Practice Life & Health Test Questions

In the event of a licensed producer's death or disability, a temporary license may be issued to another individual for a period of:

180 days

If Audrey is licensed to sell both life/health and property/casualty insurance, how many hours of continuing education are required every two years?

24

Upon completion of an examination of an insurer, the Oklahoma insurance department must send a written report no later than:

30 days of examination completion

Notice of a hearing involving a producer's misconduct must be made:

5 days in advance of hearing

Which of the following is NOT advertising?

A letter to an existing insured when it does not urge them to increase coverage

Which of the following is NOT true regarding the responsibilities of a producer to insurer under agency law?

A producer receives unlimited authority from the insurer

All of the following activities would be considered misrepresentation, EXCEPT?

A producer states that dividends paid for the past five years were 5%

Which of the following would NOT have an insurable interest in the life that is being insured?

A voter insuring the life of the president

A producer's license can be revoked for any of the following EXCEPT?

Accused of a felony

A unique feature of an insurance contract where one party can benefit more than the other based on the occurrence of an uncertain event is referred to you as

Aleatory contract

An insurer formed under the laws of Switzerland, authorized to do business in the state of Oklahoma, and holding an Oklahoma certificate of authority would be referred to as:

Alien insurer

The life & Health Guaranty Association would cover policies issued by which of the following types of insurers?

Alien insurer

Which of the following policies would be subject to the policy replacement law?

Allowing a whole life policy to lapse to purchase another whole life policy

Which of the following is NOT a risk management technique?

Ascertain the risk

The practice of the Oklahoma life & health guaranty association charging members in order to pay contractual obligations for an insolvent insurer is called?

Assessment

In life insurance the "insurable interest" must exist:

At the time of application only

When must an "Insurable interest" exist in life insurance?

At the time the application is completed

John Madden, the famous football announcer, refuses to fly for fear of being injured in an aircraft accident. Which risk management technique is John using for refusing to fly?

Avoidance

In order for an insurer to transact business in Oklahoma, it must have which of the following?

Certificate of authority

An applicant for insurance who intentionally fails to disclose a material fact is called

Concealment

When one party constructs the contract any other party has no input, it is known as

Contract of adhesion

The Oklahoma Insurance Code places a restriction on the amount of business a producer can write on an annual basis. This type of business restriction is called:

Controlled business

Life insurance is based on attained age at the time of application. Attained age is

Current age

An insurance company incorporated under the laws of the state of Oklahoma would be considered an

Domestic insurer

If an applicant for life insurance lies on the application regarding a material fact, it is called?

Fraud

Under the Oklahoma insurance code, a licensed insurance producer is prohibited from which of the following?

Giving a gift of more than $100 value to a client as an inducement to purchase insurance

Who selects risk for the insurer?

Home office underwriter

Which of the following is a producer's primary responsibility under agency law?

Identify types of risk exposures the prospects face from a financial needs approach

Speculative risk involves all of the following except?

Insurance

The telephone consumer protection act (aka do not call registry) applies to which of the following entities calling consumers at home?

Insurance company representatives

Who is the Oklahoma Insurance Commissioner?

John Doak

Which of the following penalties can the Oklahoma Insurance Department impose?

License revocation

All of the following are elements of an insurable risk EXCEPT?

Loss must be intentional

Disadvantages of replacing an older life insurance policy would include all of he following EXCEPT?

Lower premium due to premiums being based on attained age

Which of the following is true regarding mortality tables?

Mortality tables predict the probability of losses based on the number of deaths in a given year

Which of the following statements is correct regarding Amanda, a licensed producer, who lives in Oklahoma and wants to sell a life insurance policy in Kansas?

Must have an Oklahoma resident license and a Kansas non-resident license

Kent, a licensed producer, is moving to New York with no intention of returning to Oklahoma. What is Kent's responsibility under the Oklahoma Insurance Code?

Notify the Oklahoma Insurance Department of address change within 30 days.

Which of the following is required to become a licensed Oklahoma resident producer?

Pass a licensing exam with a score of 70% or better

The Oklahoma insurance department OID has all of the following authority EXCEPT?

Pass laws relating to insurance

Which of the following would be considered competent to enter into a contract?

Person can find to hospital due to a heart attack.

The portion of the rate which is projected to be paid out in insurance benefits is called

Perspective lost cost

Which of the following is false about a stock insurance company?

Policy owners have voting rights

Which of the following is NOT considered an illegal act for a life producer?

Premium savings offered by the insurer because the premium is bank drafted.

Policy replacement regulations would govern which of the following?

Replacing a whole life policy with a different company

Regarding a replacement transaction, all of the following are duties of the insurance company, EXCEPT?

Report the replacement situation to the life & health guarantee association

Statements made on an application of insurance are considered

Representations

The Oklahoma Life & Health Insurance Guaranty Association:

Requires all authorized insurers in the state be members of the association

If William is a producer and lives in Kansas but travels to Oklahoma to solicit a policy of insurance, William must have a

Resident license for Kansas and a non-resident license for Oklahoma

If an individual decides to accept the risk associated with a loss and not purchase insurance, they are using what risk managing method?

Retaining

John Johnson is in the hospital because of a heart attack. The $1000 deductible John must pay is an example of which risk management technique?

Retention

Which of the following situations is subject to replacement regulations?

Sale of an individual life policy that causes an existing individual life policy to be lapsed

If the Oklahoma Insurance Department suspects a producer is using unfair trade practices the first action taken is to:

Send notice of a hearing

All of the following are essential elements of a legal binding contract, except?

Signatures

Allof the following are E sensual elements of a legal binding contract except

Signatures

All of the following are elements necessary to the formation of a binding legal contract EXCEPT?

Signatures of both parties

All of the following information would be included in a notice of a hearing by the Oklahoma Insurance Department EXCEPT?

State any precedence established by previous such orders

All of the following are true regarding the national association of insurance commissioners (NAIC) EXCEPT?

State mandated organization

An insurer may be examined as often as necessary. Who decides when an exam is necessary?

The insurance commissioner

A life insurance policy is a contract of adhesion. Therefore any ambiguity aka confusion any contract would be in favor of who?

The insured

The law of large numbers states that:

The larger the number of units considered, the more predictable are the losses

Certain elements are necessary for a particular risk to be insurable. Which of the following would make a risk uninsurable?

The risk is of a catastrophic war nuclear nature

Which of the following is the primary source of regulation of the insurance industry?

The state government

All of the following statements are true regarding an actuary except?

They select risk

Which of the following statements is true regarding a producer selling insurance for a fraternal insurer?

To receive a commission, the producer must be licensed and have an insurer appointment

Which type of risk management technique is being used when the insured buys an insurance policy?

Transfer

A person, who gathers information, analyzes exposures, and selects risk for the insurer is called an

Underwriter

Which of the following are sources of regulation of the insurance business EXCEPT?

Unilateral Practice

The Oklahoma life & health guaranty association would protect all of the following policies except?

Variable Annuities

When can a producer share commission with another producer?

When they are both licensed in the same line of business

Which of the following individuals would NOT be considered incompetent?

a convicted felon currently serving time in prison

All of the following are true regarding the insurance code except?

a hearing is held within 30 days after the insurance department receives the demand for a hearing

Under the Oklahoma insurance code, which of the following statements is not correct?

a high school diploma is required to have an insurance producer license

After a hearing, the Oklahoma insurance department can suspend a producer's license for all of the following reasons, EXCEPT?

accused of a felony

Which of the following policies would be subject to the policy replacement law

allowing a whole life policy to lapse to purchase another whole life policy

An insurer licensed to sell insurance in Oklahoma is referred to as:

an admitted insurer

An individual licensed as a life producer would be authorized to perform all of the following except?

bind life insurance coverage

Several producers agree to control the market share of Zbest Mutual Insurance Company, What type of unfair trade practices is this?

boycott

Under the Oklahoma Insurance Code, a temporary producer license:

can be issued to the representative of a deceased or disabled producer for a period of 180 days

A producer's responsibilities include all of the following EXCEPT?

changing provisions in the policy

A legally binding contract requires that each party give something of value to the other; this essential element is called

consideration

The insurance company writes the insurance policy and the insured must comply with the contract terms without negotiation. The courts will interpret any ambiguity in favor of the insured. What is the name of this unique contractual feature?

contract of adhesion

a producer has responsibility to act in the best interest of the insured. This responsibility is known as:

fiduciary obligation

Which of the following would be considered rebating?

giving a new policy owner a portion of your commission

Which of the following statements is NOT true concerning a controlled business under the Oklahoma Insurance Code?

if a producer has obtained a license for the purpose of writing controlled business, the insurance department will invalidate all controlled business

Which of the following is not a disciplinary action that may be taken by the department of insurance against a producer found guilty of an unfair trade practice?

impose a jail sentence of no more than 6 months

If a producer's license is suspended or revoked, the Oklahoma insurance department may do all of the following except?

impose a mandatory 6-month jail term

Which of the following is NOT true regarding insurance?

insurance is a device for handling speculative risk

A mutual insurer

is a participating company owned by policy owners

BlueCross/BlueShield is considered what type of insurer?

medical service organization

A shareholder is to stock insurer as a policy owner is to a

mutual insurer

an insurance company that is owned by the policy owner who receive the company's profits in the form of dividends is an

mutual insurer

A producer who lives in another state is called

non-resident agent

Giving something of value as an illegal inducement for someone to purchase insurance is known as:

rebating

An insurance policy is a contract of adhesion, written by the insurer. If the language is unclear, courts will interpret any ambiguity in favor of:

the insured

The definition of risk is

the potential for loss

If a licensed insurance producer dies, which of the following would be able to receive a temporary producer license?

the surviving spouse

Which of the following is NOT a responsibility the producer has to his/her insured?

to invest insurer's premium

Insurance is considered which type of risk management technique

transfer

Consideration is a trade of value between parties and is a requirement to have a legally binding contract. The insured's consideration in a life insurance contract is:

truthful statements on the application and payment of premium

A producer must notify the oklahoma insurance department within what length of time after changing his/her address?

within 30 days