Pearson Vue Texas State Life and Health
Insurance Exam
Questions and Answers with rationales,
(A+ Guarantee)
2026\2027 update
This Exam contains:
Guarantee passing score
Questions and Ansẉers
format set of multiple-choice
Expert-Verified rationales
Verified ẉith trusted textbooks
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1. Which of the following is considered a field underwriter?
A) Actuary
B) Medical examiner
C) Insurance agent
D) Policyowner
Answer: C. Rationale: The agent is the primary field underwriter,
gathering initial information and assessing risk on-site.
2. An applicant intentionally lies about their age on an application.
This is considered:
A) Fraud
B) Misrepresentation
C) Concealment
D) Waiver
Answer: B. Rationale: Lying about a material fact like age is a
misrepresentation. If intentional, it constitutes fraud.
3. In insurance, an offer is made when:
A) The agent hands the policy to the client.
B) The applicant submits the application with the initial premium.
C) The insurer issues the policy.
D) The agent quotes a premium rate.
Answer: B. Rationale: The application and initial premium constitute
the offer. The insurer's issuance of the policy is the acceptance.
4. Which principle restores an insured to the same financial
condition they were in before a loss?
A) Subrogation
B) Adhesion
C) Indemnity
, D) Estoppel
Answer: C. Rationale: The principle of indemnity ensures an insured
does not profit from a loss but is restored to their previous financial
state.
5. An insured pays a premium that is lower than standard due to
their excellent health. What risk classification do they receive?
A) Standard
B) Preferred
C) Substandard
D) Rated
Answer: B. Rationale: Preferred risk individuals have superior health
or lifestyle and pay lower premiums.
6. What is the primary purpose of the Medical Information Bureau
(MIB)?
A) To provide medical exams for insurers
B) To prevent fraud by sharing medical history among insurers
C) To set standard premium rates
D) To regulate agent licensing
Answer: B. Rationale: The MIB is a nonprofit organization that helps
underwriters evaluate risks and prevents applicant fraud.
7. Which of the following is NOT a characteristic of an insurable
risk?
A) Loss must be catastrophic
B) Loss must be accidental
C) Loss must be measurable
D) Large number of homogeneous units
Answer: A. Rationale: Insurable risks cannot be catastrophic
(affecting a massive portion of the population at once), as insurers
must remain solvent.
8. The legal ability to enter into an insurance contract is known as:
Insurance Exam
Questions and Answers with rationales,
(A+ Guarantee)
2026\2027 update
This Exam contains:
Guarantee passing score
Questions and Ansẉers
format set of multiple-choice
Expert-Verified rationales
Verified ẉith trusted textbooks
,───────────────────────────────────────────────────────
─
1. Which of the following is considered a field underwriter?
A) Actuary
B) Medical examiner
C) Insurance agent
D) Policyowner
Answer: C. Rationale: The agent is the primary field underwriter,
gathering initial information and assessing risk on-site.
2. An applicant intentionally lies about their age on an application.
This is considered:
A) Fraud
B) Misrepresentation
C) Concealment
D) Waiver
Answer: B. Rationale: Lying about a material fact like age is a
misrepresentation. If intentional, it constitutes fraud.
3. In insurance, an offer is made when:
A) The agent hands the policy to the client.
B) The applicant submits the application with the initial premium.
C) The insurer issues the policy.
D) The agent quotes a premium rate.
Answer: B. Rationale: The application and initial premium constitute
the offer. The insurer's issuance of the policy is the acceptance.
4. Which principle restores an insured to the same financial
condition they were in before a loss?
A) Subrogation
B) Adhesion
C) Indemnity
, D) Estoppel
Answer: C. Rationale: The principle of indemnity ensures an insured
does not profit from a loss but is restored to their previous financial
state.
5. An insured pays a premium that is lower than standard due to
their excellent health. What risk classification do they receive?
A) Standard
B) Preferred
C) Substandard
D) Rated
Answer: B. Rationale: Preferred risk individuals have superior health
or lifestyle and pay lower premiums.
6. What is the primary purpose of the Medical Information Bureau
(MIB)?
A) To provide medical exams for insurers
B) To prevent fraud by sharing medical history among insurers
C) To set standard premium rates
D) To regulate agent licensing
Answer: B. Rationale: The MIB is a nonprofit organization that helps
underwriters evaluate risks and prevents applicant fraud.
7. Which of the following is NOT a characteristic of an insurable
risk?
A) Loss must be catastrophic
B) Loss must be accidental
C) Loss must be measurable
D) Large number of homogeneous units
Answer: A. Rationale: Insurable risks cannot be catastrophic
(affecting a massive portion of the population at once), as insurers
must remain solvent.
8. The legal ability to enter into an insurance contract is known as:
