PSI: LIFE, ACCIDENT, AND HEALTH
PRACTICE EXAM
Question 1: Under the misstatement of age or gender
provision, what happens if it is determined at death that the insured's age or gender was misstated on a life insurance policy application?
CORRECT ANSWER : Benefits are adjusted to an amount
that the premium would have purchased at the correct age or gender.
Question 2: Which of the following must be given to the
insurer within 20 days after occurrence or commencement of any loss covered by the policy, or as thereafter as is reasonably possible?
CORRECT ANSWER : Notice of claim.
Question 3: When will a policy pay on a UCR basis?
CORRECT ANSWER: When particular benefits are not
listed on a payment schedule.
Question 4: All of the following are non-forfeiture options
EXCEPT
CORRECT ANSWER : Cash dividend option.
Question 5: What happens when the lifetime maximum
benefit limit has been reached?
CORRECT ANSWER : The insured will pay all of the
remaining medial costs for as long as the policy is in force.
Question 6: Whose responsibility is it to make sure that the
company is notified of a death claim at the earliest possible opportunity (in most cases)?
CORRECT ANSWER : The producer.
Question 7: What is the waiver of premium provision?
CORRECT ANSWER : In a long term care contract, the
premium is waived after the insured has been confined for a specific period of time.
Question 8: All of the following are common exclusions from
loss found in disability income policies EXCEPT for that incurred while?
CORRECT ANSWER : Committing a misdemeanor
Question 9: Which is a disadvantage to a flexible premium
annuity?
CORRECT ANSWER : The actual amount of the annuity
benefit cannot be determined in advance.
Question 10: What does coinsurance mean?
CORRECT ANSWER : The insurer and the insured share
expenses over the deductible.
Question 11: Under normal conditions which of the following
is TRUE for proof of loss when a single loss is claimed?
CORRECT ANSWER : The insured has 90 days from the
date of loss to provide proof of loss.
Question 12: Which one of the following represents an
advantage of obtaining a policy loan versus a withdrawal?
CORRECT ANSWER : The loan is not taxed while a
withdrawal is taxed for amounts above the contract cost basis.
Question 13: All of the following statements define
preexisting conditions EXCEPT?
CORRECT ANSWER : Any chronic health condition that
presents symptoms and which was unknown at the time of application.
Question 14: Which is the difference between participating
and non-participating?
CORRECT ANSWER : Participating policies pay dividends
while non-participating policies do not.
Question 15: How does the per captia rule apply to proceeds
from a life insurance policy?
CORRECT ANSWER : The proceeds are divided equally
among living primary beneficiaries.