Free Life Insurance Basics Practice Questions
Minnesota Life exam — 133 practice questions.
Subtopics: Insurable interest, Risk and protection, Underwriting, Premium factors, Field underwriting, Representations, Consideration, Risk classification, Life line of authority, Business insurable interest, STOLI, Settlement contract restrictions, STOLI remedies, Rejected applications, Insurable interest parties, Personal uses, Liquidity, Human life value, Needs approach, Buy-sell funding, Key person, Term vs permanent, Participating policies, Separate account, Variable products licensing, Mortality, Interest assumption, Premium mode, Advertising, Application accuracy, Sources of underwriting, Substandard risk, Effective date, Statement of good health, Backdating, MIB, Unfair discrimination underwriting, Group vs individual, Warranties vs representations, Disclosure statement, Estate conservation, Executive compensation, Expense factor, Declined risk, Surrender comparison index, Net amount at risk, Legal reserve, CSO mortality table, Level premium funding, Cash value accumulation, Endowment maturity, Free look period, Policy replacement rules, Twisting, Churning, Rebating, Defamation, Binding receipt, Insuring clause, Consideration clause, Owner vs insured, Stranger-originated life insurance, Suitability, Sales illustration, Producer appointment, Paramedical exam, Inspection report, Nonmedical limit, Split-dollar plan, Section 162 executive bonus, Dependency period need, Social Security blackout period, Capital retention approach, Final expense need, Insurance age, Flat extra premium, Postponed risk, Agent's report, Policy summary, Material misrepresentation, Estate creation, Cash accumulation, Charitable giving, Buy-sell cross purchase, Buy-sell entity purchase, Cross purchase count, Key person beneficiary, Deferred compensation, Split dollar collateral assignment, Executive bonus taxation, Business overhead uses, Information for needs analysis, Group vs individual class, Nonparticipating policy, Fixed vs variable, Variable minimum death benefit, Gross vs net premium, Modal factors, Mortality table use, Gender and mortality, Producer delivery duties, Constructive delivery, Rated policy delivery, Conditional receipt insurability, No premium with application, Application signatures, Application corrections, Insurable interest third party, Self insurable interest, Attending physician statement, MIB adverse decisions, MIB pre-notice, HIV testing consent, Underwriting prohibited factor, Rated policy, Standard risk, Prescription database, Social Security fully insured, Currently insured, Survivor benefits children, Spouse caring for child, Blackout period end, Lump-sum death benefit, Full retirement age, Social Security disability, Social Security as offset, Producer report purpose
Read the Life Insurance Basics study guide
Sample questions & answers
1. Under Minnesota's Insurable Interest Act, when must the person who will receive the benefits have an insurable interest in the insured?
When the policy is issued
Minn. Stat. 60A.0783 requires benefits to be payable to the insured, the estate, or a person having an insurable interest at the time the policy is issued.
2. The primary purpose of life insurance is to provide what?
Financial protection against the risk of premature death
Life insurance is designed primarily to provide financial protection against the economic loss caused by premature death.
3. The process an insurer uses to evaluate and classify the risk presented by an applicant is called what?
Underwriting
Underwriting is the process of evaluating an applicant's risk and deciding whether and on what terms to issue coverage.
4. Which set of factors are the primary components used to determine a life insurance premium?
Mortality interest and expenses
Life insurance premiums are based primarily on mortality (expected claims), interest (assumed earnings), and expenses (cost of doing business).
Practice: Life Insurance Basics
Answer choices are shuffled every time, and every question comes with an explanation.
Practice questions are study aids generated for exam preparation and are not actual exam questions. Content is provided for educational purposes and is not legal advice. Verify current statutes, rules, and exam specifications with the Insurance Department and the exam administrator before relying on it.
