PSI TEST PREP STUDY FOR PMHC EXAM 2025
COMPLETE EXAM QUESTIONS AND ACCURATE
ANSWERS |ALREADY PASSED!!
Policy - (ANSWER)A contract between the insurer and the insured outlining
terms of coverage.
Premium - (ANSWER)The amount the insured pays for insurance coverage.
Deductible - (ANSWER)The amount the insured must pay out-of-pocket before
the insurer pays a claim.
Coverage - (ANSWER)The protection provided by an insurance policy.
Claim - (ANSWER)A request made by the insured for payment of a loss covered
by the policy.
Underwriting - (ANSWER)The process insurers use to evaluate risks and decide
terms of coverage.
Risk - (ANSWER)The chance or uncertainty of a loss.
Hazard - (ANSWER)Anything that increases the likelihood or severity of a loss.
Peril - (ANSWER)The cause of a loss (e.g., fire, theft, windstorm).
, Indemnity - (ANSWER)The principle of restoring the insured to the same financial
position as before the loss.
Limits of Liability - (ANSWER)The maximum amount an insurer will pay for a
covered loss.
Exclusion - (ANSWER)Specific conditions or circumstances for which the policy
does not provide coverage.
Endorsement (rider) - (ANSWER)An amendment or addition to a policy that
changes its terms or coverage.
Coinsurance - (ANSWER)A percentage of loss the insured must pay after the
deductible, often seen in property insurance.
Actual Cash Value (AVC) - (ANSWER)The value of property calculated as
replacement cost minus depreciation.
Replacement Cost - (ANSWER)The cost to replace damaged property with new
property of like kind and quality without deduction for depreciation.
Binder - (ANSWER)A temporary insurance contract providing proof of coverage
until a formal policy is issued.
COMPLETE EXAM QUESTIONS AND ACCURATE
ANSWERS |ALREADY PASSED!!
Policy - (ANSWER)A contract between the insurer and the insured outlining
terms of coverage.
Premium - (ANSWER)The amount the insured pays for insurance coverage.
Deductible - (ANSWER)The amount the insured must pay out-of-pocket before
the insurer pays a claim.
Coverage - (ANSWER)The protection provided by an insurance policy.
Claim - (ANSWER)A request made by the insured for payment of a loss covered
by the policy.
Underwriting - (ANSWER)The process insurers use to evaluate risks and decide
terms of coverage.
Risk - (ANSWER)The chance or uncertainty of a loss.
Hazard - (ANSWER)Anything that increases the likelihood or severity of a loss.
Peril - (ANSWER)The cause of a loss (e.g., fire, theft, windstorm).
, Indemnity - (ANSWER)The principle of restoring the insured to the same financial
position as before the loss.
Limits of Liability - (ANSWER)The maximum amount an insurer will pay for a
covered loss.
Exclusion - (ANSWER)Specific conditions or circumstances for which the policy
does not provide coverage.
Endorsement (rider) - (ANSWER)An amendment or addition to a policy that
changes its terms or coverage.
Coinsurance - (ANSWER)A percentage of loss the insured must pay after the
deductible, often seen in property insurance.
Actual Cash Value (AVC) - (ANSWER)The value of property calculated as
replacement cost minus depreciation.
Replacement Cost - (ANSWER)The cost to replace damaged property with new
property of like kind and quality without deduction for depreciation.
Binder - (ANSWER)A temporary insurance contract providing proof of coverage
until a formal policy is issued.
