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Ohio Life Insurance, Annuity and Viatical Settlement Law: Practice Questions

20 free practice questions with explanations. Pick an answer for each, then check your score.

Exam weight: Ohio rules in the life, annuity and viatical settlement sections on the Ohio Life, Accident and Health agent exam (11-35). Updated 2026-11-05.

Quick study guide

Ohio has no separate state-law part on the 11-35 exam: its life and annuity rules sit inside outline sections 3.0 to 6.0, and the Ohio questions usually turn on a number in the Revised Code or a Department of Insurance rule.

Policy provisions (§ 3915.05 and related sections)

Provision	Ohio rule
Grace period	One month for every premium after the first; the overdue premium may be deducted if the insured dies during it
Incontestability	Incontestable after no more than 2 years from the policy date, except nonpayment and some war, aviation, disability and accidental death terms; separately, § 3911.07 bars defenses other than fraud (except age) once 3 annual premiums are received
Misstated age	Pays what the premium would have bought at the correct age
Reinstatement	Within 3 years of default if not surrendered, with evidence of insurability and arrears plus interest
Death claims	Settled on due proof of death, or no later than 2 months after it is received
Lawsuits	A policy may not limit the time to sue to less than 5 years (§ 3915.09)
Backdating	No more than 6 months before the application if that lowers the premium (§ 3915.13)

Beneficiaries and group conversion

Proceeds payable to a spouse, children, dependents, a qualifying charity or a creditor are free from the insured's creditors, except premiums paid in fraud of creditors (§ 3911.10). A group member whose coverage ends can convert within 31 days without evidence of insurability; late notice extends that to 15 days after notice, capped at 60 days past the period. When the group plan itself ends, only people insured for 5 years can convert, and the insurer may cap the policy at $10,000 (§ 3917.06).

Selling life insurance and annuities

The Buyer's Guide and policy summary come before the insurer accepts the first premium, or with the policy if it has an unconditional refund of at least 10 days (3901-6-03). A policy issued other than as illustrated needs a signed "Revised Illustration" by delivery (3901-6-04). In a replacement the replacing insurer notifies the existing insurer within 5 business days and gives a 30-day full refund right (3901-6-05). Annuity recommendations must meet the best-interest care, disclosure, conflict of interest and documentation obligations of 3901-6-13, including a look at exchanges in the past 60 months.

Guaranty association, living benefits and viaticals

Per life, the guaranty association covers up to $300,000 in death benefits, $100,000 in cash values and $250,000 in annuity present value, generally $300,000 in all, and nobody may use it as a selling point (§§ 3956.04, 3956.18). Accelerated death benefits are life insurance benefits; a requested claim form is due within 15 days (3901-6-06). An HIV test needs written consent and is given only with other tests (§ 3901.46). A viator can rescind for at least 15 days after receiving the proceeds, and most settlements within 5 years of issue are banned unless a listed event occurs (Chapter 3916).

Practice questions

The second-year annual premium on an Ohio whole life policy was due on 10 April and has not been paid. The insured dies on 25 April. The policy contains the grace period provision required by Ohio Rev. Code § 3915.05(B), with the optional deduction clause. What does the beneficiary receive?
1. A.Only the cash surrender value the policy had on 10 April
2. B.The full death benefit plus a refund of the first-year premium
3. C.The death benefit, less the overdue premium
4. D.Nothing, because the policy lapsed when the premium was not paid on 10 April
Show answer
Answer: C. Section 3915.05(B) requires a grace period of one month for every premium after the first, during which the insurance continues in force. The provision may state that if the insured dies during the month of grace, the overdue premium is deducted in any settlement. The policy had not lapsed on 25 April, and the statute gives no premium refund.
Source: Ohio outline 5.1: Standard provisions, grace period (3915.05(B)); Ohio Rev. Code § 3915.05
Under Ohio Rev. Code § 3911.07, once an insurer has received how many annual premiums on a life policy is it barred from defending a claim on any ground other than fraud, based on errors, omissions or misstatements the insured made in the application (except as to age)?
1. A.Two
2. B.Five
3. C.Three
4. D.Ten
Show answer
Answer: C. Section 3911.07 says that after receiving three annual premiums, all companies are estopped from defending on any ground other than fraud against a claim based on errors, omissions or misstatements in the application, except as to age. This works alongside § 3915.05(C), which separately requires the policy itself to become incontestable after it has been in force during the insured's lifetime for no more than two years from its date. Five and ten premiums appear in neither section.
Source: Ohio outline 5.1: Incontestability (3915.05(C), 3911.07); Ohio Rev. Code § 3911.07; Ohio Rev. Code § 3915.05
An applicant signs an Ohio life insurance application on 1 September and takes the insurer's required medical exam on 15 September. The applicant wants the policy dated back so the premium is based on a younger age. Under Ohio Rev. Code § 3915.13, what is the earliest date the policy may take effect?
1. A.15 March
2. B.15 June
3. C.1 March
4. D.1 September
Show answer
Answer: A. Section 3915.13 bars a policy dated more than six months before the application was made if that reduces the premium below the rate for the insured's nearest birthday at application. When a medical exam is required, the application date is the later of the date it was signed or the exam date, here 15 September, so six months back is 15 March. Using 1 September as the base would allow 1 March, which is too early, and the section does not limit backdating to three months or forbid it.
Source: Ohio outline 3.8: Backdating of policies (3915.13); Ohio Rev. Code § 3915.13
An insurer's draft Ohio life policy form says that any lawsuit on the policy must be filed within three years after the cause of action accrues. Under Ohio Rev. Code § 3915.09, this provision is:
1. A.Allowed, if the limit is printed in bold type on the first page
2. B.Allowed, because it gives more time than the two-year contestable period
3. C.Prohibited, because a life policy may not contain any time limit on lawsuits
4. D.Prohibited, because a life policy may not limit the time to sue to less than five years
Show answer
Answer: D. Section 3915.09(B) bars a life policy issued or delivered in Ohio from containing a provision limiting to less than five years the time within which an action at law or in equity may be brought after the cause of action accrues. A three-year limit is therefore prohibited, however it is printed. The section does not ban time limits altogether; a limit of five years or more is permitted.
Source: Ohio outline 5.1: Prohibited provisions (3915.09); Ohio Rev. Code § 3915.09
An employee leaves her job, and her group life coverage ends. She is not told about her right to convert until 40 days after the coverage ended, after the policy's 31-day conversion period has expired. Under Ohio Rev. Code § 3917.06(H)(3), what is her position?
1. A.She has a fresh 60 days, counted from the date she receives the notice
2. B.15 days after the notice, but no later than 60 days after the 31-day period ended
3. C.She has lost the right, because the 31-day conversion period has already run
4. D.She has a fresh 31 days, counted from the date she receives the notice
Show answer
Answer: B. Section 3917.06(H)(1) lets a person whose group life coverage ends with employment buy an individual policy without evidence of insurability by applying and paying the first premium within 31 days. Under (H)(3), if the person is not given notice at least 15 days before that period expires, the right extends to 15 days after notice is given, but never beyond 60 days after the period ends. The right is not lost, and the extension does not restart a full 31 or 60 days from notice.
Source: Ohio outline 4.5: Group life, conversion to individual policy (3917.06(H), (I)); Ohio Rev. Code § 3917.06
An Ohio insured names his wife as beneficiary of a $250,000 life policy. When he dies, he owes $90,000 to unsecured creditors. Under Ohio Rev. Code § 3911.10, can those creditors reach the policy proceeds?
1. A.No, but only if the wife was named as an irrevocable beneficiary
2. B.No, except that premiums paid in fraud of creditors can be recovered from the proceeds
3. C.Yes, because life insurance proceeds always pass through the insured's estate
4. D.Yes, up to the full $90,000, because debts are paid before beneficiaries
Show answer
Answer: B. Section 3911.10 says life policies made payable to the insured's spouse, children, dependents, a qualifying charity or a creditor are held, with their proceeds, free from all claims of the insured's creditors, even if the beneficiary designation can be changed. The one exception is that premiums paid in fraud of creditors, with interest, go to the creditors out of the proceeds. Proceeds payable to a named spouse do not pass through the estate, and the protection does not depend on an irrevocable designation.
Source: Ohio outline 5.2: Beneficiaries (3911.09, .10, .13, .14); Ohio Rev. Code § 3911.10
An agent sells an Ohio whole life policy that gives the owner an unconditional refund right of 10 days, and no illustration is used in the sale. Under Ohio Adm. Code 3901-6-03(E)(1), by when must the applicant receive the Buyer's Guide and the policy summary?
1. A.Before the agent takes the application
2. B.Within 30 days after the policy is delivered
3. C.With the policy or before it is delivered
4. D.Only if the applicant asks for them in writing
Show answer
Answer: C. Rule 3901-6-03(E)(1) makes the insurer give every prospective purchaser the Buyer's Guide and a policy summary before accepting the initial premium or premium deposit. If the policy or its summary has an unconditional refund provision of at least ten days, both may instead be delivered with the policy or before delivery. Delivery is a duty, not something that waits for a request; paragraph (E)(3) separately requires them to be available on request.
Source: Ohio outline 3.8: Buyer's guide and policy summary (3901-6-03(D)(1), (D)(6)); Ohio Adm. Code 3901-6-03
Which of these statements by an agent soliciting a life insurance policy in Ohio is specifically prohibited by Ohio Adm. Code 3901-6-01?
1. A."The dividends shown are based on the current scale and are not guaranteed."
2. B."This sales presentation is on file with the Ohio Department of Insurance."
3. C."I am a life insurance agent, and I represent Buckeye Mutual Life Insurance Company."
4. D."The guaranteed cash values for each policy year are shown in the table."
Show answer
Answer: B. Rule 3901-6-01(F) lists sales practices barred in soliciting life insurance and annuities, and paragraph (F)(31) bars stating that the sales presentation delivered to the prospect is on file with the Department of Insurance. Identifying yourself as a life insurance agent and naming the insurer is required before a presentation by 3901-6-03(G)(2). Explaining that illustrated dividends are not guaranteed is what (F)(21) requires, and pointing to guaranteed values is not misleading.
Source: Ohio outline 3.8: Solicitation, sales presentations, and disclosure requirements (3901-6-01, 03); Ohio Adm. Code 3901-6-01; Ohio Adm. Code 3901-6-03
A universal life policy was applied for as illustrated, but the insurer issues it in a higher-risk rating class with different values. Under Ohio Adm. Code 3901-6-04(I)(1)(b), what must happen?
1. A.The insurer must mail a new illustration within 30 days after delivery
2. B.The agent must explain the differences orally at delivery
3. C.A "Revised Illustration" matching the issued policy, signed by owner and agent by delivery
4. D.Nothing more, because the original signed illustration stays valid
Show answer
Answer: C. Rule 3901-6-04(I)(1)(b) says that if a policy is issued other than as applied for, a revised basic illustration conforming to the policy as issued must be sent with the policy. It must be labeled "Revised Illustration" and be signed and dated by the applicant or policy owner and the agent no later than the time the policy is delivered, with copies to the insurer and owner. An oral explanation or a later mailing does not satisfy the rule.
Source: Ohio outline 3.8: Illustrations (3901-6-04); Ohio Adm. Code 3901-6-04
An Ohio agent submits an application for a new annuity, and the application shows the client will surrender an existing annuity issued by another company. Under Ohio Adm. Code 3901-6-05(G)(1)(b), the replacing insurer must notify the existing insurer within:
1. A.30 days after the new contract is delivered
2. B.10 days after the new contract is issued
3. C.3 business days of receiving the completed application
4. D.5 business days of receiving the completed application
Show answer
Answer: D. Rule 3901-6-05(G)(1)(b) requires the replacing insurer to notify any existing insurer that may be affected within five business days of receiving a completed application indicating replacement, or of identifying the replacement if the application did not show it. It must also send the existing insurer a copy of the available illustration, policy summary or disclosure document within five business days of a request. The 10-day and 30-day periods belong to other parts of the rule: 10 days for an insurer's sales-material confirmation letter under (G)(3), and 30 days for the owner's refund right under (G)(1)(d).
Source: Ohio outline 3.8: Replacement (3901-6-05); Ohio Adm. Code 3901-6-05
An Ohio insurer issues a new fixed whole life policy that replaces a client's existing policy with another company. Under Ohio Adm. Code 3901-6-05(G)(1)(d), what right must the replacing insurer give the policyowner?
1. A.To return the policy within 10 days of delivery for a refund of premiums less a policy fee
2. B.To return the policy within 20 days of the application date for a full refund
3. C.To return it within 30 days of delivery for a full refund of all premiums and fees
4. D.To return the policy within 30 days of delivery for its cash surrender value only
Show answer
Answer: C. Rule 3901-6-05(G)(1)(d) requires the replacing insurer to give the owner notice of the right to return the policy or contract within 30 days of delivery and receive an unconditional full refund of all premiums or considerations paid, including any policy fees or charges. Only for a variable or market value adjusted product may the refund be the cash surrender value plus the fees and charges deducted. The period runs from delivery, and no fee may be kept.
Source: Ohio outline 3.8: Replacement (3901-6-05); Ohio Adm. Code 3901-6-05
After hearing an Ohio agent's recommendation, a consumer insists on buying a different fixed indexed annuity that the agent did not recommend. Under Ohio Adm. Code 3901-6-13, what should the agent obtain?
1. A.A statement from the consumer's attorney that the purchase is in the consumer's best interest
2. B.A consumer-signed statement acknowledging the annuity transaction is not recommended
3. C.Written approval from the Ohio Department of Insurance before submitting the application
4. D.A signed waiver of the consumer's free look period on the new annuity contract
Show answer
Answer: B. Under the documentation obligation in 3901-6-13(F)(1)(d)(iii), if a customer decides to enter into an annuity transaction not based on the agent's recommendation, the agent obtains a consumer-signed statement on a form substantially similar to Appendix C acknowledging that the transaction is not recommended. Paragraph (F)(2) then relieves the agent of the best-interest obligations for that transaction, though the insurer's issuance must still be reasonable on what it knows. The rule requires no department approval, free-look waiver or attorney statement.
Source: Ohio outline 6.1: Suitability requirements (3901-6-13); Ohio Adm. Code 3901-6-13
An Ohio resident owns a deferred annuity with a present value of $380,000. The issuing insurer becomes insolvent. Under Ohio Rev. Code § 3956.04(D), what is the most the Ohio Life and Health Insurance Guaranty Association is liable for on this annuity?
1. A.$300,000
2. B.$380,000
3. C.$100,000
4. D.$250,000
Show answer
Answer: D. Section 3956.04(D)(2)(a)(vi) caps the association's liability at $250,000 for the present value of annuity benefits, including net cash surrender and withdrawal values, for any one life. The $300,000 figure is the limit for life insurance death benefits and the general aggregate cap per individual, and $100,000 is the limit for life insurance cash values. The association never pays more than the lesser of the contract's obligations and these limits.
Source: Ohio outline 3.8: Life and Health Insurance Guaranty Association (3956.04, .06, .18; 3901-1-52); Ohio Rev. Code § 3956.04
A prospect worries that an insurer offering a high annuity rate may be financially weak. The agent replies, "Don't worry, the Ohio Life and Health Insurance Guaranty Association backs this contract." Under Ohio Rev. Code § 3956.18, the agent's statement is:
1. A.Permitted, as long as the agent also states the coverage limits
2. B.Prohibited only if the statement is made in writing or in an advertisement
3. C.Prohibited, because the association's existence may not be used to sell covered insurance
4. D.Permitted, if the agent hands over the association's summary document at the same time
Show answer
Answer: C. Section 3956.18(A) bars any person, including a member insurer or its agents, from making any written or oral statement that uses the existence of the guaranty association for sales, solicitation or inducement to purchase covered insurance. Insurers must deliver the association's summary document before or at policy delivery under 3956.18(B), in the exact form set by Ohio Adm. Code 3901-1-52, but its disclaimer itself warns buyers not to rely on the association when choosing an insurer. Stating limits or giving the document does not make the sales use lawful, and the ban covers oral statements too.
Source: Ohio outline 3.8: Life and Health Insurance Guaranty Association (3956.04, .06, .18; 3901-1-52); Ohio Rev. Code § 3956.18; Ohio Adm. Code 3901-1-52
An Ohio viator receives the viatical settlement proceeds on 3 May. Under Ohio Rev. Code § 3916.08, the contract must give the viator an unconditional right to rescind for at least:
1. A.10 days after the policy is assigned to the provider
2. B.3 business days after signing the contract
3. C.30 calendar days after signing the contract
4. D.15 calendar days after receiving the proceeds
Show answer
Answer: D. Section 3916.08 requires every viatical settlement contract entered into in Ohio to give the viator an unconditional right to rescind for at least 15 calendar days after receipt of the proceeds, here at least until 18 May. If the insured dies during that period, the contract is treated as rescinded, subject to repayment of all proceeds to the provider, and ownership reverts to the viator or the viator's estate. Ohio's minimum runs from receipt of the proceeds, not from signing.
Source: Ohio outline 3.5: Viatical settlement contract (3916.01(O), 3916.08); Ohio Rev. Code § 3916.08
Dana has held an Ohio resident insurance agent license with a life line of authority for six years and is in good standing. Now and then, as a side part of her insurance business, she helps clients negotiate the sale of their policies to viatical settlement providers. Under Ohio Rev. Code §§ 3916.02 and 3916.04, which is true?
1. A.She may refer clients to providers but may not negotiate for them unless she has 10 years of licensure
2. B.She may broker without a separate license and owes the viator a fiduciary duty
3. C.She may act without a broker license, but she represents the provider that pays her commission
4. D.She must obtain a viatical settlement broker license, because no insurance agent is exempt
Show answer
Answer: B. Section 3916.02(C)(2) lets an individual agent in good standing who has held a resident or nonresident Ohio license with a life line of authority for at least five years operate as a viatical settlement broker without a separate license, if the broker activity is incidental to the agent's insurance business. Section 3916.04 says a broker, however compensated, represents only the viator and owes the viator a fiduciary duty to act on the viator's instructions and in the viator's best interest. Ten years is not the test, and the broker never represents the provider.
Source: Ohio outline 3.5: Viatical settlement broker (3916.01(N), .02, .03, .04); Ohio Rev. Code § 3916.02; Ohio Rev. Code § 3916.04
An Ohio policyowner bought a $500,000 individual life policy 18 months ago and wants to sell it to a viatical settlement provider. Under Ohio Rev. Code § 3916.16(B), which development, arising after the policy was issued and supported by independent evidence, would allow the settlement now?
1. A.The policy's cash value has grown faster than projected
2. B.The owner wants the money for a down payment on a vacation home
3. C.The owner has retired from full-time employment
4. D.A provider has offered more than the cash surrender value
Show answer
Answer: C. Section 3916.16(B) makes it a violation to enter into a viatical settlement within five years of a policy's issue unless an exception applies. One exception is that the viator certifies, with independent evidence, a listed event arising after issue: terminal or chronic illness, the death of a spouse, divorce, retirement from full-time employment, a disability that prevents full-time work, bankruptcy or insolvency, or the death of a family member who is the sole beneficiary. A good price, cash value growth or a wish for cash are not listed, and the separate two-year self-funding route in (B)(4) is not available at 18 months.
Source: Ohio outline 3.5: Promoting purchase for purpose of selling (3916.16); Ohio Rev. Code § 3916.16
Ohio Rev. Code § 3916.05(B) requires life insurers to include questions in their applications designed to identify and prevent stranger-originated life insurance (STOLI). Under Ohio Adm. Code 3901-9-04, which of these applications does NOT need STOLI questions?
1. A.An application for a $250,000 term life policy
2. B.An application for a $400,000 survivorship whole life policy
3. C.An application for a $1,000,000 universal life policy on a 75-year-old
4. D.An application for a $150,000 whole life policy owned by the applicant's adult child
Show answer
Answer: A. Rule 3901-9-04(D)(1) excludes several types of application from the STOLI-question requirement, including term life insurance, credit life, policies owned by a qualified retirement plan, worksite and direct-response applications, and policies with a death benefit of $50,000 or less. Permanent policies above $50,000, such as the universal life, survivorship and whole life applications listed, must include the questions. Section 3916.01(X) defines STOLI as an arrangement, started at or before issue, to buy a policy mainly for people without an insurable interest in the insured and then transfer it.
Source: Ohio outline 3.5: Stranger Originated Life Insurance (3916.05(B); 3901-9-04); Ohio Adm. Code 3901-9-04; Ohio Rev. Code § 3916.05; Ohio Rev. Code § 3916.01
An insured asks to accelerate the death benefit under an Ohio life policy rider subject to Ohio Adm. Code 3901-6-06, and the insurer requires a claim form. If the insurer does not provide the claim form within the time the rule allows, what happens?
1. A.The insurer must send it within 60 days, and payment can wait until the form is returned
2. B.No deadline applies, because claim procedures for accelerated benefits are left to the policy
3. C.The insurer has 30 days to send it, after which the request lapses
4. D.It must be sent within 15 calendar days, or written proof of eligibility is deemed enough
Show answer
Answer: D. Rule 3901-6-06(G)(2) says payment of the accelerated death benefit is due immediately on receipt of due written proof of eligibility, and an insurer that requires a claim form must provide it within 15 calendar days of the acceleration request. If it does not, written proof of eligibility is deemed sufficient. The same rule requires a lump-sum payment option and bars waiting periods and deadlines for submitting proof of eligibility.
Source: Ohio outline 5.8: Living benefit provisions/riders (3915.21-.24; 3901-6-06); Ohio Adm. Code 3901-6-06; Ohio Rev. Code § 3915.21
An insurer underwriting an individual life insurance application in Ohio wants the applicant to take an HIV test. Under Ohio Rev. Code § 3901.46, what must the insurer do?
1. A.Get verbal consent, after which any positive result may be shared with the writing agent
2. B.Order the test only for applicants whose answers suggest a particular sexual orientation
3. C.Get written consent, explain the test's purpose, and test only alongside other health tests
4. D.Order the test without separate consent, since the application authorizes all testing
Show answer
Answer: C. Section 3901.46(A) lets an insurer require an HIV test only in conjunction with tests for other health conditions, and never on the basis of the applicant's sexual orientation. Under 3901.46(B)(1) the insurer must get the applicant's written consent and explain the purpose, and the consent form covers the tests, confidentiality, how results are reported and how they are interpreted. A positive result may be disclosed only to the applicant, a provider or person the applicant designates in writing, or a confidential medical information exchange, not to the agent.
Source: Ohio outline 3.9: Medical examinations and lab tests including HIV (3901.46(A), (B)(1)); Ohio Rev. Code § 3901.46

Where these questions come from: Ohio Life, Accident and Health agent exam outline (series 11-35, PSI bulletin updated 24 Mar 2026), sections 3.0: Life Insurance Basics (8%), 4.0: Life Insurance Policies (7%), 5.0: Life Insurance Policy Provisions, Options and Riders (9%) and 6.0: Annuities (5%). See how we write questions.