held corporation
Conditional Receipt - CORRECT ANSWER: temporary coverage from date of
application to the date policy delivers subject to the condition that the underwriter would have found the applicant acceptable at the premium rate paid
- / 3