PSI: LIFE, ACCIDENT, AND HEALTH PRACTICE EXAM EXAM

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PSI: LIFE, ACCIDENT, AND HEALTH PRACTICE EXAM EXAM

QUESTIONS

Actual Qs and Ans - Expert-Verified Explanation -Guaranteed passing score -75 Questions and Answers

-Format: Multiple-choice / Flashcard

Question 1: Which of the following policy types is considered double indemnity?

Answer:

Accidental death Question 2: What happens when the lifetime maximum benefit limit has been reached?

Answer:

The insured will pay all of the remaining medial costs for as long as the policy is in force.

Question 3: Which of the following refers to how often a premium is paid?

Answer:

Mode Question 4: All of the following are requirements to qualify for Social Security disability benefits EXCEPT when

Answer:

Unable to work in occupation on which the worker was trained or educated.

Question 5: Compared to basic hospital, medical and surgical policies, which type of insurance provides broader coverage, fewer gaps, higher individual benefits, and higher policy maximums?

Answer:

Major medical insurance.Question 6: When should a buy-sell agreement include a provision for the buy-out of an owner's business interest in the event of a disability?

Answer:

When there is a buy-sell agreement funded with life insurance to buyout the interest of a deceased owner or partner.Question 7: When does insurable interest come into play in a life insurance policy?

Answer:

When the applicant for the policy is not the insured.

Question 8: What does first dollar coverage mean?

Answer:

As soon as covered medical expenses are incurred, the policy begins to pay.

Question 9: Which problem was Universal Life insurance designed to address?

Answer:

Low interest rates during periods of high inflation.Question 10: When the suicide clause is inserted in a life insurance contract, death by suicide is

not covered during the policy's initial:

Answer:

• year period

Question 11: All of the following are classifications of risk EXCEPT?

Answer:

Non-nicotine

Question 12: Which is the primary purpose of Health Reimbursement Accounts (HFAs)?

Answer:

To assist covered employees with the payment of medical expenses on a high deductible plan funded through pre-tax.

Question 13: When will a policy pay on a UCR basis?

Answer:

When particular benefits are not listed on a payment schedule.Question 14: All of the following are characteristics of variable whole life EXCEPT?

Answer:

There is no guaranteed minimum death benefit.Question 15: For an individual long-term care policy there is an annual dollar limit for tax deduction that is based on which of the following?

Answer:

Age Question 16: Which one of the following represents an advantage of obtaining a policy loan versus a withdrawal?

Answer:

The loan is not taxed while a withdrawal is taxed for amounts above the contract cost basis.

Question 17: What is the purpose of Stranger-originated life insurance (STOLI)?

Answer:

The policy is originated primarily or solely for the purpose of resale.Question 18: Which types of life policy can be continued year after year without a required medical examination but rates are dependent on the insured's current age?

Answer:

Renewable term Question 19: Under normal conditions which of the following is TRUE for proof of loss when a single loss is claimed?

Answer:

The insured has 90 days from the date of loss to provide proof of loss.

Question 20: Whose responsibility is it to make sure that the company is notified of a death claim at the earliest possible opportunity (in most cases)?

Answer:

The producer.Question 21: Obtaining consumer information reports under false pretenses is prosecutable by which of the following?

Answer:

Fair Credit Reporting Act Question 22: Which of the following occurs immediately after the application is submitted and the initial premium paid?

Answer:

The underwriting process begins.Question 23: When can the premiums of an individually owned health insurance policy be deducted from the individual's income tax?

Answer:

When the taxpayer's medical expenses exceed 7.5% of adjusted gross income during a taxable year.

Question 24: Which of the following is TRUE of an equity-indexed annuity?

Answer:

It has a guaranteed minimum interest rate.Question 25: Under which situation must insurable interest exist between the applicant and insured at the time of application?

Answer:

When a third-party application names themselves beneficiary.Question 26: Current assumption whole life policies are sensitive to which of the following?

Answer:

Interest rates