Texas Life & Health Insurance Practice Exam - Section 2: Texas Life Law, Exams of Insurance law

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PRACTICE EXAM OF TEXAS LIFE &

HEALTH INSURANCE. "SECTION 2-

TEXAS LIFE LAW"

1. "Twisting" is a commonly-used term describing: A- The making of misleading representations as to the financial condition of any insurer B- A misrepresentation made to a policyholder for the purpose of inducing the lapse, forfeiture, surrender, retention or conversion of any policy of insurance C- Unfair avoidance of payment of policy benefits to which a claimant is entitled D- Giving, or promising to give, tangible or intangible items of value or service in order to induce a prospect to buy a policy of insurancecorrect answerB- A misrepresentation made to a policyholder for the purpose of inducing the lapse, forfeiture, surrender, retention or conversion of any policy of insurance
2. In the replacement of existing life insurance policies, regulations mandate disclosure of relevant information to all of the following EXCEPT: A- The existing insurer B- The beneficiaries of the existing policy C- The applicant D- The replacing insurercorrect answerB- The beneficiaries of the existing policy
3. Conversion of a Group Life Insurance policy may not be made to: A- 15 year level term B- 20-pay life C- Life paid up at age 65 D- Whole Lifecorrect answerA- 15 year level term
4. All of the following are true about Credit Life insurance EXCEPT: A- It must be written as group insurance

B- It is usually decreasing term insurance C- It may not be written for more than the amount of the loan D- It may not be written in connection with loans of more than 10 yearscorrect answerA- It must be written as group insurance

1. The Life Insurance Replacement Rule does not apply to which of the following: A- 10 year Convertible and Renewable Level Term B- Credit Life C- Whole Life Insurance D- Endowmentcorrect answerB- Credit Life
2. Which of the following is NOT true regarding the replacement of Life insurance: A- It is unlawful B- It may be detrimental C- It may lead to liability for Errors and Omissions D- Both the agent and the customer must sign the Notice Regarding Replacementcorrect answerA- It is unlawful
3. Which of the following is true about the Texas Life, Accident, Health and Hospital Service Insurance Guaranty Association: A- Coverage is unlimited B- Agents may use it's presence as an inducement to the sale C- All insurers must participate D- It protects the customers of insolvent insurance companiescorrect answerD- It protects the customers of insolvent insurance companies
4. Under what circumstances may a partially or totally blind person be offered life insurance at rates different from those applying to persons with unimpaired sight: A- When the risk is placed under the Guarantee Association B- No such discrimination is permitted

C- Upon application by the insurer to the Commissioner D- When such handicap is relevant to the risk of losscorrect answerD- When such handicap is relevant to the risk of loss

1. All are true about variable products sold in this state EXCEPT: A- Customers must bear the investment risk B- Agents must have a state Life insurance license and a federal Securities license C- Insurers invest the customer's premiums in their general account D- Rates of return are not guaranteedcorrect answerC- Insurers invest the customer's premiums in their general account
2. All of the following are true about Group Life insurance EXCEPT: A- The employer is the beneficiary B- The employee is the insured C- It is usually written as annual renewable term insurance D- There must be a minimum of 2 employeescorrect answerA- The employer is the beneficiary
3. False advertising includes which of the following: A- Stating that the policy you are selling has limitations and reductions B- Implying that you are the insurer rather than the agent C- Failing to include the premium in sales material you are disseminating D- Stating to a client that there is a difference in benefits between Whole Life Insurance and Term Life Insurancecorrect answerB- Implying that you are the insurer rather than the agent
4. Conversion to an Individual Whole Life Insurance policy written by the same company is permitted without a physical exam for ______days after termination of your employment: A- Group Life is not convertible B- 28 C- 31 D- 30correct answerC- 31

1. Where there is no unconditional refund provision of at least 10 days, a Buyer's Guide and a policy summary must be delivered to the prospective life insurance purchaser: A- Prior to filling out an application for insurance B- With the policy C- Prior to accepting an initial premium D- Upon issuance of the policycorrect answerC- Prior to accepting an initial premium
2. Which of the following is an unfair or deceptive act in connection with the sale of a life insurance policy: A- Referring to the guarantees available in the event of insurer insolvency B- Making a misleading statement concerning the financial condition of the insurer C- All answer options are correct D- Using a name or title that misrepresents the true nature of the policycorrect answerC- All answer options are correct
3. Credit Life Insurance: A- Shall not exceed the total amount of the indebtedness Texas Accident And Health B- Shall not exceed the total amount of the unpaid installments C- Has a maximum suicide clause of six months D- All answer options are correctcorrect answerD- All answer options are correct