1.

Milo is 30 years old and looking to purchase life insurance with a $500,000
face amount. The cost will be one of the determining factors in his decision.
To help Milo in his decision process, list the following policies in order from the
lowest initial annual premium to the highest.
a) Renewable 20-year term; Term-100; non-participating whole life payable for life;
Participating whole life payable for life.
b) Renewable 20-year term; Term-100; Participating whole life payable for life; non-
Participating whole life payable for life.
c) Term-100; Renewable 20-year term; non-participating whole life payable for life;
Participating whole life payable for life.
d) Participating whole life payable for life; non-participating whole life payable for life;
Term-100; Renewable 20-year term.

2. With the help of her life insurance agent, Sidney has determined that her
current insurance needs are temporary, and that $300,000 coverage is sufficient
to meet those needs. However, there is a possibility that those needs will grow
as Sidney plans on buying her first house in a few years and having children.
Which rider should she consider adding to her term life insurance
policy?
a) Paid-up additions rider.
b) Guaranteed insurability benefit rider.
c) Payor waiver benefit rider.
d) Extended term coverage rider.

3. Harsha is concerned about providing for his family. His monthly take-home pay is
$5,250 after taxes and deductions. Without taking into account the impact of
inflation and income taxes on income, calculate the amount of life insurance Harsha
should by using the income replacement approach and assuming a 6% annual rate of
return.
a) $2,500,000
b) $750,000
c) $1,050,000
d) $1,500,000

4. Sylvia applied for a $1,000,000 Life insurance policy on her life. Her job involves
frequent travel and she wanted to make sure her children’s lives are secure in case she
dies prematurely. Sylvia Paid the first policy premium upon delivery and a couple of
days later notices an exclusion clause that denies death benefit if she dies while
travelling. Sylvia is disappointed and decides to return the policy for cancellation.
which of the following is true with regard to Sylvia’s situation?
a) Sylvia Can cancel the policy anytime but she is unlikely to get a refund as the policy has
already been approved and delivered
b) Sylvia should keep the policy for a year she is unlikely to get a refund and then
let it lapse without making further payments.
c) Sylvia should be able to negotiate with the insurer and have the travel exclusion
removed instead of cancelling the policy.
d) Sylvia should be able to cancel the policy and get a refund if she returns the policy
within 10 days after policy issue.

5. Ye-jun Is employed with a large manufacturer that provides both life and health
group insurance on a non-contributory basis. Ye-jun Is covered up to double his
salary through his life insurance and his wife is covered up to $100,000 through
dependent life insurance. Ye-jun’s life policy names his parents as beneficiaries. His
wife’s plan names Ye-jun as the beneficiary.
What is the benefit of the life insurance plans?
a) Ye-jun and his wife’s premiums are tax deductible, and the death benefits are tax free.
b) Ye-jun’s premium is tax deductible and both the dependent insurance and life
insurance coverage on Ye-jun will be taxed when given to his parents.
c) Ye-jun’s Parents will receive the death benefit of his policy tax free and Ye-jun we will
not have to pay premiums on his wife’s policy.
d) Ye-jun will receive the $100,000 tax free if his wife dies. His parents will
receive the death benefit of his policy tax free if he dies.

6. Caleb was enrolled into his company's group insurance plan after completing a
waiting period of three months. The company offers optional coverage in the form of
term life insurance and Caleb applies for the additional coverage. which of the
following statements with regard to his additional coverage his FALSE?
a) He will be provided additional coverage in multiples of fixed units.
b) He must be enrolled in the plan’s base policy before buying additional coverage.
c) He will have to pay 50% of the premiums for the added coverage.
d) He might be required to provide evidence of insurability

7. Adeeba wants to know how participating policy differs from a non-participating

policy.
Which of her agent’s explanation is correct?
a) Participating policyholder participant in the profits of the insurance company
just like any shareholder of the insurance company. Non- participating
shareholders do not get a share of the profits of the insurer.
b) Participating policies issue dividends to the policyholders which are treated the
same as stock dividends issued to shareholders, whereas non- participating
policies do not issue dividends.
c) Participating policy holders share the risks of the insurers. Hence, the policy holders are
rewarded if there is a surplus and penalized if there are shortfalls in the policy reserves.

d) Participating policy holders receive policy dividends if there is a surplus in the policy
reserves. These dividends are different from stock dividends received by
shareholders as they are taxed differently. Non-participating policies do not issue
dividends to policy holders.

8. Carlos owns a $500,000 UL insurance policy and he wishes to withdraw some cash from
the policy to pay for home renovations. He contacts his insurance agent to
understand the process of withdrawing cash from the policy. His agent advises Carlos
that he should get a policy loan instead. which of the following statements justifies the
agent’s advice?
a) With a policy loan, funds continue to earn tax-sheltered income within the
policy’s investment account.
b) A policy loan is not considered as a taxable disposition and does not result in taxable
income to Carlos.
c) The interest rate charged on a policy loan is relatively less making it more
appealing than a cash withdrawal.
d) There Is no limit with regard to the amount of loan that can be taken against the
policy’s cash value.

9. Skyler’s $500,000 life insurance policy has a terminal illness (TI) benefit clause, which
provides the benefit of 25% of the face amount Up to a maximum of $100,000.
Skyler has been diagnosed with a terminal illness. The doctors gave him between 12
and 18 months to live. Skyler Submitted a claim for the TI benefit and it was
approved.
When Skyler dies, how much will his beneficiary receive?
a) $400,000
b) $375,000
c) $475,000
d) $500,0and Danny
are a couple in
their 40s who are
meeting Roy, an
insurance agent,
 to purchase a life
insurance policy
on Sylvia’s life. As
part of the life
insurance needs
analysis, Roy
prepares the
following list of
assets owned by
Sylvia:
Which of the following of Sylvia’s assets will be categorised as fixed assets?

Checking account $20,000

Cashable GIC $51,000
Jewellery $40,000
House $600,000
Personal RRSP $23,000
Car $35,000
a) House, car and personal RRSP
b) Chequing account and personal RRSP
c) Jewellery, house, and car
d) Cashable GIC, car, and personal RRSP

10. Arun is 34 years old and is healthy and active. He recently applied for life insurance
coverage. His parents are in their early 70s and are in good health. Arun enjoys
biking and racing cars in the summer.
What is the most likely outcome for Arun’s life insurance applications?
a) Policy Declined.
b) Policy issued at rated rates.
c) Policy issued at rated rates with exclusions for biking and racing cars.
d) policy issued at standard rates but with an exclusion for racing cars.

11. Chelsea Has a convertible term life insurance policy. she is thinking of exercising the
conversion option but wants to clarify whether the suicide exclusion clause and the
 incontestability Provisions will start a fresh on the conversion of the policy to a
permanent policy. which of the following is correct regarding the conversion option of
a term life policy?
a) A permanent policy is acquired which will be subject to a new two-year
contestability period and a new suicide exclusion period.
b) A permanent policy is acquired that will be subject to a new two-year
contestability period but not a new suicide exclusion period.
c) A permanent policy is acquired that will be subject to a new suicide exclusion period
but not to a new two-year contestability period.
d) A permanent policy is acquired without being subject to a new two-year
contestability period and suicide exclusion period.

12. Roy is 70 years old and is receiving a monthly pension of $1,100 from his
defined benefit pension plan. his wife, Tamara, is dependent on him financially
and Roy wants to ensure that she is financially secure after his death. he would like to
know the minimum pension amount payable to Tamara upon his death to plan her
needs accordingly. which of the following reflects the minimum survivor benefit
payable to Tamara?
a) $550
b) $660
c) $825
d) $770

13. Silverio has been a professor at the University of London for over two decades. He
leads a modest lifestyle and he always had enough extra funds to enjoy
vacations with his wife, provide a good education for his children, add indulge in a few
luxuries for himself. he decided that he would like to leave a legacy of $150,000
to the university. after talking with his insurance advisor, Silverio decided to
purchase a universal life insurance policy.
which of the following features would be the most affordable method to help meet his
objectives?
a) Level death benefit, level cost of insurance
b) Indexed death benefit, Adjustable premium rates
c) level death benefit, yearly renewable term insurance
d) Indexed death benefit, level cost of insurance
14. When it comes to determining the amount of life insurance required with the
income replacement approach, an increase in which of the following will result in a
lower insurance amount?
a) Inflation
b) amount of income that must be replaced
c) income tax rate
d) return on investment

15. Prisha is 44 years old, and she purchased a renewable 10-year term insurance policy on
her life when she was 35. She is of excellent health and feels the granted renewal rates
mentioned her policy are a little higher than expected. She meets with her
insurance agent to ask if she should renew her existing policy or purchase a new one.
which of the following recommendations should the agent provide?
a) Prisha should opt for renewal as premiums for a new policy will be relatively higher as
it will be based on her current age.
b) Prisha should opt for a new policy as renewing a policy requires medical
underwriting resulting in higher premiums.
c) Prisha should opt for renewal has a new policy will include 3 years
incontestability period and suicide clauses.
d) Prisha should opt for a new policy as its premium are likely to be lower than that of
her existing policy upon renewal because of her health.

16. Austin wants an estimate of the amount of insurance he must procure to

provide income to his family in the event of his death so that they can maintain
adequate lifestyle. he estimates that his family will require $70,000 each year before
taxes. his wife is employed annually earns $48,000. assuming that the interest rate is
4% and using the capital retention approach, how much insurance must Austin procure
For the purpose of covering the income shortfall that will be faced by his family in the
event of his death?
a) $650,000
b) $350,000
c) $450,000
d) $550,000

17. Bahadur is an auditor, and he meets with his insurance agent to purchase a
permanent life insurance policy that offers flexible investment options. Based on
needs analysis, his agent recommends a UL policy due to its investment
features. Bahadur asks the agent to explain in detail the policy's investment attributes.
 Which of the following information is the agent MOST likely to provide?
a) A UL policy's outcomes are not affected by small changes in investment
performance.
b) In a UL policy, the insurance company decides how policy reserves are invested.
c) A UL policy does not require the policyholder to manage the investment account
on an ongoing basis.
d) A UL policy gives the policyholder a way to invest in a tax- sheltered
environment.

18. Blake, age 42, believes in the importance of life insurance and understands how
health problems could make it harder to obtain life insurance. For this reason, Blake is
looking to buy life insurance on his 6-year-old son's life. What's important to Blake is
that his son, Riley, is covered for life, but he does not want Riley to be burdened by the
payment of premiums once the policy is assigned to him as a young adult. He
would also like the coverage amount to increase over time because he realizes the
value of the dollar today will be lower many years from now.
Which of the following policies would meet Blake's objectives?
a) T-100 insurance
b) 20-year pay participating whole life with cash dividend option
c) Participating whole life payable to age 65 with paid-up addition option.
d) 20-year pay participating whole life with PUA dividend option

19. Anita is 51 years old and is planning to apply for a life insurance policy. She contacts
Bella, an insurance agent and schedules a meeting. During the meeting, Anita
informs Bella that she was diagnosed with a heart problem a few years ago and is
receiving treatment. Considering her health status, Anita is anxious and asks
Bella about additional requirements for applying for a life insurance policy.
Which of the following responses is Bella likely to provide Anita?
a) Anita will either be required to provide an APS or a medical exam, but not both,
as both serve the same purpose.
b) Anita will only be required to provide a medical exam and not an APS as it only
provides a summary of the life insured's medical history.
c) Anita will only be required to provide an APS as she was already diagnosed with the
condition and is receiving treatment.
d) Anita will be required to provide an APS as well as a medical exam if the
underwriter has concerns about her health.

20. Cedric and Audra are recently engaged and are evaluating their insurance
needs.Their combined earned income is enough to buy a house with a 75%
 mortgage:$112,000 with a 15-year amortization. Cedric and Audra's employers do not
have a pension plan, but they have been contributing to their individual
Registered Retirement Savings Plans (RRSPs) for several years. If Cedric dies
prematurely, Audra will need an income supplement to replace at least part of Cedric's
earned income. Which is the best product to protect the outstanding mortgage?

a) Universal Life Insurance

b) 10-year non-renewable term insurance
c) 15-year renewable and convertible term insurance
d) Term insurance to age 65.

21. Jango earns an annual salary of $80,000 from his employer. His group life insurance
coverage offered by his employer is two times his salary, up to a maximum of
$200,000. Jango has added coverage for his dependants - his spouse, Randy, is
covered for $20,000 and them daughter, Britney, is covered for $10,000. The group
plan automatically offers accidental death coverage on the lives insured.
The accidental death (AD) benefit for Jango is equal to 100% of his group life insurance
coverage. The AD benefit for Randy is 50% of Jango's AD coverage, and for each
child, it is 10% of Jango's AD coverage.
If Randy and Britney die in a car accident, what will be the total benefit paid
under the group plan?
a) $40,100
b) $126,000
c) $60,000
d) $111,600

22. Mira and her spouse are both employed, and they have a child. Mira is covered
under the workers' compensation program. She meets with an insurance agent
to purchase a suitable insurance product. While assessing Mira's situation, the
agent does not take the workers' compensation benefit into consideration.
Mira is surprised and questions why. Which of the following responses is the agent
likely to provide?
a) The benefit paid by the program does not include funeral costs.
b) The program does not pay benefits to children when the surviving spouse is employed.
c) The program pays a benefit only when the covered employee was not at fault.
d) The program does not pay benefits when death occurs outside of work.
23. Which of the following policyholders' life insurance contracts is LEAST likely to be
cancelled upon non-payment of premiums beyond the grace period?
a) 50-year-old Mehr, who is the policyholder and the life insured of a T-100 policy
b) 61-years-old Hasna, who owns a minimally funded universal life insurance policy
c) 48-years-old Zaya, who owns a whole life insurance policy with considerably high CSV
d) 36-years-old Lucia, who owns a 10-year term insurance policy that requires annual
payments

24. Abbas owned a $400,000 whole life policy for which he was the life insured and his
wife the beneficiary. When the policy had a CSV of $105,000, he took a policy loan of
$60,000 to purchase a car, and the loan's interest rate was 4%, compounded
annually. Three years later, he died. At the time of this death, the CSV had increased to
$120,000 and he had not made any payments on the loan. How much death
benefit will be paid to his wife?
a) $340,000 minus accrued interest
b) $460,000 minus accrued interest
c) $400,000 minus accrued interest
d) $520,000 minus accrued interest

25. Amon and Edrice are a couple in their late 50s. They live in a rented apartment and do
not have any children. Amon is employed and wishes to buy a permanent life
insurance policy with affordable premiums. He is not keen on receiving dividends but
prefers flexible investment options. His insurance needs are likely to remain constant
and not increase overtime. Which of the following insurance products should be
recommended for Amon?
a) A limited payment term-100 life insurance policy
b) A UL policy with an indexed death benefit option
c) A participating whole life insurance policy
d) A UL policy with a level death benefit option

26. Akira is the sole owner of a microbrewery. Because of his business's success, which is
due in large part to their skilled master brewer, the bank agreed to offer the
company a $750,000 demand loan to expand its production capacity. Akira is a single
father and has one son who works at the microbrewery and may one day take over the
company. Which of the following issues could be addressed with life insurance and
should be discussed with Akira?
a) Loss of skills and equality for family members.
b) Loss of skills and creditor demands
c) Equality for family members and family interference
d) Family interference and creditor demands

27. Sam applies for a whole life insurance policy through his insurance agent and
informs the agent that he would like to make premium payments in the most cost-
efficient way. The agent is likely to recommend that Sam pay his premiums:
a) Monthly.
b) Semi-annually.
c) Annually.
d) Quarterly

28. 29. Carlos owns a $500,000 UL insurance policy and he wishes to withdraw some cash
from the policy to pay for home renovations. He contacts his insurance agent to
understand the process of withdrawing cash from the policy. His agent advises Carlos
that he should get a policy loan instead.
Which of the following statements justifies the agent's advice?
a) The interest rate charged on a policy loan is relatively less making it more
appealing than a cash withdrawal
b) A policy loan is not considered as a taxable disposition and does not result in taxable
income to Carlos.
c) There is no limit with regard to the amount of loan that can be taken against the policy
cash value.
d) With a policy loan, funds continue to earn tax-sheltered income within the
policy investment account

29. For which of the following individuals is a UL policy the preferable option?
a) Hadley, a self-employed underwater welder who earns variable income from year to
year and likes to be involved in the management of his financial affairs.
b) Ruby, who is self admittedly not financially disciplined - if she can have access
to her savings, she will use them to urge strikes to buy high priced items.
c) Piyush, who is easily overwhelmed with more complex products and prefer simple,
guaranteed products.
d) Safiya, who earns an above average, stable income and who is risk averse.

30. Pascal plans on leaving his cottage, value at $400,000, to his son, Audric. the tax
liability on the cottage that will be triggered by Pascal’s death will be $75,000.
In order to be fair to his daughter, Donna, Pascal wants to leave any equal value
 Amount through life insurance. Finally, Pascal’s brother, Carson, was assessed unfit to
manage his financial affairs. Pascal provides Carson with Financial support. Pascal
Would like the financial support he gives to his brother to continue even following the
event of his death. it was determined that an amount of $300,000 will meet this
specific goal.
Who would be the most appropriate beneficiary for the various amount Needed to
realize Pascal’s wishes?
a) The estate as the beneficiary of the $75,000 for tax liability; Donna as a
beneficiary of $400,000; Carson as beneficiary of the $300,000 amount.
b) The estate as the beneficiary for $475,000 and trust for the benefit of Carson as a
beneficiary of the $300,000 amount.
c) Audric as beneficiary of the $225000 for tax liability; and Donna as a beneficiary
of $475,000 requiring them to provide support for Carson.
d) The estate as the beneficiary of $75,000 for tax liability. Donna as a
beneficiary of $400,000; a trust for the benefit of Carson as a beneficiary of the
$300,000 amount.

31. 32. Bethany is covered under her companies group insurance plan that provides
an option to purchase voluntary AD&D coverage. the death benefit offered under the
policy is $110,000, which equals Bethany’s annual salary. she purchased three units of
voluntary AD&D coverage at, $30,000 per unit. If Bethany dies In an accident, her
beneficiary will receive;
a) $210,000
b) $140,000
c) $200,000
d) $110,000

32. Abiona Leeds $100,000 to start her own business and she owns a $500,000 life
insurance policy which she plans to use as collateral to obtain a loan. She partially
assigns the policy to the lender as a form of security add borrows the required
money.
Which of the following rights does the lender have because of this partial
agreement?
a) The lender can prevent Abiona from performing any action on the policy that would
diminish the lender activity.
b) If Abiona dies without repaying the loan, the lender will become the new policy
holder and will have full control the policy.
c) As the new policyholder, the lender can fully surrender the policy if Abiona fails to
repay the loan on time.
d) The lender can withdraw funds from the policy if Abiona fails to repay the loan
on time.
33. Ehan owns a participating whole life policy in which he has named his spouse as the
beneficiary. He has chosen the accumulation option for dividend payment. Which of
the following statements is true about this dividend payment?
a) If Ehan dies, the funds in the accumulation account will be paid to his estate.
b) Ehan will be required to make minimum yearly withdrawals from the
accumulation account
c) Ehan’s dividends will be paid to a side account from which he can withdraw anytime.
d) Ehan will not have to pay tax for the income earned through the invested
dividends.

34. Garvin and Floyd are partners in an e-learning company, and each owns 50% of the
company’s 100 shares. They have implemented a cross-purchase buy-sell agreement
funded by corporate-owned insurance. Which of the following outcomes can be
expected if Gavin dies?
a) The insurance proceeds will be paid to Gavin’s estate upon his death.
b) The company pays Gavin’s estate for his shares with a promissory note.
c) Gavin’s 50 shares will be transferred to the company upon his death.
d) The company will receive the insurance proceeds which will be transferred to its
CDA.

35. Davis, a new agent, is going to deliver his first policy as a life insurance
representative. He asks you what he must do to complete the delivery process.
What do you tell Davis?
a) Complete the agent’s comments section. Obtain a premium for the
insurance, declaration of insurability, and confirmation of delivery receipt from the
client.
b) Complete the medical questionnaire. Obtain a premium for the insurance and
confirmation of delivery receipt from the client.
c) Meet the client and obtain the premium for the insurance, declaration of
insurability, and confirmation of delivery receipt from the client.
d) Deliver the policy personally or by mail and obtain a premium for the insurance.

36. Ginez owns a company and decides to introduce a group insurance policy to his
eligible employees. All employees will be enrolled into the plan automatically as
 soon as they complete the probationary period. Which of the following rights will the
employees have as members of the group insurance plan?
a) Name a beneficiary.
b) Choose the type of coverage.
c) Choose the method of premium payment.
d) Add a supplementary benefit.

37. Bryn, married with 2 children, currently has a $250,000 UL policy with a minimum
annual premium of $1,000. For the past 5 years, he has been paying $5,000 a year. Last
month, Byrn was laid off. What would be the best option for Bryn to choose
regarding his insurance premiums?
a) He can stop paying his premiums until he gets a new job, or until the
investment account no longer supports the mortality and expense
deductions.
b) He should invest the excess premiums in an aggressive segregated fund to
increase the return should he need to use some of the savings in the policy.
c) He should reduce his premium payments to the minimum required even if he has to
borrow the money to do so. This prevents his policy form being cancelled.
d) He should surrender his policy and use the proceeds to support himself and his family.

38. Spencer has been a Canadian citizen for the last 20 years and has recently applied for a
life insurance policy. The underwriter notes that Spencer is exceptionally healthy and
would normally be eligible for preferred rates. However, the underwriter notes that
Spencer travels every year to visit his mother in Iraq, a country facing turmoil and
armed conflict.
What is the underwriter most likely to do in Spencer’s case?
a) Issue a standard policy
b) Exclude death from coverage while in Iraq
c) Reduce policy coverage.
d) Issue a rated policy

39. Estelle owns a renewable 5-year term insurance policy which she purchased four
years ago through her agent, Benjamin. Estelle’s health has declined significantly
since the policy issue. Benjamin suggests that Estelle purchase a new insurance
policy from another insurer instead of renewing her existing policy. He does not
mention the likelihood of premiums being high as she will have to provide evidence of
 insurability for a new policy. It is apparent that Benjamin is trying to make a profit out
of the ignorance. Which of the following practices is Benjamin engaging in?
a) Twisting
b) Churning
c) Inducing
d) Fronting

40. For which of the following policy assignments does a rollover not apply?
a) Charlie assigns his life insurance policy to his daughter. Charlie is the life insured of
the policy being assigned.
b) Zahur assigns his life insurance policy to his son, Montu. Montu is the life
insured of the policy being assigned.
c) Elena assigns her life insurance policy to her husband. Her daughter is the
policy’s designated beneficiary.
d) Eduardo assigns the life insurance policy he owns on the life of his grandson to his
daughter Leticia.

41. For the past 8 years, Baqer had a $500,000 Term life insurance with an accident
death (AD) rider, which doubles the Death benefit payable if he dies in an accident. one
week ago, Baqer was involved in a car accident, and he was pronounced dead at the
scene. An autopsy later revealed that Baqer suffered a mild stroke, which was
likely a contributing cause of the accident. In the coroner’s report, the cause of
Baqer’s death is attributed to the injuries suffered in the accident.
a) $1,500,000
b) $1,000,000
c) $0
d) $500,000

42. 43. Azmi Is a 31-year-old busy single mother of a 3-year-old boy. she works as a lawyer
and is planning to buy a house in five years. she wants to purchase a life insurance
policy on her life so that her son’s life is secure if she dies prematurely. based on her
needs, her insurance agent recommends a participating whole life insurance policy.
Azmi would like to know why the agents recommendation is better than buying
a term insurance policy. The agent would say that:
a) While Azmi Is relatively young, premiums of whole life policy are generally lower
than premiums for the same amount of term life coverage.
b) Unlike term insurance, coverage offered by a whole life policy can be customize
to a specific duration.
c) A participating whole life policy provides guaranteed policy dividends, an option
not available with term insurance policy.
d) Unlike term insurance, A whole life policy never requires renewal and will
remain in force even if Azmi’s health declines.

43. Ying is a business reporter and a frequent traveller. He travels internationally to

compete in Hang Gliding competition. He drinks an occasional glass of wine. He
recently received two tickets for speeding.
Which of the following might lead to Ying getting a rated
policy?
a) Occasional wine consumption, frequent travel, Hang Gliding, driving record
b) Occasional wine consumption, frequent travel, driving record
c) frequent travel, Hang Gliding, occupation
d) frequent travel, Hang Gliding, driving record

44. Dominic applied for a life insurance policy with the help of his agent Aftab. Dominic
was in hurry while filling the application form which caused Aftab to submit the
application for underwriting with some details missing. Which of the following
outcomes can be expected with regard to Dominic’s application?
a) The underwriter will send a notice to Dominic requiring him to send the
missing information within 10 days in order for his application to be
processed.
b) The underwriter will dismiss Domini’s application and he will have to submit a new
application with complete information.
c) The under writer will continue processing the application but Dominic will be required
to provide those missing details at the time of policy issue.
d) The underwriter will return the application and require Aftab to obtain the
missing information from Dominic which could delay the process.

45. Jade owns Golden Travels Ltd. and estimates that the company has an
unrealized capital gain of $750,000 based on the undeveloped land it owns. Jade wants
to make sure that when he dies, funds will be available to pay the outstanding taxes
resulting from the gain, add that his children can take over Golden Travels Ltd.
without significant debt. However, Jade is also considering selling the business over the
next few years, in which case, he will not need insurance.
 What option will offer Jade the coverage he requires for as long as he owns Golden
Travels Ltd., as well as provide some benefits in case he decides to cancel the policy
prior to his death?
a) 20-year decreasing term insurance
b) 10-year level term insurance
c) Whole life insurance
d) Term-to-100 insurance

46. Among The following individual Sony new agents’ prospects list, who may not be
eligible to apply for the insurance coverage?
a) Oshay, who is 60 years old and is a retired Canadian citizen.
b) Leslie, who is a dependent spouse of a Canadian permanent resident.
c) Zara, who has an international student visa, and he is studying at the University
of Toronto.
d) Sophie, who has a work permit and works as a home support worker

47. Wesley and Esther are homeowners. Their mortgage balance is $225,000 And their
monthly mortgage payments are $1500. Wesley does all of the maintenance around
the house: lawn mowing, landscaping, snow removal, Painting, and small repairs
when required. If Wesley dies, Esther wants to be able to keep house for 20 years.
While she would continue to work, her income would only be sufficient to cover the
annual property taxes and the utilities for the house. Esther would not be able
to afford the mortgage payments, and she would not do the home maintenance that
Wesley does.
What should the insurance on Wesley’s life be able to cover at a minimum to
permit
Esther to keep the
house?
a) repayment of the mortgage loan balance
b) payment of the mortgage loan balance, the monthly mortgage payments for the
remainder of the loan amortization, and the annual costs of house maintenance
for 20 years.
c) monthly mortgage payment for the remainder of the loan amortization.
d) repayment of the mortgage loan balance and the annual costs of house
maintenance for 20 years
48. Theo and Josie Have just consolidated their debts into a $200,000 mortgage
loan.They expect to repay this loan over a 19-year with fixed monthly payments.
They would like to ensure that if one of them dies, the survivor would have
sufficient funds to reimburse the loan balance. they are concerned about the
cost of life insurance and are looking for the list expensive option to cover their needs.
Which life insurance policy best meets Theo and Josei’s need?
a) $200,000 joint first to die decreasing 30-year term policy.
b) $200,000 joint first to die level 20-year term life insurance.
c) $200,000 joint last to die whole life policy
d) $200,000 joint first to die decreasing 20-year term policy

49. 50. Luis Is newly employed at a company that offers group insurance to its
eligible employees. Luis will be enrolled into the plan automatically upon
completing probation. which of the following will Luis receive up on joining the plan?
a) a benefit booklet
b) a policy illustration
c) a copy of the master contract.
d) an information folder

50. Fernando owns a UL policy, and his investment account is performing well with high
returns. he wants to know about the ways of maintaining his policies exempt status
due to the higher-than-expected returns. he meets with his insurance agent for
suggestions. his agent informs Fernando that the insurance company will ensure that
the policy remains exempt by implementing certain changes. these changes include all
of the following. EXCEPT:
a) Withdrawing premiums
b) increasing the face amount
c) moving funds to a shuttle account
d) registering a separate account

51. Jomana is a front-line worker, and she is married to Karim. They have two children aged
8 and 12. Jomana wishes to purchase a permanent life insurance policy on her life and
would like to include coverage for her husband and children. Her agent recommends a
whole life insurance policy with a family coverage rider. Which of the following
statements is true about the family coverage rider recommended by the agent?
a) The family coverage rider will be underwritten based on Jomana's attained age
b) There are limits to the number of units that Jomana can purchase under the rider.
c) The policy premium will be high for Jomana as the rider covers two children
d) There will be no age limit with regard to Karim's coverage.

52. Jasmine has found love again after many years of heartbreak. As she approaches
retirement, she and her new love, Alina, would like to spend as much time together as
possible and Alina will be moving in with Jasmine and her children. They discuss making
changes to Jasmine's existing policy to fund her new circumstances. She would like to
add Alina to her policy and change it to a joint-last-to-die so that her children are taken
care of.
Identify the correct action the agent should take.
a) The agent will need to fill out the appropriate form and submit it as an administrative
change
b) The agent will need to send the policy to the underwriter as the change is substantial
c) The agent will need to sell Alina her own policy as Jasmine's can't be altered as her
children are the beneficiaries
d) The agent will need to have Jasmine surrender her policy and purchase

53. Through his employer, Joshua has dental insurance coverage with a co-insurance plan.
Joshua must pay 20% of his dental care costs and his insurance coverage will pay the
other 80%. Which risk management strategies are applied for in Joshuas dental care
costs?
a. Risk reduction and risk retention
b. Risk avoidance and risk reduction
c. Risk retention and risk transfer
d. Risk avoidance and risk transfer

54. Dominic owns a recruitment consultancy; ABC Corp., which is a Canadian-controlled

private corporation (CCPC). If Dominic dies, he will be deemed to have disposed of his
shares in the business for its fair market value, and therefore, he anticipates a taxable
capital pain of over $500,000 triggered upon his death. Being a CCPC, the capital gain
arising from Dominic's death will be sheltered by:
a) MTAR
b) LIRD
c) LCGE
d) NAAR

55. Georgia is 54 years old and earns adequately, she wishes to purchase a life Insurance
policy that provides permanent coverage. She might use the policy to obtain loans and
would like to withdraw dividends when in need. Based on the needs analysis, her
insurance agent recommends that she should purchase a participating whole life
insurance policy. Before accepting his recommendation, Georgia asks him if there are
 any drawbacks to the recommendation. Which of the following responses is the agent
most likely to provide?
a) Policy loans will have to be paid within a specific time
b) Policy dividends are not guaranteed
c) Premiums are likely to increase in the later year
d) Comrade stops as soon as a premium payment is missed

56. Edwin has a whole life insurance policy with a $150,000 CSV and a $60,000 ACB. Based
on the wording of his policy, he can take a policy loan up to a maximum of 85% of the
policy's CV. He wants to take a loan of $50,000 but does not want to trigger any tax on
the loan.
What is the maximum loan amount that he can take out without triggering Income tax?
a) $76,500
b) $90,000
c) $60,000
d) $51,000

57. Freya is 40 years old, and she meets with her insurance agent to purchase a life
insurance policy. She has a family history of cancer, and she wishes to purchase a policy
that provides a living benefit that she can use if she is diagnosed with a critical illness.
She wants to receive the benefit regardless of the severity of the Illness. Which of the
following supplemental benefits accurately meets her request?
a) Dread disease benefit
b) Terminal illness benefit
c) Critical diagnosis benefit
d) Declining health benefit

58. Cho and Shima, both 35 years old, were married seven years ago. They have two
children. Zhu and Aran who are 5 and 4 years old respectively. Cho. Shima, and their
two-child good health. Cho and Shima work full time and have a combined annual
income of $135,000, but do not participate in any group insurance plans.
Which of the following risks to the family can be managed using the risk retention
strategy?
a) Critical illness afflicting Cho
b) Prescription drug expenses for the family
c) Long-term disability afflicting Shima
d) Terminal illness afflicting Shima

59. Sam applies for a whole life insurance policy through his insurance agent and informs
the agent that he would like to make premium payments in the most cost-efficient way.
The agent is likely to recommend that Sam pay is premiums:
a. monthly
b. quarterly
c. annually
d. semiannually

60. Bruce’s application for a life insurance policy was denied a few years ago due to his
health history. He recently moved to a different city and applied for a new life insurance
policy without disclosing his health history in order to avoid another rejection. During
the underwriting process, Bruce was required to undergo a medical exam and his
application was eventually denied. Which of the following would have given the
underwriter to investigate Bruce’s health?
a. A MIB report
b. An MVA
c. An inspection reports
d. An APS

61. For the past five years, Calista has been living with Remy, her common-law spouse. They
have two children: 15-year-old Bella, Remy's child from his previous union, and 4-year-
old Rylan, the couple's adopted son. Because of her health problems, Calista's mother,
Naomi, also lives with the couple as she needs Calista and Remy's help. Calista works
full-time and participates in her employer's group insurance plan. She checks the
dependent coverage option to provide life insurance coverage for her family.
Which of the following members of Calista’s family will NOT be covered under the
dependent coverage option?
a) Naomi
b) Remy
c) Bella
d) Rylan

62. Xavier just submitted a death claim for both his father's individual universal life and
group life policies. He would like to know if the death benefits are taxable.
What was the answer for Xavier’s question?
a. The individual policy is a universal life and is classified as a non-exempt policy, the death
benefit is fully taxable. The group life death benefit is always tax-free.
b. The death benefit for an individual is always tax-free. If the employer paid the group life
premium portion, the premium would not be added to Xaviers income, and the death
benefit is tax free too.
c. Death Benefits for both individual and group life insurance are fully taxable.
d. Death benefits for individual and group life insurance are always tax-free
63. Carter is a self-employed plumber. Financially, he has had some good years, but
recently, new construction activity has slowed down, and it has negatively affected his
business. One of his worries regarding his life insurance policies is the possibility that his
creditors could seize the insurance money.
Carter is the policyholder and life Insured, which of the following polices present the risk
of the benefit being seized by creditors?
a. with Carter’s grandson as a revocable beneficiary
b. with Carters best friend as a revocable beneficiary
c. with Carter’s daughter as a revocable beneficiary
d. Carter's favorite charitable organization as an irrevocable beneficiary

64. Sylvia, who is 50 years old, owns a life insurance policy which she purchased when she
was 32-years old. She missed the premium payments for two consecutive months and
her policy lapsed three months health has declined since policy issue and is hence
unsure if she should reinstate her policy or purchase a new one. Which of the following
recommendations would you provide?
a) Sylvia should reinstate her policy as she will not be required to provide evidence of
insurability
b) Sylvia should reinstate her policy as her premiums will be based on her age at the time
of policy issue
c) Sylvia should purchase a new policy as there are many upgraded products available that
might be more suitable for her
d) Slyvia should purchase a new policy as the advantages of purchasing a new policy
outweigh reinstating an existing policy

65. Leyla meets with an insurance agent to purchase a life insurance policy. As part of the
life insurance needs analysis, the agent prepares the following list of assets owned by
Leyla:
Money market fund - $30,000
Jewelry - $30,000
Loan deposit that matures in two years - $50,000
…deposit that matures in six months - $40,000
Additional RRSP - $31,000
…. - $20,000
In the list, what is the total value of Leyla's liquid assets?
a) $120,000
b) $70,000
c) …….
d) ……
66. Adeline has decided to leave her employer to launch her own business. She was a
member of her employer’s group life insurance plan. Going forward, she would like to
maintain life insurance coverage. deadline has been in full remission from cancer for a
little over a year now. She is debating between applying for a new individual life
insurance contract or converting her group insurance into an individual life insurance
coverage.
Might Adeline favor the conversion option over applying for a new policy?
a) Her health issues will prevent her from qualifying for a new insurance contract
b) A converted policy offers lower premiums than a similar new life insurance contract.
c) She can select any amount of coverage she wants on a converted policy
d) She will have more options to choose from on a converted policy than on a new life
insurance contract

67. Among the following individuals who do not have their permanent residency status,
who is less likely to qualify for life insurance based on non-medical factors?
a) Zayn, who works as an electrician
b) Amber who works as an engineer for a Montreal-based firm
c) Deor, an international student
d) Lili, who works as a nanny.

68. Ximena was working as a Right attendant when she purchased a life insurance policy on
her life five years ago. Due to the risky nature of the job, her policy was rated with high
premiums. She recently quit her job and is now working as an administrator at an
organization. She is concerned about her policy's high premiums and would like to have
them reduced. Which of the following statements about reducing her premium Is true?
a) The only option for Ximena to pay less on premiums is to apply for a new policy to
replace the existing one.
b) The insurance company can remove the rating, but her premiums cannot be reduced as
her policy has been in force for more than a year:
c) The insurance company cannot modify the risk rating of a policy after it has been issued.
Hence, Ximena's premiums cannot be reduced.
d) The insurance company can remove the rating and reduce her premiums as the reason
for the rating no longer exists.

69. Emma is 90-years-old and she owns a $500,000 Tem-100(T-100) life insurance policy on
her life in which her daughter Ava is the designated beneficiary Ava wants to know
happens to the policy after Emma turns 100. Which of the following is the LEAST likely
outcome?
a) The coverage will continue until Emmas dach
b) The policy expels and the premiums will be refunded
c) Emma will not be required to pay premium amore
d) Ava will the $500.000 a

70. Bobby is an architect who has never owned an insurance policy. After the birth of his
daughter, he wishes to buy a permanent life insurance policy on his life. His primary
motive is to secure his daughter’s future and not investment. He meets an insurance
agent to purchase a UL insurance policy because his friend purchased one recently.
Which of the following disadvantages of a UL policy should the agent let Bobby know?
a) Though the product is simple to understand, it is not as flexible as the other products.
b) He will have to actively monitor the performance of the investment account
c) The premiums are likely to increase overtime regardless of the policy account Value
d) He will not be able add new beneficiaries to his policy

71. Francis and Andrea own 50% shares each of SS Renovations which has a total of 200
shares They have implemented a buy-sell agreement structured as a share-redemption
plan, funded by insurance owned by the company. Which of the following statements
about this arrangement is true?
a) If a shareholder dies, his insurance proceeds will be paid to the surviving Shareholder
b) If either Francis or Andrea dies, their insurance proceeds will be paid to the company
c) If a shareholder dies, the surviving shareholder will pay the other shareholes estate
for his 100 shares with a promissory note.
d) Francis and Andrea are responsible for paying their insurance premiums hough the
ccompany

72. Vanessa wishes to apply for a life insurance policy on her life and she completes her life
insurance application with the help of her agent Cecilia. Vanessa informs Cecilia that she
needs temporary insurance coverage while the application is being underwritten. Cecilia
mentions a few requirements that must be met to qualify for a temporary insurance
agreement (TIA), Which of the following requirements is Cecilia to mention?
a) Vanessa must submit a completed life insurance application along with the first month’s
premium.
b) Vanessa must meet the age restrictions specified for a TIA by the insurer
c) The amount of life insurance coverage requested by Vanessa should be less than
$500,000
d) Vanessa must be able to answer “No to a short list of health-related questions
 73. Fabian owns a family cottage worth $500,000 by the lake which he intends to pass on to
his son, Cameron, after his death. He has two other children, Sadie and Adam, and is
concerned they might think he is biased. When he mentions his predicament, his
insurance agent recommends insurance for estate equalization. Which of the following
is the most appropriate recommendation for estate equalization?
a) Purchase a $500,000 life insurance policy on Cameron’s life, naming Sadle as the
irrevocable beneficiary and Adam as the contingent beneficiary
b) Purchase two 10-year term insurance policies on Fabian’s life, each offering coverage of
$500,000, with Sadie and Adam named as beneficiaries
c) Purchase a $1.500,000 life insurance policy on Fabian’s life, naming Sade and Adam as
primary beneficiaries and Cameron as the contingent beneficiary
d) Purchase a $1,000,000 life insurance policy on Fabian’s life, naming Sadie and Adam
As equal beneficiaries.

74. Which of the following dividend options will not have any effect on the death benefit or
Cash surrender value of a participating whole life policy?
a) Accumulation and paid-up additions
b) Cash and premium reduction
c) Paid-up additions and term insurance
d) Premium reduction and accumulation

75. Based on her life insurance agent’s advice, Margaret has replaced her existing term life
insurance just before its renewal with new term insurance. The coverage of the new
policy is the same and the premium is lower than what it would have been if she had
renewed her first policy.
In addition to the Life Insurance Replacement Declaration (LIRD), Margaret’s life insurance
agent gave her a written explanation specifying the reasons behind her policy replacement. The
agent included that the new policy will cost Margaret less and that the new policy is
contestable for the first two years in the event of material misrepresentation.
What other information needs to be included in the written explanation that accompanies the
Life Insurance Replacement Declaration form?
a) The new policy’s renewal rates
b) Margareta bank information for premium payment

76. Asvika, a senior executive, has a life insurance policy on her own life as well as a policy
on the life of her husband, Dev. Dev stays at home to take care of the children and
 Asvika purchased a policy on his life because she knew that she will have to pay for
childcare costs if Dev dies. She is worried about policies lapsing in the event that she is
not able to pay the premiums. She has a waiver of premium on the policy on her own
life. How can she cover the premiums on Dev’s policy in the event that she becomes
disabled?
a) She has to replace Dev’s existing life insurance policy with a limited payment policy
b) She has to purchase a waiver of premium on Dev
c) The waiver of premium benefit on the policy on Asvika’s Life will cover the premiums of
both policies
d) She has to purchase a payor waiver benefit for the policy on Dev’s life.

77. Salman is a permanent resident in Canada who immigrated six months ago along with
his wife as a dependant. He is in good health and is currently employed as an engineer.
He wishes to apply for a life insurance policy and would like to know if he is eligible.
Which of the following is a requirement for Salman to qualify for life insurance?
a) He might be required to provide detailed blood work and a medical exam
b) He can only apply for a maximum of $500,000 in coverage as a new immigrant
c) He can apply for life insurance after completing at least one year of residency in Canada
d) He will have to provide a copy of his work permit to qualify for coverage

78. Aftab, a life insurance agent, is helping his client, Kelsi, complete an application for a UL
policy. This is Kelsi’s first life insurance application. In addition to the application, what
document will Aftab have to submit to the insurer?
a) A copy of the policy’s illustration with Kelsi’s signature
b) Kelsi’s birth certificate
c) Life insurance replacement declaration form
d) A copy of a doctor’s report on Kelsi’s health

79. Manon has a participating life insurance policy with a CSV of $40,000 and an ACB of
$12,000. His marginal tax rate is 48%.
He decides to surrender his policy and use the proceeds as a down payment on a condo.
Calculate the after-tax amount Manon will have available for the down payment.
a) $25,440
b) $26,560
c) $20,800
d) $20.200
 80. Feyisa has maximized her self-directed RRSP and TFSA and still has considerable
disposable income that she wants to invest in a tax-efficient manner. Currently, her
main insurance need is her mortgage balance which is scheduled to be fully repaid in 15
years, just before she retires. Because the interest rate on her mortgage is 3%, she
prefers to invest her disposable income because she is confident she can get a better
return on her investments than the interest cost on her mortgage.
Feyisa has a high-risk tolerance, a good understanding of the stock markets, and is looking for
high growth investments. While she understands the need for life insurance to cover her
mortgage, her priority is to rapidly maximize her tax-sheltered investment available with a life
insurance policy. She plans to use the accumulated cash value to complement her other sources
of retirement income.
Which life insurance policy is the best fit for Feyisa? VONZ5FXdV MkyNzk322090
a) 20 year termurance

81. Which of the following scenarios represents an insured retirement strategy?

a) Oliver’s assignation of his whole life insurance policy with a CSV of $203,000 as a
collateral to obtain a loan from a third-party to meet his retirement needs
b) Lorenzo’s use of his whole life insurance policy’s CSV to purchase a life annaty that will
provide him with retirement income
c) Martin’s partial surrender of his UL policy after retirement as he feels he does not need
as much coverage as he needed before
d) Kody’s collateralization of his UL policy’s CSV and thereby receiving a loan of $10,000
each year without reporting a taxable income

82. Harper has a UL policy in which she pays a higher premium than the minimum premium
In regard to her investments, Harper is very risk averse; under no circumstances does
she accept that her investment value account decreases.
Which investment options would respect her investment risk tolerance?
a) A Canadian equity index fund and daily interest account
b) Bond index fund and mutual fund account
c) Daily interest account and guaranteed investment accounts
d) Bond Index fund and daily interest account
 83. Berk is applying for a participating whole life policy and he is not sure which dividend
payment option to choose. After gathering information from his insurance agent, he
shortlists paid-up additions (PUA) and term insurance option. He requests the agent to
provide a clear distinction between the options so that he can select one that suits him
best. The agent is likely to say that, unlike PUA, term insurance option:
a) increases the death benefit temporarily
b) takes into account the attained age of the life insured
c) requires medical evidence of insurability
d) Increases both the CSV and the death benefit

84. For which of the following insurance needs would term insurance be considered
Appropriate?
a) Creating a legacy for grandchildren and paying income taxes incurred upon death
b) Creating a legacy for grandchildren and covering childcare services for children
c) Covering childcare services for children and replacing income until a spouse reaches
The age of retirement
d) Paying income taxes incurred upon death and replacing income until a spouse reaches
the age of retirement

85. Steven, age 35, has a mortgage with a remaining amortization of 17 years. He wants to
buy life insurance coverage to ensure there is enough money to repay his debt in the
event of his death. Steven is looking for the most affordable option to cover his need. He
also does not want his policy premiums to ever increase.
Which policy will best meet Steven’s needs?
a) Whole life policy payable for life
b) Renewable T-10 policy
c) Renewable T-20 policy
d) Non-renewable T-20 policy

86. Zed had a personal life insurance policy and was also covered under his employer’s
group plan. Zed died a few days ago. A claim on Zed’s personal policy has been
submitted to his insurer as well as to the insurer of the group plan.
While there are similarities in the claims process for the individual life policy and the
group Plan, what information will be specifically requested by the group plan’s claim
examiner and NOT by the individual policy’s claim examiner?
 a) Proof that the claimant is the beneficiary
b) Proof that Zed was still employed
c) Proof of Zed’s residency status
d) Proof of death

87. (Q-29) Kesia, a single parent, has two daughters aged 4 and 6. Kesia indicates that she
has the following needs that must be covered by life insurance:
 Mortgage outstanding of $200,000
 Children’s education need of $100,000
 Coverage to provide for children’s dependency period
 Taxes to be paid upon her death (estimated at $150,000)
 Funeral expenses of $20,000
For which of the needs will Kesia need to obtain permanent insurance coverage?
a) Coverage to provide for her children’s dependency period, the taxes to be paid upon her
death (estimated at $150,000), and her estimated funeral expenses of $20,00
b) Her outstanding mortgage of $200.000 and her children’s eduication need of 00.000

88. While they have similar outcomes, cross-purchase buy-sell agreements and share
redemption buy-sell agreements also have some differences. XYZ Company is
incorporated as a corporation. There are four shareholders and each of them owns 25%
of the shares (50 shares each). The shareholders are considering both types of buy-sell
agreements.
If one shareholder dies, which of the following elements represents a difference in
outcomes between the two types of buy-sell agreements?
a) Number of shares outstanding
b) The corporation becoming a general partnership
c) Amount the deceased shareholder’s estate will receive
d) Surviving shareholders interest in the company

90. Ximena was working as a flight attendant when she purchased a life insurance policy on her life five
years ago. Due to the risky nature of the job, her policy was rated with high premiums. She recently quit
her job and is now working as an administrator at an organization. She is concerned about her policy's
high premiums and would like to have them reduced. Which of the following statements about reducing
her premium Is true?
a. The only option for Ximena to pay less on premiums is to apply for a new policy to replace the existing
one.

b. The insurance company can remove the rating, but her premiums cannot be reduced as her policy
has been in force for more than a year:

c. The insurance company cannot modify the risk rating of a policy after it has been issued. Hence,
Ximena's premiums cannot be reduced.

d. The insurance company can remove the rating and reduce her premiums as the reason for the
rating no longer exists.

91. Brittany recently married Osbert. She would like to increase the premiums on her UL policy to
accumulate more in the policy's investment fund. Brittany also wants to replace her parents as the
primary beneficiaries of the policy with Osbert. Since she has stopped smoking for a little more than a
year now, she wants her smoker status to be changed to non-smoker. Brittany and Osbert plan to have
children so they left their apartment and bought a house.

Which of the following changes that must be made to Brittany's UL policy will require underwriting?

a. Change of premiums

b. Change of beneficiary

c. Change of smoking status

d. Change of address

92. Abbas owned a $400,000 whole life policy for which he was the life insured and his wife the
beneficiary. When the policy had a CSV of $105,000, he took a policy loan of $60,000 to purchase a car,
and the loan’s interest rate was 4%, compounded annually. Three years later, he died. At the time of this
death, the CV had increased to $120,000 and he had not made any payments on the loan. How much
death benefit will be paid to his wife?

a. $460,000 minus accrued interest

b. $340,000 minus accrued interest

c. $400,000 minus accrued interest

d. $520,000 minus accrued interest

93. Dominic owns a recruitment consultancy, ABC Corp., which is a Canadian-controlled private
corporation (CCPC). If Dominic dies, he will be deemed to have disposed of his shares in the business for
its fair market value, and therefore, he anticipates a taxable capital gain of over $500,000 triggered
upon his death. Being a CCPC, the capital gain arising from Dominic's death will be sheltered by:

a. MTAR.

b. LIRD

c. LCGE

d. NAAR.

94. Anita is 51 years old and is planning to apply for a life insurance policy. She contacts Bella, an
insurance agent, and schedules a meeting. During the meeting, Anita informs Bella that she was
diagnosed with a heart problem a few years ago and is receiving treatment. Considering her health
status, Anita is anxious and asks Bella about additional requirements for applying for a life insurance
policy. Which of the allowing responses is Bella likely to provide Anita?

a. Anita will only be required to provide an APS as she was already diagnosed with the condition and is
receiving treatment.

b. Anita will either be required to provide an APS or a medical exam, but not both, as both serve the
same purpose.

c. Anita will be required to provide an APS as well as a medical exam if the underwriter has concerns
about her health.

d. Anita will only be required to provide a medical exam and not an APS as it only provides a summary of
the life insured's medical history.

95. Through his employer, Joshua has dental insurance coverage with a co-insurance plan. Joshua must
pay 20% of his dental care costs and his insurance coverage will pay the other 80%. Which risk
management strategies are applied for in Joshuas dental care costs?

a. Risk reduction and risk retention

b. Risk retention and risk transfer

c. Risk avoidance and risk reduction

d. Risk avoidance and risk transfer

96. Assuming the policyholder is also the life insured, in which of the following situations will the claims
examiner most likely request a copy of the probated will of the deceased life insured?

a. The primary beneficiary on the life insurance policy is dead and a charitable organization is the
contingent beneficiary on the policy.

b. The primary beneficiary on the life insurance policy is an individual other than an immediate family
member of the life insured.

c. The primary beneficiary on the life insurance policy is dead and there is a successor policyholder.

d. The primary beneficiary on the life insurance policy is dead and there is no contingent beneficiary.

97. Francis and Andrea own 50% shares each of SS Renovations which has a total of 200 shares. They
have implemented a buy-sell agreement structured as a share-redemption plan, funded by insurance
owned by the company. Which of the following statements about this arrangement is true?

a. If a shareholder dies, his insurance proceeds will be paid to the surviving shareholder.

b. Francis and Andrea are responsible for paying their insurance premiums through the company.

c. If either Francis or Andrea dies, their insurance proceeds will be paid to the company.

d. If a shareholder dies, the surviving shareholder will pay the other shareholder's estate for his 100
shares with a promissory note.

98. Roy is 70 years old and is receiving a monthly pension of $1,100 from his defined benefit pension
plan. His wife, Tamara, is dependent on him financially and Roy wants to ensure that she is financially
secure after his death. He would like to know the minimum pension amount payable to Tamara upon his
death to plan her needs accordingly. Which of the following reflects the minimum survivor benefit
payable to Tamara?

a. $550

b. $770

c. $660

d. $825

99. Asvika, a senior executive, has a life insurance policy on her own life as well as a policy on the life of
her husband, Dev. Dev stays at home to take care of the children and Asvika purchased a policy on his
life because she knew that she will have to pay for childcare costs if Dev dies. She is worried about
policies lapsing in the event that she is not able to pay the premiums. She has a waiver of premium on
the policy on her own life. How can she cover the premiums on Dev's policy in the event that she
becomes disabled?

a. She has to purchase a payor waiver benefit for the policy on Devs life.

b. The waiver of premium benefit on the policy on Asvika's life will cover the premiums of both policies.

c. She has to replace Devs existing life insurance policy with a limited payment policy.

d. She has to purchase a waiver of premium on Dev.

100. Ebony wants to purchase an insurance policy as she has a high likelihood of developing heart
disease based on her family history. After analyzing her needs, her agent realizes that Ebony would also
benefit from coverage for critical illnesses. Them agent recommends a 20-year term insurance policy
with a critical illness rider based on Ebony's affordability. Which of the following is an advantage of
adding a critical illness rider to Ebony's insurance policy?

a. Ebony will be able to renew her term insurance policy along with the rider without showing evidence
of insurability.

b. The exclusions and limitations of a critical illness rider are fewer compared to a stand-alone critical
illness insurance policy.

c. Adding a critical illness coverage via a rider to a life insurance policy is more cost-effective as only
one policy fee will be charged.

d. Coverage offered via a critical illness rider can be extended even after the base policy expires.

101. Wesley and Esther are homeowners. Their mortgage balance is $225,000 and their monthly
mortgage payments are $1,500. Wesley does all of the maintenance around the house: lawn mowing,
landscaping, snow removal, painting, and small repairs when required. If Wesley dies, Esther wants to
be able to keep the house for 20 years. While she would continue to work, her income would only be
sufficient to cover the annual property taxes and the utilities for the house. Esther would not be able to
afford the mortgage payments, and she would not do the home maintenance that Wesley does.

What should the insurance on Wesley's life be able to cover at a minimum to permit Esther to keep the
house?

a. Payment of the mortgage loan balance, the monthly mortgage payments for the remainder of the
loan amortization, and the annual costs of house maintenance for 20 years

b. Repayment of the mortgage loan balance and the annual costs of house maintenance for 20 years
c. Monthly mortgage payments for the remainder of the loan amortization

d. Repayment of the mortgage loan balance

102. After his agent delivers his UL policy, Paul wants to know whether there will be any difference in
premiums if he decides to pay premiums annually instead of monthly. Paul also wants to know whether
there is any advantage of paying premiums annually, as he plans to minimally fund his policy.

Which of the following statements is correct?

a. There is no modal factor for UL policies but paying his policy annually will increase his cash value.

b. There is no modal factor for UL policies and, therefore, he will not save by paying premiums annually.

c. There is a modal factor used for UL policies that will increase his overall premium if he pays the
premium annually.

d. There is a modal factor used for UL policies that will reduce his overall premium if he pays the
premium annually.

103. Fernando owns a UL policy and his investment account is performing well with high returns. He
wants to know about the ways of maintaining his policy's exempt status due to the higher-than-
expected returns. He meets with his insurance agent for suggestions. His agent informs Fernando that
the insurance company will ensure that the policy remains exempt by implementing certain changes.
These changes Include all of the following, EXCEPT:

a. withdrawing premiums

b. moving funds to a shuttle account.

c. registering a separate account.

d. increasing the face amount.

104. Asim is 30-years-old and is getting married soon. He was promoted recently with an increase in
salary and wants to start investing and is exploring options. He informs his agent about his needs and
asks the agent to recommend a suitable life insurance product where he can invest and have coverage
increased in the future as needs arise. He prefers to have coverage for life and is willing to pay the
required premiums. The agent recommends a UL policy to Asim. Which of the following statements
justifies the agent's recommendation?
a. A UL policy provides guaranteed policy dividends which will increase coverage.

b. A UL policy's face amount can be increased without showing evidence of insurability.

c. A UL policy offers more flexibility with regard to investments made within the policy.

d. A UL policy allows addition of new beneficiaries without evidence of insurability.

105. Davis, a new agent, is going to deliver his first policy as a life insurance representative. He asks you
what he must do to complete the delivery process. What do you tell Davis?

a. Deliver the policy personally or by mail and obtain a premium for the insurance.

b. Complete the medical questionnaire. Obtain a premium for the insurance and confirmation of
delivery receipt from the client.

c. Complete the agent's comments section. Obtain a premium for the insurance, declaration of
insurability, and confirmation of delivery receipt from the client.

d. Meet the client and obtain the premium for the insurance, declaration of insurability, and
confirmation of delivery receipt from the client.

106. Dexter is in his late 30s and he owns a restaurant. He purchased a house last year with a mortgage
of $300,000 which he has to repay in twenty years. He would like to pass on the restaurant and the
house to his son. If Dexter dies, the tax liability arising from his death is estimated to be $500,000. He
asks his insurance agent to recommend a suitable product to cover his insurance needs in a cost-
effective way. Which of the following is an appropriate recommendation?

a. A $500,000 whole life insurance policy and a 20-year $300,000 term insurance policy

b. An $800,000 whole life insurance policy

c. A $500,000 whole life insurance policy with a 20-year $300,000 term insurance rider

d. An $800,000 20-year term insurance policy

107. When it comes to determining the amount of life insurance required with the income replacement
approach, an increase in which of the following will result in a lower insurance amount?

a. Income tax rate

b. Amount of income that must be replaced

c. Inflation

d. Return on investment

108. Luis is newly employed at a company that offers group insurance to its eligible employees. Luis will
be enrolled into the plan automatically upon completing probation. Which of the following will Luis
receive upon joining the plan?

a. A copy of the master contract

b. A benefit booklet

c. A policy illustration

d. An information folder

109. Phillip is married and hat two children. He is an account executive who earns a gross monthly
income of $7,000. He pays $340 towards CPP, $160 towards employment insurance (El), and $2,100
towards tax. He plans to purchase a life insurance policy on his life. In order for Philip's family to
maintain their current lifestyle after his death, what monthly amount should his life insurance needs
analysis be based on?

a. $9,600

b. $7.000

C. $4,400

d. $4,900

110. Ric and Alicia are a married couple in their early 50s. They purchased a house together 10 years ago
and jointly own a clothing store in the city. They wish to pass on the house and the business to their
daughter, Gia. However, they are worried about the income tax liability that would. arise upon their
death. They meet with an insurance agent to purchase a life insurance policy that meets their specific
needs. Which of the following life insurance products would be an appropriate recommendation?

a. A joint last-to-die permanent life insurance policy on both their lives

b. A 20-year term insurance policy on both their lives

c. A 30-year term insurance policy on both their lives

d. A joint first-to-die permanent life insurance policy on both their lives

111. Easton is the lead programmer in a video game design company and is quite skilled.
Company management estimates that he is responsible for 50% of their annual revenues.
Easton has significant student debt to repay and recently purchased a condo by taking a
mortgage loan.
Among the reason why Easton’s employer should consider buying key person insurance on
Easton’s life, which one does NOT apply?

a. Covering overhead expense until the company gets back on its feet.
b. Making up for lost revenue
c. Repay Easton’s debts
d. Recruiting and training a replacement

112. Aiden, Levi, and Holt are shareholders of DIG inc. Aiden owns 200 shares of the
company, and Levi and Holt each own 100 shares. They have a buy-sell agreement setting
out the terms of the share purchase that will occur should one of them die. The agreement
stipulates that the shares will be bought at a value of $4,000 per share. The surviving
shareholders will each buy an equal part (50% each) of the deceased shareholder’s shares
from his estate. Aiden, Levi, and Holt decided to use criss-cross insurance to fund the share
purchase set out in their buy-sell agreement.
How much life insurance coverage must Levi buy?

a. $200,000 on Aiden; $400,000 on Holt

b. $400,000 on Aiden; $200,000 on Holt
c. $400,000 on Aiden; $800,000 on Holt
d. $800,000 on Aiden; $400,000 on Holt

113. Tristan purchased a participating whole life policy. He wants life insurance to cover his final
expenses as well as the income taxes that will result from a capital gain on the property he
owns by the lake. His income fluctuates and some years he has trouble paying his bills. Which
dividend payment option would be most useful for his if he wants to make sure his policy does
not lapse?
 a. Term conversion
b. Payor Waiver
c. Cash
d. Premium reduction

114. Sylvia applied for a $1,000,000 life insurance policy on her life. Her job involves frequent
travel and she wanted to make sure her children's lives are stare in case she dies prematurely.
Sylvia paid the first premium upon policy delivery and a couple of days later notices an
exclusion clause that denies death benefit If she dies while traveling. Sylvia is disappointed and
decides to return the policy for cancellation. Which of the following is true with regard to Sylvial
situation?
a. Sylvia should be able to negotiate with the insurer and have the travel exclusion removed
instead of cancelling the policy.
b. Should keep the policy for a year as she is unlikely to get a refund and then let it lapse
without making further payments.
c. Sylvia can cancel the policy anytime but she is unlikely to get a refund as the policy has
already been approved and delivered.
d. Sylvia should be able to cancel the policy and get a refund if she returns the policy within
10 days after policy issue.

115. Prisha is 44years old and the purchased a renewable 10-year term insurance policy on her
life when she was 35. She is of excellent health and feels the guaranteed renewal rates
mentioned in her policy are a little higher than expected. She meets with her insurance agent to
ask if she should renew her existing policy or purchase a new one. Which of the following
recommendations should the agent provide?
a. Prisha should apt to a new policy as renewing a policy requires medical underwriting
resulting in higher premiums.
b. Prisha should opt for renewal as a new policy will include three-years incontestability period
and suicide clauses.
c. Prisha opt for renewal as premiums for a new policy will be relatively higher as it will be
based on her current age.
d. Prisha should opt for a new policy as its premiums are likely to be lower than that of her
existing policy upon renewal because of her good health.
116. Shawn owns a designing company and the company's most successful projects were
completed by his skilled designer, Ben. Based on Ben's expertise the company's performance,
Shawn was able to obtain a demand loan to expand his business. Shawn is married to Emma
and they have no children. If dies, the ownership of the business will roll over to Emma. Which
of the following issues should be addressed while analyzing Shawn's insurance?
a. Equality for family members and capital gains tax
b. Loss of skills and creditor demands
c. Family interference and creditor demands
d. Capital gains tax and family interference

117. Nazar is serving his notice period as he is soon partnering with his friend to join his
restaurant business. Nazar is covered under his employer's group insurance plan. He wants his
life insurance coverage to continue as he was recently diagnosed with high blood pressure.
Nazar is thinking of purchasing a new life insurance contract instead of using the conversion
option. Why is the conversion option more suitable for Nazar instead of a new individual
insurance contract?
a. Nazar will have access to more riders and supplementary benefits with a converted policy.
b. The conversion option will provide Nazar with coverage of up to $500,000 without evidence
of insurability.
c. The conversion option will be more favorable for Nazar considering his recent health
diagnosis.
d. Nacar will have fewer restrictions and exclusions on a converted policy.

118. Ken is 30 years old and earns an average income. He lives with his 70-year-old mother who
is dependent on him. He wishes to purchase a life insurance policy on his life and name his
mother as the beneficiary. His insurance agent recommends Ken to purchase a 20-year
renewable term insurance policy instead of a permanent insurance policy. Which of the
following statements accurately justifies the agent's recommendation?
a. Ken can extend coverage at the end of the term without an increase in premiums.
b. A term insurance policy accumulates cash that is paid to the policyholder as dividends.
c. Coverage is guaranteed beyond the term of the policy upon renew
d. A term insurance policy is likely to be more affordable to Ken at the moment
119. Winnie applies for a $500,000 whole life insurance policy on her life and is awaiting
approval. She had mentioned a family history of heart disease and her recent visit to the doctor
for experiencing sudden breathlessness in her application. Which of the following is the
underwriter most likely to request while analyzing Winnie's application?
a. An MVR
b. A MIB report
c. AN ACB report
d. An APS

120. Davis, a new agent, is going to deliver his first policy as a life insurance representative. He
asks you what he must do to complete the delivery process.
What do you tell Davis?
a. Complete the medical questionnaire. Obtain a premium for the insurance and
confirmation of delivery receipt from the client.
b. Deliver the policy personally or by mail and obtain a premium for the insurance.
c. Complete the agent's comments section. Obtain a premium for the insurance,
declaration of insurability, and confirmation of delivery receipt from the client
d. Meet the client and obtain the premium for the insurance, declaration of insurability,
and confirmation of delivery receipt from the client

121. Ethan and Joe purchased their dream home two years ago for which they pay a monthly
mortgage of $1,900. The current mortgage balance on the house is $200,000. Most of the
house maintenance and repairs are done by Ethan. If Ethan were to die prematurely, Joe would
like to keep the house for 25 more years. However, Joe's income will not be sufficient for the
mortgage payments and house maintenance which costs approximately $4,800 annually.
What amount of coverage will be needed for Ethan's life for Joe to be able to continue living in
the house?
a. $500,000
b. $300,000
c. $600,000
d. $400,000
122. Daphne is single and in her mid-60s. She does not have any dependents and has enough
savings for her retirement. She wishes to leave a legacy of $100,000 t a charitable organization
upon her death. Based on her agent's recommendation, Daphne decided to purchase a
universal life insurance policy. Which of the following is a suitable option for Daphne that is
least expensive?
a. Indexed death benefit plus cumulative premiums, level cost of insurance
b. Level death benefit, level cost of insurance
c. Indexed death benefit, yearly renewable term insurance
d. Level death benefit plus account value, yearly renewable term insurance

123. Mathis, 35, and Claudia, 26, are married and have an 8-year-old son, Arlo.
When planning for life insurance, the couple indicates that they want to ensure their family
maintains their current lifestyle until their retirement in 30 years. They also want sufficient
insurance coverage to cover the tax burden that will be triggered after the 2nd death. Mathis
and Claudia have a mortgage on their home and a car loan. If Mathis or Claudia were to die
prematurely, they want their debts repaid and also want to leave enough money to cover Arlo's
post-secondary education. The couple also wants enough insurance to cover their final
expenses and create an estate for their son and his future family:
Among Mathis and Claudia's needs and goals, which ones should be addressed with permanent
insurance?
a. Final expenses, Arlo's post-secondary education, and the creation of an estate for Arlo
b. Repayment of their debts and tax burden upon 2nd death
c. Final expenses, tax burden upon 2nd death, and the creation of an estate for Arlo
d. Repayment of their debts, income replacement, and Arlo's post

124. Lian has just received her whole life policy with a guaranteed insurability benefit (GIB)
rider. The face amount of the policy is $300,000. The GIB allows here of 10% of the face amount
every time the option is exercised for the next 20 years at the policy anniversary for a
cumulative increase of $200,000.
Which of the following is true about the GIB rider?
a. If Lian does not exercise her options to increase the benefit by $200,000 over the next
20 years, the period will be extended until she exercises
b. Lian can increase the benefit as provided by the GIB rider and there will be no medical
underwriting for the increase in policy benefit.
 c. If Lian does not exercise her option in any one year, the option will be carried forward
and can be exercised in a subsequent year.
d. If Lian exercises her GIB option, the insurer will underwrite her financially to ensure that
the benefit is commensurate with her income

125.Patricia is employed and is covered under her company's optional group plan. She is
married, financially stable, and is in good health. Patricia is planning to cancel the group
coverage and apply for individual life insurance. She meets with an insurance agent to
understand the benefits of an individual insurance policy over group insurance. Which of the
following statements made by the agent about an individual insurance policy is true?

a. individuals with poor health can get coverage at affordable rates.

b. term can be renewed without proof of insurability.
c. coverage can be customized to the individual needs.
d. premiums will be lower than those paid under a group plan

126. Weston died recently. He was employed and always contributed at the maximum level to
the Canada Pension Plan (CPP). He is survived by his wife Jahia and his four children:
Aria, aged 19, is married and not working.
• Leon, aged 20, works as a carpenter in a construction company.
• Denney, who is 22 years old, is self-employed and has his own financial business.
• Sofia, who is 24 years old, is studying for her master's degree at university and works part-
time in a store.
Which one of his children is eligible for the CPP children's benefits?
a. Sofia
b. Leon
c. Denney
d. Aria

127. Chris and Lara own a house together which currently has a mortgage balance of $430,000.
Their monthly mortgage payment is $2,300. They do not spend much on house maintenance
and repairs as Chris does most of the work himself. If Chris were to die before her, Lara who is
40 years old would like to keep the house until she turns 70. If that is the case, Lara's single
income will not be enough for the mortgage payments and house maintenance costs. Which of
the following should be taken into consideration in determining the amount of coverage
needed for Chris for Lara to be able to keep the house?
a. Mortgage balance and annual house maintenance costs for 30 years
b. Mortgage balance and monthly mortgage payments
c. Mortgage balance, monthly mortgage payments, and annual house maintenance costs for 30
years
d. monthly mortgage payments and annual house maintenance costs for 40 years

128. Darwin and Sandra are equal partners in their law firm. They have purchased an office
building with a $200,000 mortgage for 15 years. Their tax liabilities are estimated to be
$150,000 annually. The business is now worth $2,000,000 and is continuing to increase in value.
Which of the following is the best recommendation for Darwin and Sandra to fund a buy-sell
agreement?
a. Joint term-to-100 insurance policy with a death benefit of $400,000
b. Joint universal life insurance policy with a death benefit of $1,000,000 and a 15-year term
rider of $200,000
c. Joint 10-year renewable and convertible term policy with a death benefit of $2,150,000
d. Joint non-participating whole life policy with a death benefit of $2,000,000 on the lives

129. Fia, who is a recreational hiker has a job that requires her to travel frequently. Last year,
she was involved in a minor collision with another vehicle that had a drunken driver. Fia smokes
but never drinks alcohol. Which of the following will cause Fla to receive a rated policy if she
applies for life insurance?
a. Frequent travel, smoking status
b. Frequent travel, hiking, driving record
c. Frequent travel, hiking, driving record, smoking status
d. Frequent travel, driving record, smoking status.
130. Damian is obtaining a 10-year mortgage of $400,000 to purchase a house. While obtaining
the mortgage, Damian was given the option to apply for creditor insurance and he chooses to
apply. According to CLHIA while Damiana applies for creditor insurance, the lender should let
Damian know that:
a. His premium will be calculated based on his health and financial status.
b. he cannot get a refund for cancellation after receiving the Certificate of Insurance.
c. he has the right to cancel the coverage at any time after policy issue.
d. he will have to add a beneficiary to the insurance proceeds.
131. Allan is planning to quit his job and start his own business. Allan was recently diagnosed
with heart disease for which he is receiving treatment. He is covered under his employer's
group insurance plan and would like his life insurance coverage to continue even after he
resigns. Allan is also thinking of purchasing an individual life insurance contract instead of
converting the group coverage into an individual plan.
Which of the following is a reason why Allan should opt for the conversion option?
a. Allan will have to access to more riders and supplementary benefits with a converted
policy.
b. Allan can obtain coverage of up to $1,000,000 using the conversion option without
providing evidence of insurability.
c. Allans heart disease might prevent him from getting approved for a new insurance
contract.
d. Allan will have fewer restrictions and exclusions on a converted policy.

132. Taran and Maya are equal co-owners of a CarUni Corp. They have a buy-sell agreement
between them. CarUni Corp purchased a life insurance policy on each of their lives and pays the
premiums for the policies. It is the beneficiary of the policies.
Tarun died this month and his shares have transferred to his estate and CarUni Corp is going to
use the proceeds of the life insurance policy to pay for the redemption of Taran's shares. These
shares will the canceled and Maya will own the remaining existing shares, representing a 100%
ownership interest in CarUni Corp.
Which type of buy sell agreement was in place?
a. Cross-purchase agreement
b. Split-dollar arrangement
c. Buy-sell agreement funded by criss-cross insurance
d. Share redemption plan
133. Griffith insurance agent recommends he purchase a UL insurance policy as its varied
investment options suit his needs. He applies for a UL policy and picks an index fund investment
option from the list provided by the insures in this case, the insurance agent should let Griffith
know that:
a. he will be acquiring a legal interest in the securities that make up the index.
b. he will be acquiring a legal interest in the index fund.
c. his investment account can decline in value due to market fluctuations.
d. he will be required to pay taxes on his investment returns