PSI - NY Life, Accident and Health Practice
Exam 2026 Complete Practice Exam with
Questions, ANSWER-s, and Detailed
Rationales!!! 2026
Question 1
Which policy provision permits the policy owner to take a specified number of days to examine the
contract, and allows for cancellation and a full refund if the policy owner rejects the terms or costs?
A) Grace Period
B) Free Look
C) Incontestability
D) Reinstatement
Correct ANSWER✔✨-: B) Free Look
Rationale:
A) Grace Period - Incorrect. The grace period is the time after a premium due date during which the
policy remains in force even though the premium has not been paid. It does not allow for examination
and cancellation of the policy.
B) Free Look - Correct. The free look provision gives the policyowner a specified period (typically 10-30
days depending on state law) to examine the policy and return it for a full refund if they are not satisfied
with the terms or costs.
C) Incontestability - Incorrect. The incontestability provision prevents the insurer from contesting the
policy after it has been in force for a specified period (usually 2 years), except for certain exceptions like
fraud.
D) Reinstatement - Incorrect. Reinstatement allows a lapsed policy to be put back in force under certain
conditions, not the examination and cancellation of a new policy.
,Question 2
When will a policy pay on a UCR (Usual, Customary, and Reasonable) basis?
A) When the provider is in-network
B) When particular benefits are not listed on a payment schedule
C) When the insured requests it
D) Only for emergency services
Correct ANSWER✔✨-: B) When particular benefits are not listed on a payment schedule
Rationale:
A) When the provider is in-network - Incorrect. In-network providers typically have negotiated fee
schedules, not UCR payments.
B) When particular benefits are not listed on a payment schedule - Correct. UCR basis is used when
specific benefits are not listed on a predetermined payment schedule, allowing payment based on what
is usual, customary, and reasonable in the geographic area.
C) When the insured requests it - Incorrect. The insured cannot arbitrarily request UCR payment; it's
determined by the policy terms and benefit structure.
D) Only for emergency services - Incorrect. While emergency services may be paid on a UCR basis, this is
not the only situation where UCR applies.
Question 3
Which type of rider reimburses health and social service expenses incurred in a convalescent or nursing
home facility?
A) Waiver of Premium rider
B) Accidental Death rider
C) Long Term Care rider
D) Guaranteed Insurability rider
Correct ANSWER✔✨-: C) Long Term Care rider
Rationale:
A) Waiver of Premium rider - Incorrect. This rider waives premium payments if the insured becomes
disabled, but does not cover nursing home expenses.
B) Accidental Death rider - Incorrect. This rider provides additional death benefits if death occurs due to
an accident, not long-term care expenses.
,C) Long Term Care rider - Correct. A Long Term Care rider specifically provides benefits for health and
social services needed in convalescent or nursing home facilities, as well as other long-term care
settings.
D) Guaranteed Insurability rider - Incorrect. This rider allows the insured to purchase additional
coverage at specified times without evidence of insurability.
Question 4
Which of the following is exempted from the incontestability provision in insurance policies?
A) Age misstatement
B) Fraudulent misstatements
C) Minor errors in address
D) Change in occupation
Correct ANSWER✔✨-: B) Fraudulent misstatements
Rationale:
A) Age misstatement - Incorrect. Age misstatements are typically adjusted by changing the benefit
amount or premium, but they don't make the policy contestable after the incontestability period.
B) Fraudulent misstatements - Correct. Fraudulent misstatements are generally exempt from the
incontestability provision, meaning the insurer can contest the policy even after the incontestability
period has expired.
C) Minor errors in address - Incorrect. These are administrative errors that don't affect the validity of the
policy and are not grounds for contesting.
D) Change in occupation - Incorrect. Changes in occupation after policy issuance don't affect the
incontestability provision.
Question 5
What is the primary purpose of the Entire Contract provision in an insurance policy?
A) To prevent changes to the policy unless agreed to by both parties
B) To specify the policy's effective date
C) To list all beneficiaries
D) To define the grace period
Correct ANSWER✔✨-: A) To prevent changes to the policy unless agreed to by both parties
Rationale:
, A) To prevent changes to the policy unless agreed to by both parties - Correct. The Entire Contract
provision states that the policy and the application constitute the entire contract, preventing either
party from claiming there were other agreements or changes not included in the written contract.
B) To specify the policy's effective date - Incorrect. The effective date is specified elsewhere in the
policy, not in the Entire Contract provision.
C) To list all beneficiaries - Incorrect. Beneficiaries are listed in the beneficiary designation section, not in
the Entire Contract provision.
D) To define the grace period - Incorrect. The grace period is defined in its own separate provision.
Question 6
In New York, how long is the standard free look period for life insurance policies?
A) 5 days
B) 10 days
C) 15 days
D) 30 days
Correct ANSWER✔✨-: B) 10 days
Rationale:
A) 5 days - Incorrect. This is too short for New York's requirements.
B) 10 days - Correct. New York requires a minimum 10-day free look period for life insurance policies,
though some policies may have longer periods.
C) 15 days - Incorrect. While some states may have 15-day periods, New York's standard is 10 days.
D) 30 days - Incorrect. While some specific policies or situations may have 30-day periods, the standard
in New York is 10 days.
Question 7
Which of the following best describes "insurable interest" in life insurance?
A) The policyowner must have a financial or emotional interest in the continued life of the insured
B) The insured must own the policy
C) The beneficiary must pay the premiums
D) The insurer must have interest in collecting premiums
Correct ANSWER✔✨-: A) The policyowner must have a financial or emotional interest in the
continued life of the insured
Rationale:
Exam 2026 Complete Practice Exam with
Questions, ANSWER-s, and Detailed
Rationales!!! 2026
Question 1
Which policy provision permits the policy owner to take a specified number of days to examine the
contract, and allows for cancellation and a full refund if the policy owner rejects the terms or costs?
A) Grace Period
B) Free Look
C) Incontestability
D) Reinstatement
Correct ANSWER✔✨-: B) Free Look
Rationale:
A) Grace Period - Incorrect. The grace period is the time after a premium due date during which the
policy remains in force even though the premium has not been paid. It does not allow for examination
and cancellation of the policy.
B) Free Look - Correct. The free look provision gives the policyowner a specified period (typically 10-30
days depending on state law) to examine the policy and return it for a full refund if they are not satisfied
with the terms or costs.
C) Incontestability - Incorrect. The incontestability provision prevents the insurer from contesting the
policy after it has been in force for a specified period (usually 2 years), except for certain exceptions like
fraud.
D) Reinstatement - Incorrect. Reinstatement allows a lapsed policy to be put back in force under certain
conditions, not the examination and cancellation of a new policy.
,Question 2
When will a policy pay on a UCR (Usual, Customary, and Reasonable) basis?
A) When the provider is in-network
B) When particular benefits are not listed on a payment schedule
C) When the insured requests it
D) Only for emergency services
Correct ANSWER✔✨-: B) When particular benefits are not listed on a payment schedule
Rationale:
A) When the provider is in-network - Incorrect. In-network providers typically have negotiated fee
schedules, not UCR payments.
B) When particular benefits are not listed on a payment schedule - Correct. UCR basis is used when
specific benefits are not listed on a predetermined payment schedule, allowing payment based on what
is usual, customary, and reasonable in the geographic area.
C) When the insured requests it - Incorrect. The insured cannot arbitrarily request UCR payment; it's
determined by the policy terms and benefit structure.
D) Only for emergency services - Incorrect. While emergency services may be paid on a UCR basis, this is
not the only situation where UCR applies.
Question 3
Which type of rider reimburses health and social service expenses incurred in a convalescent or nursing
home facility?
A) Waiver of Premium rider
B) Accidental Death rider
C) Long Term Care rider
D) Guaranteed Insurability rider
Correct ANSWER✔✨-: C) Long Term Care rider
Rationale:
A) Waiver of Premium rider - Incorrect. This rider waives premium payments if the insured becomes
disabled, but does not cover nursing home expenses.
B) Accidental Death rider - Incorrect. This rider provides additional death benefits if death occurs due to
an accident, not long-term care expenses.
,C) Long Term Care rider - Correct. A Long Term Care rider specifically provides benefits for health and
social services needed in convalescent or nursing home facilities, as well as other long-term care
settings.
D) Guaranteed Insurability rider - Incorrect. This rider allows the insured to purchase additional
coverage at specified times without evidence of insurability.
Question 4
Which of the following is exempted from the incontestability provision in insurance policies?
A) Age misstatement
B) Fraudulent misstatements
C) Minor errors in address
D) Change in occupation
Correct ANSWER✔✨-: B) Fraudulent misstatements
Rationale:
A) Age misstatement - Incorrect. Age misstatements are typically adjusted by changing the benefit
amount or premium, but they don't make the policy contestable after the incontestability period.
B) Fraudulent misstatements - Correct. Fraudulent misstatements are generally exempt from the
incontestability provision, meaning the insurer can contest the policy even after the incontestability
period has expired.
C) Minor errors in address - Incorrect. These are administrative errors that don't affect the validity of the
policy and are not grounds for contesting.
D) Change in occupation - Incorrect. Changes in occupation after policy issuance don't affect the
incontestability provision.
Question 5
What is the primary purpose of the Entire Contract provision in an insurance policy?
A) To prevent changes to the policy unless agreed to by both parties
B) To specify the policy's effective date
C) To list all beneficiaries
D) To define the grace period
Correct ANSWER✔✨-: A) To prevent changes to the policy unless agreed to by both parties
Rationale:
, A) To prevent changes to the policy unless agreed to by both parties - Correct. The Entire Contract
provision states that the policy and the application constitute the entire contract, preventing either
party from claiming there were other agreements or changes not included in the written contract.
B) To specify the policy's effective date - Incorrect. The effective date is specified elsewhere in the
policy, not in the Entire Contract provision.
C) To list all beneficiaries - Incorrect. Beneficiaries are listed in the beneficiary designation section, not in
the Entire Contract provision.
D) To define the grace period - Incorrect. The grace period is defined in its own separate provision.
Question 6
In New York, how long is the standard free look period for life insurance policies?
A) 5 days
B) 10 days
C) 15 days
D) 30 days
Correct ANSWER✔✨-: B) 10 days
Rationale:
A) 5 days - Incorrect. This is too short for New York's requirements.
B) 10 days - Correct. New York requires a minimum 10-day free look period for life insurance policies,
though some policies may have longer periods.
C) 15 days - Incorrect. While some states may have 15-day periods, New York's standard is 10 days.
D) 30 days - Incorrect. While some specific policies or situations may have 30-day periods, the standard
in New York is 10 days.
Question 7
Which of the following best describes "insurable interest" in life insurance?
A) The policyowner must have a financial or emotional interest in the continued life of the insured
B) The insured must own the policy
C) The beneficiary must pay the premiums
D) The insurer must have interest in collecting premiums
Correct ANSWER✔✨-: A) The policyowner must have a financial or emotional interest in the
continued life of the insured
Rationale:
