PSI Practice Exam NJ Questions & Answers
1.all of the following are ownership rights EXCEPT:
A: changing the beneficiary of the policy
B: borrowing funds against cash value
C: switching the policy from on insured to another
D: assigning all of the rights of the policy to another person
Answer: C: switching the policy from on insured to another
2.which of the following is characteristic of a non qualified
plan: A: defined vesting schedule
B: plan established by the employer
C: plan does not meet federal guidelines for tax benefits
D: employer contributions are deductible business expense
Answer: C: plan does not meet federal guidelines for tax benefits
3.How do warranties differ from representations?
A: a warranty is guaranteed to be true, a representation is believed to be true
to the best of one's knowledge
B: a representation is guaranteed to be true, a warranty is believed to be true
to the best of one's knowledge
C: a warranty is issued by the insurer, a representation is a statement provide
by the applicant
D: an incorrect representation automatically voids a contract, whereas
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,an incorrect warranty must be proven:
Answer A: a warranty is guaranteed to be true, a representation is
believed to be true to the best of one's knowledge
4.in which of the following must a beneficiary change request be filed
in writing to the insurer and is made effective by the insurance
company: A: designation option
B: recording method
C: endorsement method
D: succession of beneficiaries
Answer: B: recording method
5.all of the following are required signature on a life insurance
application EXCEPT:
A: the agent
B: the applicant
C: the minor in a juvenile policy
D: the proposed insured
Answer: C: the minor in a juvenile policy
6.all of the following are features of the spendthrift clause
EXCEPT: A: proceeds are paid in some other way than a single
premium
B: proceeds are protected by the insurer from the beneficiary's creditors
C: transfer of proceeds to creditors
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, D: the beneficiary may encumber the proceeds
Answer: D: the beneficiary may encumber the proceeds
7.Which type of annuity attempts to offset inflation by providing a
benefit linked to an underlying investment account:
A: deferred
B: fixed
C: immediate
D: variable
Answer: D: variable
8.how does the per capita rule apply to proceeds from a life insurance
policy: A: the proceeds are divided equally among living primary
beneficiaries
B: the secondary beneficiary receives the proceeds if the primary beneficiary
is no longer living
C: the proceeds go to the policyholder's estate when no beneficiary is living
D: the proceeds go to the descendants of the primary beneficiaries:
Answer A: the proceeds are divided equally among living primary
beneficiaries
9.if the insurer wishes to share an applicant's HIV status, the applicant
must be given full notice of all of the following EXCEPT:
A: insurer's practices with respect to the treatment of this information
B: the applicant's right to maintain privacy
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1.all of the following are ownership rights EXCEPT:
A: changing the beneficiary of the policy
B: borrowing funds against cash value
C: switching the policy from on insured to another
D: assigning all of the rights of the policy to another person
Answer: C: switching the policy from on insured to another
2.which of the following is characteristic of a non qualified
plan: A: defined vesting schedule
B: plan established by the employer
C: plan does not meet federal guidelines for tax benefits
D: employer contributions are deductible business expense
Answer: C: plan does not meet federal guidelines for tax benefits
3.How do warranties differ from representations?
A: a warranty is guaranteed to be true, a representation is believed to be true
to the best of one's knowledge
B: a representation is guaranteed to be true, a warranty is believed to be true
to the best of one's knowledge
C: a warranty is issued by the insurer, a representation is a statement provide
by the applicant
D: an incorrect representation automatically voids a contract, whereas
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,an incorrect warranty must be proven:
Answer A: a warranty is guaranteed to be true, a representation is
believed to be true to the best of one's knowledge
4.in which of the following must a beneficiary change request be filed
in writing to the insurer and is made effective by the insurance
company: A: designation option
B: recording method
C: endorsement method
D: succession of beneficiaries
Answer: B: recording method
5.all of the following are required signature on a life insurance
application EXCEPT:
A: the agent
B: the applicant
C: the minor in a juvenile policy
D: the proposed insured
Answer: C: the minor in a juvenile policy
6.all of the following are features of the spendthrift clause
EXCEPT: A: proceeds are paid in some other way than a single
premium
B: proceeds are protected by the insurer from the beneficiary's creditors
C: transfer of proceeds to creditors
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, D: the beneficiary may encumber the proceeds
Answer: D: the beneficiary may encumber the proceeds
7.Which type of annuity attempts to offset inflation by providing a
benefit linked to an underlying investment account:
A: deferred
B: fixed
C: immediate
D: variable
Answer: D: variable
8.how does the per capita rule apply to proceeds from a life insurance
policy: A: the proceeds are divided equally among living primary
beneficiaries
B: the secondary beneficiary receives the proceeds if the primary beneficiary
is no longer living
C: the proceeds go to the policyholder's estate when no beneficiary is living
D: the proceeds go to the descendants of the primary beneficiaries:
Answer A: the proceeds are divided equally among living primary
beneficiaries
9.if the insurer wishes to share an applicant's HIV status, the applicant
must be given full notice of all of the following EXCEPT:
A: insurer's practices with respect to the treatment of this information
B: the applicant's right to maintain privacy
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