CA LIFE EXAM – PSI questions and answers
/100% pass
A beneficiary receives only the death benefit earnings in which settlement option? -
Interest option
A creditor would be allowed rights to life insurance policy proceeds, if which of the following
beneficiaries is chosen? - The insured's estate
A life insurance policy can be surrendered for its cash value under which policy provision? -
Nonforfeiture options
A participating company is also referred to as which type of insurer? - Mutual insurer
A person who asserts a right of recovery under an insurance policy is called - claimant
A policy owner can receive an immediate payment before the insured dies by using a(n) -
viatical settlement contract
A report that is based on credit worthiness and personal characteristics that influences an
insurance applicant's eligibility for life and health insurance is called a(n) - Consumer
report
A representation may be altered or withdrawn - only before the insurance is in effect
,A savings vehicle designed to first accumulate funds and then systematically liquidates the funds
is called a(n) - Deferred annuity
A spendthrift clause in a life insurance policy - restricts the ability of the beneficiary to
assign benefits
A terminated employee that has exercised the conversion privilege is able to convert -
term insurance into permanent insurance
A worker is entitled to Social Security disability benefits if all of the following are true EXCEPT
for - Worker cannot perform his or her current job, but is actively seeking other
employment
According to section 1729.2 of the California Insurance Code, which of these does NOT qualify
as "background information"? - Misdemeanor charges filed, not resulting in a conviction
According to Social Security, an individual with six credits of coverage during the previous 13-
quarter period is considered to be - Currently insured
According to the California code governing claims settlement practices, which of the following is
not considered to be an act of unfair discrimination? - Denial of a claim based on reckless
behavior
According to the California Insurance Code, how is the word "may" interpreted? -
permissive
According to the California Insurance Code, what is "insurance"? - A contract
, According to the California insurance code, what is the maximum penalty per violation for
anyone who unwillfully commits an unfair method of competition? - $5,000
According to the California Insurance Code, what term is used to describe a fact so important it
could affect the policy premium? - Materiality
According to the California insurance code, which of the following is not an example of an
insurable event? - An insured suffers a financial loss in the state lottery
After a policy has lapsed, which provision allows the insurer to continue coverage -
Reinstatement provision
All of the following are considered characteristics of group, life insurance, EXCEPT -
Individual policies
All of the following circumstances must be met for los retention to be an effective, risk
management technique, except - Probability of loss is unknown
All of the following circumstances must be met for lost attention to be an effective risk
management technique, except - Probability of loss is unknown
All of these are common personal uses of life insurance EXCEPT - Fund a buy-sell
agreement
All of these reasons the commissioner may disapprove a licensee's request to use fictitious
name EXCEPT - The name is the licensee's actual name
/100% pass
A beneficiary receives only the death benefit earnings in which settlement option? -
Interest option
A creditor would be allowed rights to life insurance policy proceeds, if which of the following
beneficiaries is chosen? - The insured's estate
A life insurance policy can be surrendered for its cash value under which policy provision? -
Nonforfeiture options
A participating company is also referred to as which type of insurer? - Mutual insurer
A person who asserts a right of recovery under an insurance policy is called - claimant
A policy owner can receive an immediate payment before the insured dies by using a(n) -
viatical settlement contract
A report that is based on credit worthiness and personal characteristics that influences an
insurance applicant's eligibility for life and health insurance is called a(n) - Consumer
report
A representation may be altered or withdrawn - only before the insurance is in effect
,A savings vehicle designed to first accumulate funds and then systematically liquidates the funds
is called a(n) - Deferred annuity
A spendthrift clause in a life insurance policy - restricts the ability of the beneficiary to
assign benefits
A terminated employee that has exercised the conversion privilege is able to convert -
term insurance into permanent insurance
A worker is entitled to Social Security disability benefits if all of the following are true EXCEPT
for - Worker cannot perform his or her current job, but is actively seeking other
employment
According to section 1729.2 of the California Insurance Code, which of these does NOT qualify
as "background information"? - Misdemeanor charges filed, not resulting in a conviction
According to Social Security, an individual with six credits of coverage during the previous 13-
quarter period is considered to be - Currently insured
According to the California code governing claims settlement practices, which of the following is
not considered to be an act of unfair discrimination? - Denial of a claim based on reckless
behavior
According to the California Insurance Code, how is the word "may" interpreted? -
permissive
According to the California Insurance Code, what is "insurance"? - A contract
, According to the California insurance code, what is the maximum penalty per violation for
anyone who unwillfully commits an unfair method of competition? - $5,000
According to the California Insurance Code, what term is used to describe a fact so important it
could affect the policy premium? - Materiality
According to the California insurance code, which of the following is not an example of an
insurable event? - An insured suffers a financial loss in the state lottery
After a policy has lapsed, which provision allows the insurer to continue coverage -
Reinstatement provision
All of the following are considered characteristics of group, life insurance, EXCEPT -
Individual policies
All of the following circumstances must be met for los retention to be an effective, risk
management technique, except - Probability of loss is unknown
All of the following circumstances must be met for lost attention to be an effective risk
management technique, except - Probability of loss is unknown
All of these are common personal uses of life insurance EXCEPT - Fund a buy-sell
agreement
All of these reasons the commissioner may disapprove a licensee's request to use fictitious
name EXCEPT - The name is the licensee's actual name
