Georgia Life, Accident & Health Practice Test

Answer choices

1. A. No. Participating whole life policies are prohibited from paying dividends to individual policyowners.
2. B. No. Policy dividends depend on divisible surplus and should not be treated as a guaranteed policy value.
3. C. Yes. Once a participating policy is issued, every illustrated dividend becomes a guaranteed contractual payment.
4. D. Yes. Dividends are fixed by the insured’s age at issue and cannot change with insurer experience.

Wrong-answer review

• A. No. Participating whole life policies are prohibited from paying dividends to individual policyowners.: Incorrect. Participating policies may pay dividends; the key point is that dividends are not guaranteed.
• C. Yes. Once a participating policy is issued, every illustrated dividend becomes a guaranteed contractual payment.: Incorrect. Participating dividends are not guaranteed merely because they were illustrated.
• D. Yes. Dividends are fixed by the insured’s age at issue and cannot change with insurer experience.: Incorrect. Dividend amounts can change and are not fixed solely by issue-age factors.

Answer choices

1. A. Pay an additional death benefit immediately when the insured becomes disabled.
2. B. Convert the policy to a variable annuity and stop the life insurance coverage.
3. C. Waive required policy premiums during a qualifying disability while keeping the underlying life coverage in force, subject to the rider terms.
4. D. Guarantee the right to buy unlimited additional coverage without regard to the rider’s option dates or limits.

Answer choices

1. A. The distribution is taxed at capital-gains rates because an HSA is a securities account.
2. B. The distribution can generally be received tax-free when it is used or reimburses qualifying medical expenses.
3. C. The distribution is always taxed as wages because HSA money belongs to the employer.
4. D. The distribution is tax-free only if the HDHP deductible has already been fully satisfied. Qualified-expense treatment would depend on satisfying the health-plan deductible before any HSA distribution could be excluded from income.

Answer choices

1. A. Fill in the blank from memory after the applicant leaves and submit the application without noting the change.
2. B. Submit the application as complete because the initial premium cures any missing application information.
3. C. Have the applicant complete the missing information before submission rather than guessing, altering, or submitting a knowingly incomplete application.
4. D. Submit the application as received and let underwriting obtain the missing health answer later, since collecting the first premium means the producer should not delay transmission.

Answer choices

1. A. The insurer's identity is relevant only after a claim is filed.
2. B. Life insurance and annuity advertising must identify the insurer clearly enough that the audience is not misled about who issues the contract.
3. C. The insurer's identity may be concealed whenever multiple insurers share an ownership group.
4. D. The insurer's identity may always be omitted if an agency logo is larger than the policy title.

Answer choices

1. A. The producer should backdate the new policy to make the cancellation irrelevant.
2. B. The producer may tell the client to cancel the old policy once the new application and initial premium are submitted, even though the new insurer has not completed underwriting.
3. C. Immediate cancellation is required so the applicant cannot have overlapping life insurance.
4. D. The producer should follow Georgia replacement procedures and avoid encouraging the client to terminate valuable existing coverage before the new coverage is issued and accepted.

Answer choices

1. A. The amount payable is adjusted to the benefit the paid premium would have purchased at the insured’s correct age.
2. B. The beneficiary receives the stated face amount plus an age-misstatement penalty from the insurer.
3. C. The insurer must ignore the error once the policy has been in force for 30 days.
4. D. The policy is automatically void and all premiums are forfeited whenever age is misstated.

Answer choices

1. A. The producer must report the premium for the insurance contract to the insurer or its agent and may not divert premium funds held in a fiduciary capacity.
2. B. The producer may keep any undisclosed amount if the customer agreed verbally.
3. C. The producer only has to report the net amount after subtracting any personal service fee.
4. D. The producer can alter the reported premium after policy delivery without insurer involvement.

Answer choices

1. A. The practice is lawful if the premium difference is disclosed before application.
2. B. Unfair discrimination in insurance based on protected characteristics such as race, color, or national or ethnic origin is prohibited.
3. C. The practice is allowed whenever the insurer files the rates with the Commissioner. Rate filing would authorize distinctions based solely on race or national origin.
4. D. The practice is allowed for life insurance but not accident and sickness insurance.

Answer choices

1. A. Plans C and F are not available to people new to Medicare on or after January 1, 2020 because those plans cover the Part B deductible.
2. B. Plan F became mandatory for all Medicare beneficiaries beginning in 2020.
3. C. Plan F is the only Medigap plan available to people first eligible after 2020.
4. D. Plan F is available only if the applicant also enrolls in Medicare Advantage.