Free practice test
Twelve life insurance exam questions. Right now, free.
These twelve questions are ours, written to the shared core every state's exam outline covers, with instant scoring and the explanation behind every answer. We sell study materials and practice exams for the life insurance licensing exam in 49 states plus the District of Columbia. Most states pass at a score of 70. About 57 percent of first-time life exam takers pass nationally (NAIC, 2025 results).
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Question 1 of 12
An insurance company formed under the laws of the state in which it is doing business is called what in that state?
Question 2 of 12
Robert has no dependents but wants to cover his final expenses and a small charitable gift; which method most directly supports this planning?
Question 3 of 12
Under the misstatement of age provision, what happens if an insured understated his age on the application?
Question 4 of 12
An applicant intentionally hides a known serious heart condition on the application. This is best described as what?
Question 5 of 12
When are life insurance premiums deductible as a business expense?
Question 6 of 12
Because a variable annuity involves investment risk, what must a producer selling it hold in addition to a life insurance license?
Question 7 of 12
An insurer that has received a certificate of authority to transact business in a state is known as what?
Question 8 of 12
The needs approach to determining life insurance coverage focuses on what?
Question 9 of 12
James paid his premium on time for three years, and the insurer now discovers he had a minor error in his application. If the incontestability period has passed, what can the insurer do?
Question 10 of 12
Which statement best describes the difference between a warranty and a representation on an application?
Question 11 of 12
How is the growth of cash value inside a permanent life insurance policy taxed while the policy stays in force?
Question 12 of 12
What is the primary purpose of an annuity?
Answer key and explanations
The same twelve questions with the correct letter and the reason behind it. Open one after you have committed to an answer.
Question 1An insurance company formed under the laws of the state in which it is doing business is called what in that state?
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Answer: D. Domestic insurer
A domestic insurer is chartered in the state where it operates. A foreign insurer is formed in another state within the US. An alien insurer is formed in another country. Admitted describes an insurer authorized to do business, which is a separate concept from where it was formed.
Question 2Robert has no dependents but wants to cover his final expenses and a small charitable gift; which method most directly supports this planning?
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Answer: C. Needs approach
Because Robert is planning for specific costs rather than replacing income for dependents, the needs approach fits best. Human life value focuses on replacing income for survivors, which he does not have. A wage replacement multiplier assumes dependents relying on his wages. Income capitalization is another income based method, not suited to specific expense planning.
Question 3Under the misstatement of age provision, what happens if an insured understated his age on the application?
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Answer: B. The death benefit is adjusted to what the premiums paid would have bought at the correct age
When age is misstated, the benefit is adjusted to the amount the premiums actually paid would have purchased at the true age. The policy is not voided because a misstatement of age is a correctable error. The insurer does not simply refund premiums and cancel. The full stated benefit is not paid if premiums were too low for the real age.
Question 4An applicant intentionally hides a known serious heart condition on the application. This is best described as what?
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Answer: D. Concealment
Deliberately hiding a known material fact is concealment, which can allow the insurer to void the policy. A representation is a statement believed true, not a hidden fact. A waiver is voluntarily giving up a known right, and estoppel prevents someone from asserting a right after their actions led another to rely on the opposite. Neither fits this situation.
Question 5When are life insurance premiums deductible as a business expense?
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Answer: A. When an employer pays group life premiums for employees and is not the beneficiary
An employer may deduct premiums for group life coverage on employees when the business is not the beneficiary. Personal premiums are never deductible, so that choice is wrong. Key person premiums are not deductible because the business benefits, so that choice is wrong. Premium size compared to cash value does not create a deduction, so the last choice is wrong.
Question 6Because a variable annuity involves investment risk, what must a producer selling it hold in addition to a life insurance license?
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Answer: A. A securities registration
Variable products are considered securities, so the producer must be registered to sell securities in addition to holding a life license. A property and casualty license covers auto and home insurance, not annuities. A surety bond and a notary commission are unrelated to selling variable products.
Question 7An insurer that has received a certificate of authority to transact business in a state is known as what?
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Answer: A. Admitted insurer
An admitted, or authorized, insurer holds a certificate of authority to do business in the state. A nonadmitted insurer lacks that authority. Alien refers to formation in another country, and domestic refers to formation in the same state, neither of which describes authorization status.
Question 8The needs approach to determining life insurance coverage focuses on what?
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Answer: A. The specific financial obligations and goals the family must meet after the insured dies
The needs approach adds up the actual financial needs a family will have, such as final expenses, debts, income replacement, and education funds. It is correct because it is built around specific obligations. Lifetime earnings potential describes human life value, not the needs approach. The insurer's maximum is an underwriting limit, not a need measurement. Salary times a fixed multiplier is a rough rule of thumb, not the needs approach.
Question 9James paid his premium on time for three years, and the insurer now discovers he had a minor error in his application. If the incontestability period has passed, what can the insurer do?
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Answer: A. It cannot void the policy based on that application error
After the incontestability period, the insurer cannot void the policy for misstatements in the application. Voiding and keeping premiums is not allowed after that period. Raising the premium is not the remedy for an application error. Denying future claims for that reason is barred once the policy is incontestable.
Question 10Which statement best describes the difference between a warranty and a representation on an application?
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Answer: B. A representation is believed true, a warranty is guaranteed absolutely true
A representation only needs to be substantially true to the applicant's belief, while a warranty is a guarantee that a statement is completely true. The first choice reverses the terms. Not both need to be absolutely true, since representations only need to be materially true. Both can affect whether a policy is voidable, so the last choice is wrong.
Question 11How is the growth of cash value inside a permanent life insurance policy taxed while the policy stays in force?
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Answer: B. It grows tax deferred
Cash value grows on a tax deferred basis, meaning no tax is due while the money stays in the policy. It is not taxed annually, so the first and last choices are wrong. It is not taxed at the first premium, so that choice is wrong.
Question 12What is the primary purpose of an annuity?
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Answer: A. To provide a stream of income that a person cannot outlive
An annuity is designed to liquidate a sum of money into a stream of income, protecting against outliving one's assets. Creating an estate at death and paying off a mortgage at death are functions of life insurance, not annuities. Death benefits from life insurance are generally income tax free, but that is not the purpose of an annuity.
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Common questions
Are these real life insurance exam questions?
No. No legitimate prep company uses real exam questions, they are protected by candidate agreements. These twelve are ours, written to the shared core every state's exam outline covers. Your state's own practice test is written from its official outline.
How many questions are on the real exam?
It depends on the state. The exams we cover run from 50 scored questions to 125, most states add a handful of unscored pretest questions, and the clock runs from 75 minutes to 210. The state table has the exact numbers.
What score passes?
Thirty seven of the fifty exams we cover pass at 70, either 70 percent correct or a scaled 70. Alabama writes the same bar as a count, 87 correct of 125. California passes at 60 percent, Michigan at 72 percent, Mississippi at 65 percent, and Montana at a scaled 75. Seven states publish no number at all, and two publish a scaled score with no life specific mark.
Do I need an account to take this test?
No. These twelve questions are free and need no account. Inside the product your first 20 study questions are free too.
What does the full exam prep cost?
One License Pass, $79, yours until you pass. It covers the mastery map, the full question bank for your state, and full timed practice exams.
What RingReady is, and is not
RingReady sells study materials and practice exams for the life insurance licensing exam. We are not a prelicensing education provider on any state's list, and practicing here does not by itself satisfy any state's education requirement.
If your state requires prelicensing education, you must complete it with a provider your state insurance department lists. The department publishes that list. What we do is help the questions feel familiar when you sit down for the real exam.
Walk in already knowing the exam.
Practice questions written to every section of your state's official outline, full timed practice exams matched to the real format, and a mastery map that shows what to study next. The first 20 study questions are free, and the full License Pass is $79, yours until you pass.