Types of life insurance practice questions (Massachusetts Life exam)
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Section I of the Massachusetts Life Producer exam, "Types of Policies," has 15 scored questions. [1] The outline lists traditional whole life (ordinary, limited-pay and single-premium), interest and market sensitive products (universal, variable whole, variable universal, interest-sensitive whole and indexed life), term life (level, decreasing, return of premium, annually renewable, plus renewable and convertible features), annuities, and joint and survivorship life. [1] This page explains the main policy types using the Massachusetts Division of Insurance's own consumer guides, then gives 10 practice questions.
The main types, as the Division of Insurance describes them
- Term life: "Term Life Insurance covers you for a term of one or more years. It pays a death benefit only if you die in that term." [2] Term policies generally have no cash value. [3]
- Renewable term: a term policy may let coverage continue at the end of the term, and premiums at renewal may be higher. [3]
- Conversion: conversion privileges let you move from a term policy to a new whole life policy. [3]
- Whole life: "Whole Life Insurance covers you for as long as you live, as long as you pay the premiums." [2]
- Universal life: lets you vary your premium payments and when you pay them. [2]
- Variable life: "Variable Life Insurance benefits (both the death benefit and earnings) vary based on the investment performance" of the underlying investments. [2]
- Cash value policies: "Whole life, universal life, and variable life are types of cash value policies." [3]
- Annuities: "An annuity can give you a regular income paid out over a period of time for retirement purposes." "An annuity is not a life insurance policy." [4]
Practice questions
1. Which type of policy pays a death benefit only if the insured dies during a set period?
A. Whole life
B. Term life
C. Universal life
D. Variable life
Answer: B. Term life covers you for a term of one or more years and pays only if you die in that term. [2]
2. Which of these generally has no cash value?
Answer: Term life. The Division says, "Generally, term policies have no cash value." [3]
3. A policyholder wants a policy that lasts for life as long as premiums are paid. Which type fits?
Answer: Whole life. [2]
4. Which policy type lets the owner vary the amount and timing of premium payments?
Answer: Universal life. [2]
5. In which policy do both the death benefit and earnings change with investment performance?
Answer: Variable life. [2]
6. Under Massachusetts law, what is a "contract on a variable basis"?
Answer: A policy or contract whose benefits or values vary, in whole or in part, to reflect the investment results of a separate investment account. (M.G.L. c. 175, s. 132G) [5]
7. A term policyholder renews at the end of the term. What usually happens to the premium?
Answer: It may be higher at renewal. Some policies cannot be renewed past a certain age. [3]
8. What does a conversion privilege allow?
Answer: Moving from a term policy to a new whole life policy. [3] The Division's guide adds that conversion is usually allowed until age 65. [2]
9. Is an annuity a life insurance policy?
Answer: No. "An annuity is not a life insurance policy," and annuities "are not savings accounts." [4]
10. A buyer cashes out an annuity early. What risk does the Division warn about?
Answer: Surrender charges. "You may lose much of your money in surrender charges if you take the money out." [4] For annuity contracts, Massachusetts law also lets a company reserve the right to defer paying a cash surrender benefit for up to 6 months after demand, with the commissioner's written approval. (M.G.L. c. 175, s. 144A 1/2) [6]
More from the Division's guides
- Term life usually gives "the most insurance for the least amount of money." [3]
- Renewable term comes in lengths such as 5, 10, 20 or even 30 years. [2]
- A whole life policy usually has no cash surrender value for at least 3 to 5 years. [2]
Study tips
- Sort the types into two groups: term (no cash value, set period) and cash value (whole, universal, variable).
- Know what changes in each: universal varies premiums, variable varies benefits with investments.
Try the free Massachusetts Life practice test next.
Prep Retention is independent and is not affiliated with Pearson VUE or the state.
Sources
- Pearson VUE, Massachusetts content outlines 122301 (effective July 22, 2026): https://www.pearsonvue.com/content/dam/VUE/vue/en/documents/publications/122301.pdf
- Massachusetts Division of Insurance, Buying Life Insurance and Annuities in Massachusetts, Part Two: https://www.mass.gov/info-details/buying-life-insurance-and-annuities-in-massachusetts-part-two
- Massachusetts Division of Insurance, Life Insurance Basics: https://www.mass.gov/info-details/life-insurance-basics
- Massachusetts Division of Insurance, Buying Life Insurance and Annuities in Massachusetts, Part One: https://www.mass.gov/info-details/buying-life-insurance-and-annuities-in-massachusetts-part-one
- M.G.L. c. 175, s. 132G: https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter175/Section132G
- M.G.L. c. 175, s. 144A 1/2: https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter175/Section144A1~2