Minnesota Life Insurance Practice Exam Free - 2026

• A. Before midnight of the 30th day after the application date
• B. Within 20 days of the application date
• C. Within 15 days of receiving the policy
• D. Before midnight of the tenth day following the date she received the policy

Correct answer: D. Before midnight of the tenth day following the date she received the policy

Explanation: Minnesota's right-to-cancel statute defines the date of purchase as the date the purchaser receives a copy of the policy and allows an individual to cancel a life or annuity contract (authorized under § 60A.06, subd. 1, cl. (4)) or an individual health policy by returning it with written notice any time before midnight of the tenth day following that date. The insurer must refund the entire consideration within ten days. The 30-day period applies to Medicare supplement, long-term care, and replacement policies, not to an ordinary new life policy, and 15 and 20 days are not Minnesota periods. See Minn. Stat. § 72A.51.

• A. One year after default
• B. Three years after default
• C. Five years after default
• D. Six months after default

Correct answer: B. Three years after default

Explanation: Minnesota life policies must contain a provision allowing reinstatement at any time within three years following the date of default, unless the policy was surrendered for cash, upon evidence of insurability satisfactory to the company and payment of overdue premiums and indebtedness with interest. One year, six months, and five years are not the statutory period. See Minn. Stat. § 61A.03, subd. 1.

• A. No interest is owed because the policy was paid within the two-month settlement window.
• B. Interest at the policy loan rate from the date of the claim filing only.
• C. Interest computed from the date of death, at a rate two percent higher than the rate otherwise payable, because payment was not made within 60 days of proof of death.
• D. Interest at 15 percent simple interest from the date of death.

Correct answer: C. Interest computed from the date of death, at a rate two percent higher than the rate otherwise payable, because payment was not made within 60 days of proof of death.

Explanation: Minnesota requires insurers to pay interest on life proceeds computed from the insured's death until the date of payment; if payment is not made within 60 days of receipt of proof of death, the rate is two percent more than the rate otherwise applicable. Option A is wrong because the payment here exceeded 60 days, option B misstates the accrual date, and 15 percent is the no-fault overdue-benefit interest rate under § 65B.54, not the life rule. See Minn. Stat. § 61A.011.

• A. She may continue the group life coverage for up to 18 months, paying no more than 102 percent of the plan cost, and has 60 days to elect after being notified.
• B. She may continue coverage for up to 36 months at no cost.
• C. She has no continuation right; she may only convert within 31 days.
• D. She may continue for 12 months at 150 percent of the plan cost.

Correct answer: A. She may continue the group life coverage for up to 18 months, paying no more than 102 percent of the plan cost, and has 60 days to elect after being notified.

Explanation: Minnesota requires group life policies to allow a terminated or laid-off employee to continue coverage for up to 18 months (or until covered elsewhere, if sooner) at a premium not exceeding 102 percent of the plan's cost; the employer must inform the employee within 14 days and the employee has 60 days to elect. The 31-day conversion right under § 61A.09 exists in addition to, not instead of, continuation. Thirty-six and 12 months and 150 percent are not the Minnesota figures. See Minn. Stat. § 61A.092.

• A. The daughter, because a beneficiary designation survives any sale
• B. The settlement provider or its investors, who became the policy's owner and beneficiary and paid the premiums after the sale
• C. The insured's estate
• D. The insurer keeps it, because settled policies are void at death

Correct answer: B. The settlement provider or its investors, who became the policy's owner and beneficiary and paid the premiums after the sale

Explanation: A life settlement transfers ownership of the policy: the buyer takes over premium payments, names itself beneficiary, and collects the death benefit when the insured dies. The original beneficiary's expectation ends at the sale - a consequence the seller should weigh, since the family receives only whatever remains of the settlement proceeds. See finra.org.

• A. Guaranteed issue
• B. Simplified issue
• C. Full (traditional) underwriting
• D. Post-claim underwriting

Correct answer: B. Simplified issue

Explanation: Simplified issue underwriting skips the medical exam but still asks health questions and screens the answers against sources such as MIB records and prescription-history databases. Because the insurer accepts more uncertainty than with a fully underwritten policy, coverage amounts are usually smaller and the premium per dollar of coverage is usually higher.

• A. A guaranteed issue policy
• B. A preferred risk policy
• C. A simplified issue policy
• D. A group conversion policy

Correct answer: A. A guaranteed issue policy

Explanation: Guaranteed issue life insurance accepts every applicant in the eligible age band with no health questions and no exam. Since the insurer cannot screen out poor risks, these policies are sold in small face amounts (often marketed for final expenses), carry the highest premium per dollar of coverage, and nearly always include a graded death benefit for the first years.

• A. Nothing, because the policy was not yet in force
• B. The full face amount
• C. A refund of the premiums paid, often plus interest
• D. Only the policy's cash surrender value

Correct answer: C. A refund of the premiums paid, often plus interest

Explanation: Under a typical graded death benefit, death from natural causes during the graded period (commonly the first two or three policy years) pays a return of the premiums paid, often with interest, rather than the face amount. Accidental death is usually covered for the full face amount from the first day. After the graded period ends, natural death also pays the full benefit.

• A. Guaranteed issue
• B. Postmortem underwriting
• C. Group underwriting
• D. Accelerated underwriting

Correct answer: D. Accelerated underwriting

Explanation: Accelerated underwriting uses data and predictive models to deliver a decision comparable to full underwriting without the exam for applicants who qualify. Unlike simplified issue, pricing can match fully underwritten rates - but applicants whose data raises questions can still be routed into traditional underwriting with an exam.

• A. A paramedical exam
• B. An attending physician statement
• C. An inspection report
• D. A Medical Information Bureau screening

Correct answer: A. A paramedical exam

Explanation: A paramedical exam is performed by a nurse or trained technician rather than a physician and typically includes a health questionnaire, basic measurements, and specimen collection. It differs from an attending physician statement, which is a report requested from a doctor who has treated the applicant, and from MIB checks, which query coded industry records.

• A. Guaranteed issue will be cheaper because it skips the exam
• B. Both cost the same by law
• C. Guaranteed issue is not designed for this need - it offers small face amounts at high cost, priced for applicants who cannot pass underwriting
• D. Fully underwritten coverage is only for applicants over 60

Correct answer: C. Guaranteed issue is not designed for this need - it offers small face amounts at high cost, priced for applicants who cannot pass underwriting

Explanation: Guaranteed issue exists for people who cannot pass underwriting: it offers small face amounts, the highest cost per dollar of coverage, and graded death benefits. A healthy applicant who can complete full underwriting will nearly always pay less per dollar of coverage for far more coverage. Steering an insurable client seeking $500,000 toward guaranteed issue would be unsuitable.

• A. To provide financial protection to beneficiaries upon the insured's death
• B. To reimburse the insured for damage to the insured's home, vehicles, or personal property
• C. To pay the insured's hospital and physician expenses during a period of serious illness
• D. To guarantee a stated retirement income to the policyowner beginning at a chosen age

Correct answer: A. To provide financial protection to beneficiaries upon the insured's death

Explanation: The primary purpose of life insurance is to provide financial protection to beneficiaries (such as family members) when the insured person dies. While some policies have cash value components, the core function is death benefit protection.