CA PSI SITE - LIFE, ACCIDENT AND HEALTH AGENT

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CA PSI SITE - LIFE, ACCIDENT AND HEALTH AGENT

EXAMINATION (LIFE AGENT)

Actual Qs and Ans - Expert-Verified Explanation -Guaranteed passing score -100 Questions and Answers

-Format: Multiple-choice / Flashcard

Question 1: In replacement, an existing insurer must provide policyowners with a policy summary for existing Life Insurance within how many days of receiving the written communication and replacement?

• 31 days
• 5 days
• 60 days
• 15 days

Answer:

B Question 2: The Commissioner must examine the affairs, transactions, accounts, records, and

assets of each domestic insurer at least every:

• 3 years
• 5 years
• 2 years
• 1 year

Answer:

B

Question 3: Preferred Provider Organizations (PPO)

Answer:

An Preferred Provider Organizations (PPO) is an arrangement under which a selected group of independent hospitals and medical practitioners become preferred providers in a geographic area.

• Providers perform services to subscribers and charge a discounted fee-for-service negotiated in

advanced.

• The contracting agency or organizer of a PPO might be a commercial insurance company, Blue

Cross/Blue Shield, local group of hospitals or physicians, an HMO, large employers, or trade unions.

• PPOs share the concept of cost reduction by health care management and differ from HMOs in that

PPOs do not have separate physical facilities and not as capable of controlling expenses other than negotiating standard fees for services with its network provider.

Question 4: Exclusive Provider Organization (EPO)

Answer:

An EPO is a type of PPO that REQUIRES a subscriber to seek treatment from a limited number of network providers.

Question 5: Grace Period

Answer:

The grace period is the time period provided after the premium due dates before a policy lapses.

• The grace period in California is 60 days.

Question 6: To protect (subject to statutory limitations) life and health owners and insureds in the event of impairment or insolvency of a member insurer. This is a description of:

• Medi-Cal
• The California Life and Health Insurance Guarantee Association

C. OBRA

• None of the above

Answer:

The California Life and Health Insurance Guarantee Association

Question 7: Ben is a life agent who would like to do business with the rock Solid Insurance Company but he doesn't have an appointment to sell their policies. Assuming Rock solid does not require exclusive representation, can Ben submit an application to them from a prospect ?

• No, appointments are always required to be filed prior to submitting applications.
• Yes, and the application need not be approved by the underwriting department.
• Yes, and if the insurer approves the application they must appoint Ben within 14 days.
• All the above are false.

Answer:

C Question 8: Disability income insurance offers various riders to supplement benefits from these

policies. The Social Security rider:

Answer:

Helps establish a limit for the amount of income benefits paid to an insured who will receive substantial benefits that may or may not be paid from government programs.

Question 9: Joint Life

Answer:

Joint Life (First to Die) is a whole life policy that is written to cover 2 or more lives.

• The death benefit is paid upon the first insured to die and the policy terminates.

Question 10: There are four basic classes of life insurance. All of the selections listed below are

regarded as ordinary insurance, except:

• A life paid-up-at-age-55 policy
• A 10-year endowment contract
• A group life insurance policy
• Term life insurance policy

Answer:

C

Question 11: All the following are factors in determining premiums charged for group disability

income insurance, except:

• The average age of all members of the group
• The location of the insured
• How long of a waiting or elimination period the policy reflects
• How long the benefits will play

Answer:

B

Question 12: Disability Income Rider

Answer:

Life Insurance Disability Rider In the event of total disability and after the initial waiting period (such as 6 months), premiums are waived and the insured is paid a monthly income.The monthly disability income benefit is typically limited to a percentage of the face value.The benefit paid from the rider does not reduce the death benefits paid out upon death.

Question 13: Separate Account (Variable) vs General Account (Life Insurance)

Answer:

The separate account is invested in debt or equity securities as offered by the insurance company.

• Both the cash value in the separate account and the death benefit will fluctuate based on market

conditions and performance of the subaccounts.

• There is no guaranteed minimum return on the cash value in the separate account and the policy may

lose both cash value and death benefit if there are market losses.

• The death benefit is recalculated annually.

The general account provides a fixed rate of interest and the cash value in the general account provides for a guaranteed minimum death benefit.Question 14: A policy owner makes the last premium payment on his $250,000 non-par whole life policy today. The owner is 70 years of age. When will the cash value reach $250,000.

• About 13 years from now
• The cash value is $250,000 today
• Never, he didn't pay up to age 100
• When he reaches the age of 100