1. A father enters into a life insurance contract on behalf of his child.

In this case, the father is the

D – Applicant-Owner
2. The convertible feature of a team insurance policy provides that the policy may be
A – Changed to a permanent insurance policy without evidence of insurability.
3. A man with moderate means can have maximum protection possible through
C – Term Insurance
4. Mrs. Rose Cortez owns a policy which does not provide for the build up of cash values and
whose premiums remain level. Mrs. Cortex owns:
D – Level Term
5. A term insurance which allows the policy owners to convert it to a permanent insurance within a
specified period without evidence of insurability contains _____ feature:
A – Convertibility
6. When explaining dividends, the following information must be supplied
A – that they are not guaranteed.
7. Which of the following can give the longest protection?
C – Ordinary Life
8. Two attractive features of a term insurance are:
D – Convertibility and renewability
9. An optional rider which can be attached to a policy stopping further premium payments in the
event of disability is called
C – Waiver of Premium
10. Mr. Pedro Cruz became paralyzed as a result of Jumping out of the window in an attempt to
commit suicide. Under the usual provisions of a disability income policy, he would be entitled to
D – received neither disability income nor waiver of premiums
11. If an insured is disabled and his life insurance policy is being continued in force through the
waiver of premium, the dividends of the policy would
C – continue as if the owner is paying the premium
12. A policy with a minor as the proposed insured is called
B – Juvenile Policy
13. For the waiver of premium to be effective,

C – Both A & B

14. A person wanting greater coverage for the least amount of premium has an option of attaching
what rider in his permanent life policy?
B – Term insurance rider
15. One supplementary benefit offered is a payor’s benefit which is intended to
B – provide a waiver of premium benefit in the event of the death or disability of the
person paying the premiums.
16. Since the purchase of life insurance is a voluntary choice, the individual must meet
B – certain standards of health and occupation
17. In an application, the information that must be disclosed include
C – every fact in his knowledge that is material to the insurance
18. A hazardous occupation could be defined
D – All of the above
19. For life insurance coverage to be valid, insurable interest must exist
A – only at the inception of the policy
20. Under the law pertaining to life insurance
D – any person with insurable interest can be named irrevocable beneficiaries
21. When the proceed s of a life insurance policy are left with the company to earn interest
B – income tax is levied on the interest earnings of the proceeds.
22. If the insured dies during the grace period of an unpaid life insurance policy, the amount payable
to the beneficiary is usually the
C – face amount of the policy minus the unpaid premiums
23. When a policy is assigned absolutely
A – the assignee acquires all the rights and interests of the original policyholder
24. The three non-forfeiture values in a permanent policy are
D – Case surrender value, paid value, extended term insurance
25. A person has insurable interest in the life of
D – All of the above
26. If a loan is taken on a participating policy, dividends for that policy while there is a loan against
the policy will be
C – Unaffected
27. In the event that a policy elects the paid-up insurance option
B – The premium cease and protection continues with a reduced amount of coverage
28. Which one of the following statements is correct?
A – An insurance agent’s license will be renewed when the commissioner is satisfied that
the information in the application is accurate and all requirements are met
29. Which one of the following statements is correct?
B – An agent is allowed to share commissions with another licensed agent or agents but
with no one else
30. Which one of the following statements is correct?
D – rebating of premiums by an insurance agent is prohibited
31. Rebating is
D – premium discrimination against policyholder
32. Selling a person more insurance than what is warranted by his sources is called
A – Overloading
33. A life insurance company earns income from two main sources
A – premium income and investment income
34. The person who purchases the annuity plan is called the
D – Annuitant
35. In the event an employee leaves the company in which he is a member of its group insurance
policy, his group coverage can be changed to an individual policy using the
B – conversion privilege