PruLife Reviewer Traditional Insurance Mock Test
1. Both endowment and term life policies
provide that
- 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
- To give details pertaining to non-
forfeiture options
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?
- Absolute assignee
4. A policy where an irrevocable
beneficiary has been designated, the
insured, without the beneficiary's
permission, can
- Discontinue premium payments
5. What are the basic settlement options
- Fixed amount, fixed period, life
income, interest on deposit
6. An insurance company generally has the
right to rescind a life insurance policy if
- Company discovers at any time
that the policy owner was actually
a minor at the time of application
7. Which of the following is the least
important reason for requiring that
insurance agents be licensed?
- To provide additional income to
the government through lice fees
8. In the event that a policy owner elects
the paid-up insurance option
- The premiums cease and
protection continues with a
reduced amount of coverage
9. The company will allow a policy change
from a lower premium to a higher
premium provided the insured
- Presents satisfactory evidence of
insurability
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
- Universal Life
11. Which of the following statements about
"Disability Waiver of Premium Rider" is
false?
- The insured has to die while
disabled
12. In most life insurance applications the
largest amount of information requested
is data which
- Relates to the insurability of the
applicant
13. Paid-Up Additions
- Don't affect the loan or cash value
of the policy
14. The total life coverage of a permanent
basic policy can be greatly increased
through the use of
- A supplement term rider
15. Life insurance companies make use of
the laws of probability in order to
- Estimate future death rates among
members of a given group
16. In the case of renewable term insurance,
the policy owner may
- Renew the coverage based on a
higher premium
17. A man applied for a Ps. 20,000 whole
life policy and paid the full initial
premium to the soliciting agent. The
 PruLife Reviewer Traditional Insurance Mock Test
agent issued a binding receipt. Under
such a receipt, the insurance company
- Immediately provides interim
insurance that remains in effect
until the policy is issued or the
application is declined.
18. Endownment life insurance and term life
insurance are similar in that both plans
- Provide life insurance protection
for only the period of time
specified in the policy contracts
19. An agent who determines a prospect's
complete financial requirements
preparatory to offering him a policy
using the correct selling product
approach knows as
- Total needs selling
20. Name the provision in a permanent life
insurance policy under which premiums
are discontinued, full insurance will be
maintained for a specific period:
- extended term insurance
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?
- Interest option
22. The extent of medical evidence required
is determined by
- The age of the applicant and the
proposed sum to be insured
23. The conversation of a life insurance
policy is dependent on all the following
except
- Pressure selling
24. All of the following are sources of
information to an insurance company
pertaining to the insurability of an
applicant except
- Government tax records
25. If the applicant for life insurance fails to
disclose or misrepresents material fact,
the contract is
- Valid unless the insurer can prove
fraud
26. The settlement options provisions may
provide all of the following except
- Proceeds held by the company,
with interest payable to the
beneficiary on request
27. Non-forfeiture provisions are included in
whole life and endowment policies to
assure the policyowner that certain
minimum policy benefits shall remain
with him even under certain changed
conditions. Non-forfeiture values
guarantee to the policyowner that
- Any guaranteed policy values will
belong to the policy owner even if
premium payments are discounted
28. Purchasing a continuous-premium,
whole life policy rather than a limited
payment, whole life policy gives the
policyowner the advantage of
- More insurance protection for the
same annual premium outlay
29. In certain situations a company may file
interpleader actions with a Court of Law.
This remedy is used to
- Decide conflicting claims on the
same insurance proceeds
30. Which of the following statements is
false?
- Because of its very short duration
the cash value of a yearly
 PruLife Reviewer Traditional Insurance Mock Test
renewable term policy grows very
fast
31. Which of the following does not have a
legitimate insurable interest
- An individual on the life of his
mistress
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
- Riders
33. Which of the following statements
regarding insurance premiums is false?
- Cash is required for all premiums
paid in the grace period
34. A non-forfeiture option would ordinarily
be selected at the time a policyowner
- Discontinues premium payments
for a whole life or endowment
policy
35. If the interest on a policy loan is not paid
at the policy anniversary the insurance
company may
- Increase the present loan by the
interest.
36. Incontestability Clause
- Prevents the company from
denying a claim after the policy
has been in force for 2 years.
37. The insured named a primary and
secondary revocable beneficiary for Ps.
20,000 policy. Which of the following is
correct?
- The insured can add a third
beneficiary at any time.
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
- The face amount adjusted for
misstatement of age.
39. If the interest on a policy loan is not paid
at the policy anniversary the insurance
company may
- Increase the present loan by the
interest.
40. A yearly renewable term life insurance
policy generally specifies that
- Premiums shall increase every
time the policy is renewed.
41. 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
- False
42. 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
- True
43. Anti-selection occurs when persons in
poor health wish to buy insurance
- True
44. 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
- False
45. 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
- True
 PruLife Reviewer Traditional Insurance Mock Test

46. 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
- True
47. In a group insurance it is assumed that
every member of the group insurable,
provided that every member of the group
is working a minimum number of
(usually 50 hours) each week
- False
48. An endowment at age 65 policy with
premium payable for a limited period of
20 years pays the full amount after 20
years
- False
49. In most life insurance applications, the
largest amount of information requested
is data which identifies the applicant
- False
50. A policy is not rendered void by reason
of misstatement of the assured's death
- True