Free Types of Life Insurance Policies Study Guide
Virginia Life, Accident & Health exam — Types of Life Insurance Policies.
The national guide covers the kinds of life insurance and how they work. The Virginia questions in this area are about group life (Va. Code 38.2-3317 and following) and variable products. This guide covers both.
Group life
Eligibility
- A group life policy must cover at least 2 persons, not counting spouses or minor children, at issue and at each anniversary (38.2-3322.2).
- A noncontributory policy covers all eligible employees except those who reject it in writing (38.2-3318.1).
- Creditor group coverage can never exceed the greater of the scheduled or actual unpaid debt. Any excess goes to the insured's estate.
- Dependents: a spouse, children under 19, and dependent full-time students under 25, in amounts no greater than the member's own coverage (38.2-3323).
Provisions
- Facility of payment: up to $2,000 to someone who paid funeral or last-illness expenses (38.2-3330).
Conversion
| Situation | Virginia rule |
|---|---|
| Employment ends (38.2-3332) | Apply and pay within 31 days. Choose any form except term, with no evidence of insurability. |
| Group policy or class ends (38.2-3333) | People insured at least 5 years may convert, subject to amount limits. |
| Death during the conversion period (38.2-3334) | The convertible amount is paid as a group claim. |
Variable life and annuities
- Variable contract values are held in separate accounts and rise and fall with investment results (38.2-3113).
- Separate account assets can't be charged with the insurer's other liabilities.
- To sell variable products, a resident agent needs:
- a life and annuities license
- a variable contract agent license, which requires passing the FINRA exam the Commission prescribes (38.2-1815; 14VAC5-20-80)
- The variable license ends immediately if the life and annuities license ends (38.2-1825).
Insurable interest and consent (38.2-301, 38.2-302)
- Insurable interest is needed when the contract is made, not at death.
- Close relatives have an interest based on love and affection.
- A corporate employer has an insurable interest in key employees, and in other employees after 12 consecutive months of employment.
- Buy-sell parties have an insurable interest in each other for the purpose of the agreement.
- The insured must apply or consent in writing. A spouse may insure the other spouse without that.
Common exam traps
- Group life needs at least 2 lives.
- Conversion within 31 days, to any plan but term. When the group ends, conversion needs 5 years of coverage.
- Dependent students are covered under 25. Other children are covered under 19.
- A variable agent needs both a life and annuities license and a variable contract license.
Practice Types of Life Insurance Policies questions All Life, Accident & Health topics
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.
