State RegulationsCA specific✓ Verified · outline & fact-checked · Sep 2026Difficulty 2/5
Under California law, when an agent uses a policy illustration in a life insurance sale, the illustration must:
Select an option to reveal the answer and the full 3-part explanation — free, no signup.
Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
California's illustration regulations (CIC §10509.950 et seq.) require that life insurance illustrations use standardized assumptions so consumers can compare policies, and that they be signed by both the applicant and the agent before the application is taken. The illustration must distinguish guaranteed values from nonguaranteed projections and cannot show dividends or values that are not supportable. Illustrations are disclosure tools and do not replace the buyer's guide, nor may they be used orally in place of a written document.
Why the other options are wrong
- B) Illustrations must be given to the applicant in writing and signed; oral-only use violates the disclosure rules.
- C) Dividends and nonguaranteed values must be labeled as nonguaranteed; projecting them as guaranteed is prohibited.
- D) The illustration supplements, but does not replace, the buyer's guide, policy summary, and cost index disclosures.
Memory hook
CA illustrations: signed by both, grounded in allowed assumptions, never a promise of dividends.