Professional Documents
Culture Documents
“This material is solely for the information, use and private circulation of Pru Life UK and may not be published, circulated, reproduced or distributed in part or in whole
to any other person without the company’s written prior consent.”
TRADITIONAL LIFE MOCK EXAM - (61 items)
INSTRUCTION: Put an X mark beside the letter of your answer.
Example:
1 . Edward tells you that he wants to be insured for life at the least annual cost until he dies. What would
you offer him?
X a. A whole life policy
b. A 20-pay life policy
c. Endowment policy
d. A term policy
TRADITIONAL
a. No cash value is available to the policy owner during the term of the policy
b. Renewal and conversion privileges are available
c. A benefit will be paid at the end of the period of coverage if the person is then alive
d. Insurance protection will be limited to a specified period
2. Indicate which of the following is not a function of an application for life insurance policy.
3. A father has his present life insurance payable to his estate and because he has now retired, he
wants to pass the policy on to his son who will assume the premium payments. Which of the
following will he have to appoint his son to achieve his desire and protect the son from Estate Tax
Liability?
4. A policy where an irrevocable beneficiary has been designated the insured, without the
beneficiary’s permission, can
DISCLAIMER: The questionnaire and answer key have been prepared for general information purposes only. These documents have not been officially signed-off by
our company’s Compliance Department.
“This material is solely for the information, use and private circulation of Pru Life UK and may not be published, circulated, reproduced or distributed in part or in whole
to any other person without the company’s written prior consent.”
5. What are the basic settlement options?
6. An insurance company generally has the right to rescind a life insurance policy if
a. Company discovers at any time that the policy owner was actually a minor at the time of
application
b. Insured person intentionally kills himself during the suicide exclusion period specified in the
policy
c. Insured person is killed in military action during the contestable period of the policy
d. Company discovers during the contestable period that the application contains a material
statement
7. Which of the following is the least important reason for requiring that insurance agents be
licensed?
8. In the event that a policy owner elects the paid-up insurance option
a. The premiums stop and the policy continues for the full face amount until age 65
b. The insurance continues at a reduced amount and with a reduced premium
c. The policy will automatically terminate
d. The premiums cease and protection continues with a reduced amount of coverage
9. The company will allow a policy change from a higher premium to a lower premium provided the
insured
10. A policy which permits the policyholder to vary the level of premiums, the sum insured and has its
cash values dependent upon the investment performance and the level of premium paid is known
as policy
DISCLAIMER: The questionnaire and answer key have been prepared for general information purposes only. These documents have not been officially signed-off by
our company’s Compliance Department.
“This material is solely for the information, use and private circulation of Pru Life UK and may not be published, circulated, reproduced or distributed in part or in whole
to any other person without the company’s written prior consent.”
11. Which of the following statements about “Disability Waiver of Premium Rider” is false?
12. In most life insurance applications, the largest amount of information requested is data which
14. The total life coverage of a permanent basic policy can be greatly increased through the use of
15. Life insurance companies make use of the laws of probability in order to
16. In the case of renewable term insurance, the policy owner may
17. A man applied for a Ps. 20,000 whole life policy and paid the full initial premium to the soliciting
agent. The agent issued a binding receipt. Under such a receipt, the insurance company
DISCLAIMER: The questionnaire and answer key have been prepared for general information purposes only. These documents have not been officially signed-off by
our company’s Compliance Department.
“This material is solely for the information, use and private circulation of Pru Life UK and may not be published, circulated, reproduced or distributed in part or in whole
to any other person without the company’s written prior consent.”
18. Endowment life insurance and term life insurance are similar in that both plans
19. An agent who determines a prospect’s complete financial requirements preparatory to offering him
a policy using the correct selling approach knows as
a. Counselor selling
b. Total needs selling
c. Planned selling
d. Multiple products selling
20. Name the provision in a permanent life insurance policy under which premiums are discontinued,
full insurance will be maintained for a specified period:
21. Notwithstanding various possible legal impediments, if the owner of an endowment at age 65 policy
tells you that the maturity of the policy he wants to provide his church with a monthly donation for
as long as the church exists. Which option do you recommend?
23. The conservation of a life insurance policy is dependent on all the following except
DISCLAIMER: The questionnaire and answer key have been prepared for general information purposes only. These documents have not been officially signed-off by
our company’s Compliance Department.
“This material is solely for the information, use and private circulation of Pru Life UK and may not be published, circulated, reproduced or distributed in part or in whole
to any other person without the company’s written prior consent.”
24. All of the following are sources of information to an insurance company pertaining to the
insurability of an applicant except
26. The settlement options provision may provide all of the following except:
27. Non-forfeiture provisions are included in whole life and endowment policies to assure the policy
owner that certain minimum policy benefits shall remain with him even under certain changed
conditions. Non-forfeiture values guarantee to the policy owner that
28. Purchasing a continuous-premium, whole life policy rather than a limited payment, whole life policy
gives the policyowner the advantage of
29. In certain situations, a company may file interpleader actions with a Court of Law. This remedy is
used to
DISCLAIMER: The questionnaire and answer key have been prepared for general information purposes only. These documents have not been officially signed-off by
our company’s Compliance Department.
“This material is solely for the information, use and private circulation of Pru Life UK and may not be published, circulated, reproduced or distributed in part or in whole
to any other person without the company’s written prior consent.”
30. Which of the following statement is false?
a. The cash value of a whole life policy builds up at a slower rate than for a 20-year endowment
b. The cash value in a permanent policy is guaranteed by the company
c. The cash value of an endowment builds up faster than that for a limited pay life policy of the
same duration
d. Because of its very short duration the cash value of a yearly renewable term policy grows very
fast
31. Which of the following does not have a legitimate insurable interest?
32. The basic coverage provided by the life insurance policies may be supplemented by a separate
provision that provides coverage for accidental amounts or of a different nature. Collectively these
provisions are known as
a. Riders
b. Deposit privileges
c. Dividends
d. Assignment
35. If the interest on a policy loan is not paid at the policy anniversary the insurance company may
DISCLAIMER: The questionnaire and answer key have been prepared for general information purposes only. These documents have not been officially signed-off by
our company’s Compliance Department.
“This material is solely for the information, use and private circulation of Pru Life UK and may not be published, circulated, reproduced or distributed in part or in whole
to any other person without the company’s written prior consent.”
37. The insured named a primary and secondary revocable beneficiary for Ps. 20,000 policy. Which of
the following is correct?
38. When you bought an insurance policy on your wife’s life, you were 27 and she was 26, but you
stated that you were 26 and she was 27. Five years later your wife died. The insurer will pay
39. If the interest on a policy loan is not paid at the policy anniversary the insurance company may
40. A yearly renewable term life insurance policy generally specifies that
41. The following statements concerning insurable interest are correct, except:
42. One requirement a policyowner must meet in order to reinstate a life insurance policy is to
DISCLAIMER: The questionnaire and answer key have been prepared for general information purposes only. These documents have not been officially signed-off by
our company’s Compliance Department.
“This material is solely for the information, use and private circulation of Pru Life UK and may not be published, circulated, reproduced or distributed in part or in whole
to any other person without the company’s written prior consent.”
43. If the person whose life is insured dies during the grace period and the premiums was not paid, the
amount that the insurance company will pay to the beneficiary is usually the
44. Life insurance guarantees cash benefits for all the following except
a. Mortgage
b. Clean-up fund
c. Family dependency period income
d. Educational fund
45. Under an endowment policy, if the person whose life is insured survives to the end of the period
stated in the policy, the
46. Life insurance contributes directly to the welfare and progress of the country by
47. A yearly renewable term life insurance policy generally specifies that
49. All of the following are Standard Provision of a life insurance policy except
DISCLAIMER: The questionnaire and answer key have been prepared for general information purposes only. These documents have not been officially signed-off by
our company’s Compliance Department.
“This material is solely for the information, use and private circulation of Pru Life UK and may not be published, circulated, reproduced or distributed in part or in whole
to any other person without the company’s written prior consent.”
50. All of the following term policies can be sold as a basic policy contract except
51. A housewife without gainful employment applies for P500,000 life coverage. Which of the following
should the agent do?
52. In a case where the premium has not been paid and the cash values has been exhausted, the
policy can still avail of the grace period.
53. According to the law of large numbers, events which happen seemingly by chance will actually be
bound to follow a predictable pattern, if enough such happenings are observed.
54. Anti-selection occurs when persons in poor health wish to buy insurance.
55. A policy is still in force for the full face amount and will remain in force for a further period of four
years and 118 days, without the payment of any premiums has availed of paid up insurance
option.
56. In the case of misstatement of age, the amount of insurance is adjusted to the amount which the
premium paid at the correct age would have purchased.
57. A policy that provides guaranteed cash values plus extra annual distributions and pays the insured
after a specified time is known as a participating endowment.
58. In a group insurance it is assumed that every member of the group is insurable, provided that
every member of the group is working a minimum number of (usually 50 hours) each week.
59. An endowment at age 65 policy with premium payable for a limited period of 20 years pays the full
amount after 20 years.
60. In most life insurance applications, the largest amount of information requested is data that
identifies the applicant.
61. A policy is not rendered void by reason of misstatement of the assured’s death.
DISCLAIMER: The questionnaire and answer key have been prepared for general information purposes only. These documents have not been officially signed-off by
our company’s Compliance Department.
“This material is solely for the information, use and private circulation of Pru Life UK and may not be published, circulated, reproduced or distributed in part or in whole
to any other person without the company’s written prior consent.”
TRADITIONAL LIFE ANSWER KEY
1. D
2. A 34. D
3. B 35. D
4. B 36. D
5. C 37. B
6. A 38. C
7. D 39. A
8. D 40. B
9. B 41. D
10. C 42. D
11. B 43. A
12. C 44. D
13. C 45. A
14. C 46. D
15. A 47. A
16. A 48. A
17. D 49. B
18. C 50. A
19. A 51. B
20. A
21. C
22. A TRUE OR FALSE
23. C 52. F
24. D 53. T
25. D 54. T
26. D 55. F
27. B 56. T
28. C 57. T
29. C 58. F
30. D 59. F
31. A 60. F
32. A 61. T
33. A
DISCLAIMER: The questionnaire and answer key have been prepared for general information purposes only. These documents have not been officially signed-off by
our company’s Compliance Department.
“This material is solely for the information, use and private circulation of Pru Life UK and may not be published, circulated, reproduced or distributed in part or in whole
to any other person without the company’s written prior consent.”