PSI Insurance Exam Questions & Correct Answers with Guaranteed Success (Graded A+)

PSI Insurance Exam Questions & Correct Answers with Guaranteed Success (Graded A+) What is it called when a life insurance policy pays a multiple of the coverage amount when certain types of accidents occur? - ANSWER-multiple indemnity Upon the issuance of a conditional receipt for a renewal when the premium is paid AFTER the time granted by the insurer, what is the maximum amount of time for reinstatement of the policy? - ANSWER-30 days Which of the following statements regarding a pure life annuity payout option is correct? - ANSWER-This option provides the highest monthly income. Which of the following does not apply to the time limit on certain defenses provision in health insurance policies? - ANSWER-fraudulent misstatements If an individual is insured by both their own health insurance policy and their spouse's policy, which policy pays first in the event of an illness? - ANSWER-The individual's policy pays first, the spouse's policy pays the remaining up to coverage amount. When can the premiums of an individually owned health insurance policy be deducted from the individual's income tax? - ANSWER-when the taxpayer's unreimbursed medical expenses exceed 7.5% of adjusted gross income during a taxable year When the suicide clause is inserted in a life insurance contract, death by suicide is not covered during the policy's initial - ANSWER-2-year period. Which of the following is a characteristic of Health Maintenance Organizations (HMOs)? - ANSWER-preventive care The life insurance policy will not be truly effective until all of the following occur EXCEPT - ANSWER-the producer has explained the policy to the client. Under which situation must insurable interest exist between the applicant and insured at the time of application? - ANSWER-when a third-party applicant name themselves beneficiary Which of the following is a distinguishing feature of a variable life insurance policy? - ANSWER-The cash value earnings are based on the performance of the separate account. The person who receives the benefit of an annuity is known as the - ANSWER-annuitant. Which of the following is an example of a premium payment mode? - ANSWER-annual premium payment How do most disability policies handle the case of a recurrent disability occurring at least 90 days after the first claim? - ANSWER-it must be handled as a new claim for a new period of disability, requiring a new elimination period. Which of the following is true for most comprehensive dental policies? - ANSWER-Routine care is provided without coinsurance or deductibles. Under a Medicare Supplement Policy, preexisting conditions CANNOT be excluded after how many months from the effective date of the policy? - ANSWER-6 months What does an application for insurance contractually represent for the insured? - ANSWER-an offer Which of the following is exempted from the incontestability provision in insurance policies? - ANSWER-fraudulent misstatements Which of the following may be thought of as a time deductible rather than a dollar deductible in a disability income policy because benefits are not payable during that time? - ANSWER-elimination period How long after being entitled to Social Security disability benefits will an individual be eligible to receive Medicare benefits? - ANSWER-2 years If a policy is determined to be a Modified Endowment Contract (MEC), funds received under the policy will be - ANSWER-considered taxable income first. Which type of annuity attempts to offset inflation by providing a benefit linked to an underlying investment account? - ANSWER-variable What is a MIB report? - ANSWER-medical information on an applicant for assessing life or health insurance risk Group Life Policies typically include which of the following provisions? - ANSWER-conversion privilege In a case where an individual's health is insured by both their own policy and their spouse's policy, which policy pays in the event of an illness? - ANSWER-The individual's policy pays first, the spouse's policy pays the remaining up to coverage amount. The feature of a Life Insurance Policy stating that the policy will NOT cover certain risks is known as - ANSWER- continues...