Free Ohio Life and Health Insurance Practice Exam Online

Correct answer: B. A nonparticipating policy does not pay policy dividends to the policyowner

• A: This states the rule for risk classification: Underwriting may classify applicants by risk, such as preferred, standard, substandard, or declined. The question instead asks about nonparticipating policy, which has a different trigger or coverage function.
• C: This states the rule for policyowner rights: The policyowner generally controls rights such as beneficiary changes, assignments, loans, and surrender subject to policy terms. The question instead asks about nonparticipating policy, which has a different trigger or coverage function.
• D: This states the rule for replacement caution: Replacing life insurance requires careful comparison of benefits, costs, contestability, surrender charges, and suitability. The question instead asks about nonparticipating policy, which has a different trigger or coverage function.

Correct answer: B. Level term life keeps the death benefit level during the selected term period and generally does not build cash value

• A: This states the rule for decreasing term life: Decreasing term life uses a death benefit that reduces over time, often matching a shrinking debt need. The question instead asks about level term life, which has a different trigger or coverage function.
• C: This states the rule for whole life insurance: Whole life is permanent life insurance designed for lifetime protection with cash-value features if premiums are paid. The question instead asks about level term life, which has a different trigger or coverage function.
• D: This states the rule for indexed universal life: Indexed universal life credits interest using an index-linked formula subject to policy caps, floors, and participation terms. The question instead asks about level term life, which has a different trigger or coverage function.

Correct answer: B. Decreasing term life uses a death benefit that reduces over time, often matching a shrinking debt need

• A: This states the rule for annual renewable term: Annual renewable term renews for successive one-year periods, usually with premiums increasing as the insured ages. The question instead asks about decreasing term life, which has a different trigger or coverage function.
• C: This states the rule for limited-pay whole life: Limited-pay whole life compresses premium payments into a shorter payment period while coverage can continue for life. The question instead asks about decreasing term life, which has a different trigger or coverage function.
• D: This states the rule for joint life: Joint life commonly insures two people and pays at the first death. The question instead asks about decreasing term life, which has a different trigger or coverage function.

Correct answer: C. Annual renewable term renews for successive one-year periods, usually with premiums increasing as the insured ages

• A: This states the rule for whole life insurance: Whole life is permanent life insurance designed for lifetime protection with cash-value features if premiums are paid. The question instead asks about annual renewable term, which has a different trigger or coverage function.
• B: This states the rule for universal life: Universal life provides flexible premium and adjustable death-benefit features subject to policy limits and sufficient values. The question instead asks about annual renewable term, which has a different trigger or coverage function.
• D: This states the rule for survivorship life: Survivorship life generally pays after the second insured dies. The question instead asks about annual renewable term, which has a different trigger or coverage function.

Correct answer: A. Whole life is permanent life insurance designed for lifetime protection with cash-value features if premiums are paid

• B: This states the rule for limited-pay whole life: Limited-pay whole life compresses premium payments into a shorter payment period while coverage can continue for life. The question instead asks about whole life insurance, which has a different trigger or coverage function.
• C: This states the rule for variable life: Variable life places policy values in separate-account investment options, so the policyowner bears investment risk. The question instead asks about whole life insurance, which has a different trigger or coverage function.
• D: This states the rule for group life: Group life covers eligible members under a master policy, with certificates commonly issued to covered individuals. The question instead asks about whole life insurance, which has a different trigger or coverage function.