Free Indiana Life & Health Insurance License Exam Practice Test

Sample IN L&H practice questions

Try a few representative questions below. Each includes the correct answer and a short explanation — the same style you'll see in the full practice test.

1. Question 1Life Insurance Policy Provisions

   An Indiana resident, Ms. Smith, has a life insurance policy with a face amount of $500,000. She recently remarried and wishes to change the primary beneficiary to her new spouse. The current primary beneficiary is her adult son. Which of the following actions must Ms. Smith take to legally change the beneficiary designation?

   • A.Complete a change of beneficiary form provided by the insurer and submit it to the company for processing.(Correct)
   • B.The change is automatic upon providing proof of marriage to the insurance company.
   • C.Inform the insurance company verbally of the desired change and have it notarized.
   • D.Submit a written request to the insurance company, signed by both Ms. Smith and her son.

   Explanation

   Life insurance policies require a formal change of beneficiary process. The policyowner must complete a change of beneficiary form, which is then submitted to the insurance company. Once approved and processed by the insurer, the change is effective.

2. Question 2Life Insurance Types

   Mr. Jones purchased a $250,000 term life insurance policy with a 20-year term. He is currently 45 years old. If he dies at age 60, what will be the death benefit paid to his beneficiaries?

   • A.$250,000
   • B.The cash surrender value of the policy.
   • C.The death benefit will be $0, as the policy has expired.(Correct)
   • D.A pro-rated amount based on the number of years paid.

   Explanation

   Term life insurance provides coverage for a specified period (the term). In this case, the term is 20 years. Since Mr. Jones is 60 years old at the end of the 20-year term (45 + 20 = 65, but the term is 20 years, so he's 65 at the end of the term), the policy has expired, and no death benefit will be paid if he dies after the term ends.

3. Question 3Life Insurance Policy Provisions

   A life insurance policy has a suicide clause that states no death benefit will be paid if the insured commits suicide within two years of the policy's issue date. If the insured dies by suicide 18 months after the policy was issued, what is the most likely outcome?

   • A.The beneficiaries will receive a reduced death benefit based on a formula.
   • B.The policy will be cancelled, and all premiums will be forfeited.
   • C.The full death benefit will be paid to the beneficiaries.
   • D.Only the premiums paid to date will be refunded to the beneficiaries.(Correct)

   Explanation

   The suicide clause in life insurance policies typically allows for a refund of premiums paid if the insured dies by suicide within the specified period (usually two years). After this period, suicide is generally covered.

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