Ok-Life-Accident-and-Health-or-Sickness-Producer Insurance Licensing Oklahoma Life, Accident, and Health or Sickness Producer Exam Free Practice Exam Questions (2025 Updated)

Theguaranteed insurability riderallows the insured, typically younger individuals, to purchase additional life insurance at specified future dates or life events (e.g., marriage, childbirth) without proving insurability, ensuring coverage despite health changes. This is a common rider in life insurance policies (Title 36 O.S. § 4001 et seq.).

Option A: Incorrect. A cost of living rider adjusts the death benefit for inflation, not additional coverage.

Option B: Correct. The guaranteed insurability rider allows additional insurance without insurability proof.

Option C: Incorrect. An impairment rider excludes specific conditions, not related to additional coverage.

Option D: Incorrect. A multiple indemnity rider increases benefits for accidental death, not additional coverage.

Key person insuranceis a life or disability insurance policy purchased by a business to protect against financial loss due to the death or disability of a critical employee or officer (e.g., a CEO or top salesperson). The business is the policyowner and beneficiary, receiving the death benefit or disability payments to offset lost earnings or replacement costs.

Option A: Incorrect. Business continuation life typically refers to buy-sell agreements, not key person coverage.

Option B: Incorrect. Business overhead insurance covers ongoing business expenses during an owner’s disability, not key employees.

Option C: Correct. Key person insurance indemnifies a firm for losses due to a key employee’s death or disability.

Option D: Incorrect. Employee welfare plans focus on employee benefits, not indemnifying the firm for losses.

This question aligns with the Prometric content outline under “Life Products,” which covers business insurance products.

A whole life insurance policy is a type of permanent life insurance that provides coverage for the insured’s entire life, as long as premiums are paid. It typically includes a level premium, a guaranteed death benefit, and a cash value component that accumulates over time. There is no regulatory requirement in Oklahoma or standard insurance practice that mandates a minimum face amount of $1,000 for whole life policies, making this statement incorrect.

Option A: Correct (as the exception). Whole life policies do not require a $1,000 minimum face amount; insurers set minimums based on their underwriting guidelines, often higher.

Option B: Incorrect (describes whole life). Whole life provides lifelong coverage, as per its definition.

Option C: Incorrect (describes whole life). Premiums are typically payable until death or age 100, depending on the policy.

Option D: Incorrect (describes whole life). While whole life provides a death benefit, it also accumulates cash value, but the phrasing “death benefit only” is misleading as it implies no cash value, which is not the exception here.

This question aligns with the Prometric content outline under “Life Products,” which covers the characteristics of whole life insurance.

Afield underwriter, typically an insurance producer, gathers initial information from applicants to assess their insurability and ensure the application is accurate and complete. A main task is ensuring the accuracy and completeness of an individual’s medical information, as this is critical for the insurer’s underwriting decision. Field underwriters do not approve policies or edit reports to guarantee approval; they facilitate the process by providing reliable data.

Option A: Incorrect. Editing reports to ensure approval is unethical and not a field underwriter’s role.

Option B: Incorrect. Approving policies is the role of the insurer’s underwriting department, not the field underwriter.

Option C: Correct. Ensuring accuracy and completeness of medical information is a key task of a field underwriter.

Option D: Incorrect. Obtaining an MIB report is typically done by the insurer, not the field underwriter.

This question aligns with the Prometric content outline under “Underwriting,” which covers the role of field underwriters.

According to IRS guidelines (Publication 502), premiums paid by an individual for personally owneddisability income insurancearenot tax deductibleas medical expenses or otherwise, unlike certain health insurance premiums. However, benefits received from such policies are generally tax-free if the insured paid the premiums with after-tax dollars.

Option A: Correct. Premiums for personally owned disability insurance are not tax deductible.

Option B: Incorrect. Premiums are not deductible for disability income insurance.

Option C: Incorrect. There is no partial deduction for these premiums.

Option D: Incorrect. Tax deferral applies to certain investment products, not disability premiums.

In a group medical plan with an80% coinsurance provisionand no deductible, the insurer pays 80% of covered medical expenses, and the insured pays the remaining 20%. For Laura’s $1,000 medical bill, the insurer covers 80% ($1,000 × 0.80 = $800), and Laura pays 20% ($1,000 × 0.20 = $200). This calculation aligns with standard health insurance cost-sharing provisions in Oklahoma (Title 36 O.S. § 6060.3).

Option A: Incorrect. Laura must pay her coinsurance share, not $0.

Option B: Correct. Laura pays $200 (20% of $1,000).

Option C: Incorrect. $800 is the insurer’s share, not Laura’s.

Option D: Incorrect. Laura does not pay the full $1,000; she pays only her coinsurance portion.

Medicare Part A covers skilled nursing facility (SNF) care for up to100 daysper benefit period, provided the patient meets eligibility criteria (e.g., a prior 3-day hospital stay and need for skilled care). Beyond 100 days, no benefits are provided, as outlined in CMS guidelines and Oklahoma’s Medicare supplement regulations (Title 36 O.S. § 6217).

Option A: Incorrect. 30 days is too short; coverage extends to 100 days.

Option B: Incorrect. 60 days is within the coverage period but not the limit.

Option C: Correct. No benefits are provided beyond 100 days in an SNF.

Option D: Incorrect. 180 days exceeds Medicare’s SNF coverage limit.

Rebatingis the practice of offering or returning part of a commission, premium, or anything of value to an insured as an inducement to purchase an insurance policy. It is prohibited in Oklahoma under the Unfair Trade Practices Act (Title 36 O.S. § 1204) to ensure fair competition and prevent undue influence.

Option A: Incorrect. Coercion involves forcing someone to buy insurance, not offering inducements.

Option B: Incorrect. Defamation is making false statements harming reputation, not related to inducements.

Option C: Correct. Rebating involves giving value to induce a policy purchase.

Option D: Incorrect. Controlled business refers to writing insurance primarily for oneself or close associates, not inducements.

This question falls under the Prometric content outline section on “State Insurance Statutes, Rules, and Regulations,” which covers unfair trade practices.

In Oklahoma, aninsurance produceris the term defined by law for an individual or entity licensed to sell, solicit, or negotiate insurance contracts. This is outlined in the Oklahoma Insurance Code, which requires producers to obtain a license to engage in these activities for life, accident, and health or sickness insurance.

Option A: Incorrect. An insurance adjuster investigates and settles claims, not negotiates the sale of insurance.

Option B: Correct. An insurance producer is the licensed individual who negotiates the sale of insurance, as defined by Oklahoma law.

Option C: Incorrect. An insurance appraiser evaluates property damage for claims, not related to selling insurance.

Option D: Incorrect. An insurance underwriter assesses risk and determines policy issuance, not sells insurance.

This question falls under the Prometric content outline section on “Licensing,” which includes knowledge of licensing requirements and definitions.

TheConsolidated Omnibus Budget Reconciliation Act (COBRA), as regulated under federal law (29 U.S.C. § 1161 et seq.), requires employers with20 or more employeesto offer continuation of group health insurance coverage to employees and their dependents after certain qualifying events (e.g., termination of employment). This applies to private-sector employers and is enforced in Oklahoma.

Option A: Correct. COBRA applies to employers with 20 or more employees.

Option B: Incorrect. 30 employees is not the threshold.

Option C: Incorrect. 31 employees is not the specific requirement.

Option D: Incorrect. 50 employees is unrelated to COBRA’s threshold.

This question aligns with the Prometric content outline under “State Insurance Statutes, Rules, and Regulations,” which covers federal laws like COBRA.

Anendowment policyis a life insurance product that pays the face amount to the insured if they are alive at the end of a specified period (maturity) or to the beneficiary if the insured dies before maturity. It combines life insurance with a savings component, as defined in Oklahoma’s life insurance regulations (Title 36 O.S. § 4002).

Option A: Incorrect. Universal life is flexible permanent insurance, not tied to a specific maturity payout.

Option B: Incorrect. Modified life has lower initial premiums, not a maturity payout feature.

Option C: Correct. An endowment policy pays the face amount at maturity if the insured is alive.

Option D: Incorrect. A juvenile trust is not a life insurance policy type; it’s a financial arrangement.

Therecurrent periods of disability provisionin a disability income policy allows related or recurring disabilities within a specified timeframe (e.g., 6 months) to be treated as a single disability period. This protects the insured from serving multipleelimination periods(the waiting period before benefits begin), ensuring faster benefit payments for recurrent conditions, as per standard disability policy provisions in Oklahoma (Title 36 O.S. § 4405).

Option A: Incorrect. The provision does not reduce premiums; it affects benefit timing.

Option B: Correct. It protects the insured from multiple elimination periods for recurrent disabilities.

Option C: Incorrect. The provision does not impact insurability; it’s a policy feature.

Option D: Incorrect. It does not reduce the disability period; it simplifies benefit access.

Term life insuranceprovides coverage for a specific period (e.g., 10, 20 years) at a lower premium cost than whole life insurance, making it ideal for individuals needing maximum death benefit protection but unable to afford the higher premiums of permanent insurance. Unlike whole life, term life does not accumulate cash value or allow policy loans.

Option A: Incorrect. Borrowing against policy values requires cash value, available in whole life, not term life.

Option B: Incorrect. Cash value accumulation is a feature of whole life, not term life.

Option C: Correct. Term life is appropriate for maximum protection at a lower cost when permanent insurance premiums are unaffordable.

Option D: Incorrect. Term life is not permanent insurance; whole life provides permanent coverage.

This question falls under the Prometric content outline section on “Life Products,” which covers the suitability of term versus whole life insurance.

To become a resident insurance producer or adjuster in Oklahoma, as outlined in Title 36 O.S. § 1435.7 and § 1435.8, an applicant must: be at least 18 years old, be of good personal and business reputation (demonstrating trustworthiness and competency), successfully pass the required licensing examination, and be a resident of Oklahoma or intend to become one. However, there is no specific requirement to have lived in Oklahoma for 6 months or more prior to applying; residency is established by maintaining a principal place of residence or business in the state at the time of application.

Option A: Correct (not a requirement). Living in Oklahoma for 6 months or more is not explicitly required; residency status is sufficient.

Option B: Incorrect (is a requirement). Passing the licensing exam is mandatory.

Option C: Incorrect (is a requirement). Applicants must be at least 18 years old.

Option D: Incorrect (is a requirement). Good personal and business reputation is required.

Ajoint life policy(first-to-die) covers both spouses under a single contract and pays the death benefit upon thefirst spouse’s death, as defined in Oklahoma’s life insurance regulations (Title 36 O.S. § 4002). This is often used for financial protection needs like mortgages.

Option A: Incorrect. “Dual capacity” is not a standard life insurance term.

Option B: Incorrect. Family term covers dependents but is not specific to first-to-die spousal coverage.

Option C: Incorrect. Whole life is a permanent policy type, not inherently joint.

Option D: Correct. A joint life policy pays on the first spouse’s death.

Backdatinga life insurance policy involves setting the policy’s effective date earlier than the current date, often to secure a lower premium based on the insured’s younger age at the earlier date. This requires the policyowner to pay premiums for the backdated period, as permitted under Oklahoma insurance practices (Title 36 O.S. § 4001 et seq.).

Option A: Incorrect. Reinstating a lapsed policy involves restoring coverage after a lapse, not changing the effective date.

Option B: Incorrect. Excluding preexisting conditions applies to health insurance, not backdating life insurance.

Option C: Incorrect. Accepting late premiums relates to the grace period, not backdating.

Option D: Correct. Backdating makes the policy effective on an earlier date.

Aparticipating whole life insurance policyissued by a mutual insurer allows policyholders to receive areturn of divisible surplusin the form of dividends, which reflect the insurer’s excess profits. This is a feature of mutual insurers, as defined in Oklahoma’s regulations (Title 36 O.S. § 4002). Limited pay, continuous premium, and straight whole life policies do not inherently include dividends.

Option A: Incorrect. Limited pay whole life has a shorter premium payment period, not necessarily dividends.

Option B: Correct. A participating whole life policy provides dividends from surplus.

Option C: Incorrect. Continuous premium whole life refers to lifelong premium payments, not dividends.

Option D: Incorrect. Straight whole life is a general term, not specific to dividends.

Aviatical settlementallows a terminally ill insured to sell their life insurance policy to a third party for a lump sum, typically less than the death benefit, to access funds during their lifetime. The primary and most attractive feature for the insured is receiving areduced prepayment of the death benefit, providing immediate cash for medical or personal needs, as regulated in Oklahoma (Title 36 O.S. § 4055.1 et seq.).

Option A: Incorrect. Viatical settlements do not involve discounted premiums; the policy is sold.

Option B: Correct. The reduced prepayment of the death benefit is the main benefit for the insured.

Option C: Incorrect. Policy assignment is a mechanism, not the primary feature.

Option D: Incorrect. Guaranteed renewability is unrelated to viatical settlements.

This question falls under the Prometric content outline section on “Provisions, Options, Exclusions, Riders, Clauses, and Rights,” which covers viatical settlements.

TheUniform Electronic Transactions Act (UETA)is a model law adopted by Oklahoma (codified in Title 12A O.S. § 15-101 et seq.) that governs the use of electronic records and signatures in transactions, including insurance. It allows insurance documents to be stored, delivered, or presented electronically, provided they meet UETA’s requirements for consent, accessibility, and record retention. Oklahoma’s Insurance Code incorporates these standards for electronic transactions in insurance.

Option A: Incorrect. The Uniform Commercial Code (UCC) governs commercial transactions, such as sales of goods, not electronic insurance documents.

Option B: Correct. The Uniform Electronic Transactions Act provides the legal framework for electronic insurance documents in Oklahoma.

Option C: Incorrect. The Oklahoma Insurance Commissioner enforces regulations but does not set the legal standard for electronic transactions.

Option D: Incorrect. The National Association of Insurance Commissioners (NAIC) develops model laws but does not directly govern Oklahoma’s electronic transaction requirements.

This question is part of the Prometric content outline under “State Insurance Statutes, Rules, and Regulations,” which covers Oklahoma’s laws on insurance transactions.