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LIFE, HEALTH AND ACCIDENT QUESTIONS FOR PSI EXAM QUESTIONS WITH CORRECT ANSWERS
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LIFE, HEALTH AND ACCIDENT QUESTIONS FOR PSI EXAM QUESTIONS WITH CORRECT ANSWERS
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LIFE, HEALTH AND ACCIDENTQUESTIONS FOR PSI EXAM
QUESTIONS WITH CORRECT ANSWERS
It is the distribution of successes of funds accumulated by the insurer and participating
policies. - Answer-Which of the following statements regarding a life insurance policy
Dividened is true?
Losses due to fraud are eliminated. - Answer-Which of the following is not a benefit of
insurance?
Participating - Answer-John owns an insurance policy that gives him the right to share
and the insurer's surplus. What kind of policy is this?
Contract that allows the policy owner to receive a share surplus in the form of policy
dividends. - Answer-What is the participating life insurance policy?
Marketing - Answer-One important function of an insurance company is to identify and
sell potential customers which of these BEST describes this function?
Mutual Insurer - Answer-An insurer on by its policyholders is called a
Demutualization - Answer-When a mutual insurer becomes a stock company the
process is called?
Increases the unknown premium reserve - Answer-Which is not a characteristic for
reinsurance?
Capitive insurer - Answer-Which of the following is an insurer established by a parent
company for the purpose of ensuring the parent companies loss exposures?
Risk is eliminated - Answer-Which of the following is a type of insurance where an
insurer transfer loss exposures from written for it's insureds?
The greater the number insured the more accurately than sure can predict losses and
set appropriate premiums - Answer-And insured having a large number of similar
exposure unit it's considered important because.
Speculative risk - Answer-Which of the following is a situation where there is a
possibility of either lost or a gain?
Per risk is the only insurable risk - Answer-Which of these statements correctly
describes risk?
,Probability that an event will occur - Answer-Which of the following is not considered to
be a definition of the term "loss"?
Lost must be castastrophic - Answer-Which of the following is not an element of an
insurable risk?
A condition that may increase the likelihood of a loss occurring. - Answer-A hazard can
be best described as.
Moral Hazard - Answer-Which of the following describes the increase in the probability
of a loss due to ensure it's dishonest tendencies?
Increased chance of lost because of an insurance this honest tendencies. - Answer-
Moral hazard is described as the
Loss Exposure - Answer-Which of the following is considered to be any situation that
has the potential for loss?
Principle of indemnity - Answer-Restoring an insured to the same condition as before a
loss is known as.
Law of Large Numbers - Answer-Which of the following best describes the statement?
"the more times and event is repeating, the more predicting the outcome becomes?"
Probability of loss is a unknown - Answer-All of the following is a circumstance must be
met for loss retention to be an effective risk management technique except?
Pure Risk - Answer-A situation in which there is only a chance of loss or no loss is a?
Probability of loss - Answer-Which of the following is not required in the content of a
policy?
indemnity - Answer-Restoring and insured to the same condition as before a loss is an
example of the principal of?
Equal consideration is required between the involved parties - Answer-Which of the
following is not a requirement of a contract?
Rescind a policy - Answer-If a material warranty violation on the part of the insurance is
found, what recourse does an insurer have?
One party is restored to the same financial position the party was in before the loss
occurred - Answer-Which of the following statements correctly describes a contract of
indemnity?
,Indemnity - Answer-Reasonably necessarily as a currently described with the statement
" insureds are entitled to recover and amount not greater than the amount of the lights?
"
A contract may be accepted/rejected by the insured - Answer-Which statement is
correct when describing a contract adhesion?
Only one party (the insurer) makes any kind of legally enforceable promise. - Answer-
And unliteral contract is one which?
An offer and acceptance of the contract terms - Answer-A contract requires.
Make whole - Answer-What does the insurance term "indemnity" referred to?
The insured and insured contribution equally to the contract. - Answer-Which of the
following statements about aleatory contract is not true?
Materiality of concealment - Answer-The importance of a representation is
demonstrated in what rule?
Fiduciary - Answer-When handling premiums for insurance, and each and is acting in
which capacity?
Rescinding the contract - Answer-Which course of action is ensuring title II when
deliberate concealment is committed by the insured?
The policy's face amount - Answer-And a life insurance policies limit of liability would be.
Require a high premium payable at each renewal - Answer-In a renewable term life
insurance policy the contract will usually.
Decreasing term - Answer-Which of the following type of life insurance is normally
associated with a mortgage loan?
Non-medical - Answer-Which of the following is a life insurance policy that does not
require a physical exam?
Mortgage Redemption - Answer-Scott has just purchased a new house. He is now
shopping for a life insurance policy that provides a death benefit that matches the
protecting a death benefit that matches the project is outstanding debt of his mortgage.
Which live policy would best suit his needs?
Only children born to policies insue date maybe including - Answer-Which of the
following statements do not apply to child coverage in a family policy?
, Modified Endowment Contract (MEC) - Answer-And insurance policy Braden after 1988
the fails to pass to seven- pay test is known as.
Verbal Life - Answer-An insurance policy where the insured can choose where the cash
value can be invested is called
Applicants are not requested to answer medical questions on the application - Answer-
Which of the following is not a true description of a non-medical life insurance?
Joint Life Policy - Answer-Tom is shopping for a policy that covers two people I will pay
the face amount ONLY when the first person dies the type of life policy he is looking for
is called a period
Renewable Term - Answer-Lynn owns a life policy the guaranteed the right to renew the
policy each year, regardless of health, but an increased premium, what kind of policy is
this?
Modify premium, ordinary life, single premium - Answer-What is the proper order of
initial life insurance premiums from lowest to highest?
Second-to-die policy - Answer-John and Mary having a handicapped child that is
financially dependent upon them. The death of one of the parents will not be financially
disastrous, however the death of both likely would be. Which policy would best suited
for them?
10% - Answer-Mark, age 45 has a modified endowment contract what is the tax penalty
for taking a loan against his policy prior to age 59 1/2?
Conversion of child's coverage to permanent insurance regarding evidence of
insurability. - Answer-Which of the following is not true regarding a family policy that
covers children?
Currently Insured - Answer-Which Social Security said it does a worker with 6 quarter of
coverage during the last 13 quarter period have?
endowment insurance - Answer-The life-insurance policy that pays the face amount if
the insured survive to a specific period of time it's called.
12 months - Answer-How long is a person expected to be disabled in order to receive
Social Security disability benefits?
10% - Answer-And a modified endowment contract, the penalty tax imposed a
premature withdraws is.
Benefits are designed to replace the entire amount of the workers earnings - Answer-
Which statement is not true regarding Social Security benefits?
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