USAA Licensing Exam Most Recent exam COMPLETE (2026)
EXAM Questions and Answers (Verified Answers) (Latest
Update 2026) Graded A+
USAA Licensing Exam 2025
1. Which type of insurance primarily protects against property loss or damage?
A. Health insurance
B. Property insurance
C. Life insurance
D. Liability insurance
2. The principle of “insurable interest” requires that:
A. The insured can name any beneficiary
B. The insurer can cancel anytime
C. The policyholder would suffer financial loss if the insured property or life is lost
D. Premiums are refundable
3. A policyowner transfers risk to an insurance company through:
A. Avoidance
B. Retention
C. Insurance
D. Sharing
4. Which type of life insurance provides coverage for a specified period and has no cash
value?
1
A. Whole life
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B. Universal life
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, C. Term life
D. Variable life
5. In auto insurance, which coverage pays for bodily injury the policyholder causes to
others?
A. Collision
B. Comprehensive
C. Liability
D. Uninsured motorist
6. What is the main purpose of the underwriting process?
A. Sell policies quickly
B. Increase premiums
C. Evaluate risk and determine insurability
D. Collect claims
7. A deductible in an insurance policy is best described as:
A. Amount paid by the insurer
B. Amount paid by the insured before coverage applies
C. Premium refund
D. Interest earned on cash value
8. Which policy feature allows the policyholder to borrow against the policy’s cash value?
A. Term rider
B. Cash value loan
C. Waiver of premium
D. Beneficiary designation
9. Which of the following is a principle of risk management?
2
A. Fraud
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B. Risk transfer
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, C. Overinsurance
D. Speculation
10. Which statement about liability insurance is correct?
A. It covers the insured’s own property damage
B. It covers bodily injury or property damage to others
C. It never has limits
D. It covers only intentional acts
11. An insurance policyholder stops paying premiums. What is likely to happen?
A. Policy automatically doubles
B. Policy lapses
C. Coverage increases
D. Cash value increases
12. The purpose of coinsurance in a health policy is to:
A. Increase premiums
B. Eliminate deductible
C. Share risk between insurer and insured
D. Cover cosmetic procedures
13. Which of the following is considered a hazard in insurance terms?
A. Fire damage
B. Theft
C. Slip in the kitchen due to wet floor
D. Premium
14. In insurance, the term “moral hazard” refers to:
A. Natural disasters
B. Dishonest tendencies of the insured
3
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EXAM Questions and Answers (Verified Answers) (Latest
Update 2026) Graded A+
USAA Licensing Exam 2025
1. Which type of insurance primarily protects against property loss or damage?
A. Health insurance
B. Property insurance
C. Life insurance
D. Liability insurance
2. The principle of “insurable interest” requires that:
A. The insured can name any beneficiary
B. The insurer can cancel anytime
C. The policyholder would suffer financial loss if the insured property or life is lost
D. Premiums are refundable
3. A policyowner transfers risk to an insurance company through:
A. Avoidance
B. Retention
C. Insurance
D. Sharing
4. Which type of life insurance provides coverage for a specified period and has no cash
value?
1
A. Whole life
Page
B. Universal life
EXAMPREPMASTER
, C. Term life
D. Variable life
5. In auto insurance, which coverage pays for bodily injury the policyholder causes to
others?
A. Collision
B. Comprehensive
C. Liability
D. Uninsured motorist
6. What is the main purpose of the underwriting process?
A. Sell policies quickly
B. Increase premiums
C. Evaluate risk and determine insurability
D. Collect claims
7. A deductible in an insurance policy is best described as:
A. Amount paid by the insurer
B. Amount paid by the insured before coverage applies
C. Premium refund
D. Interest earned on cash value
8. Which policy feature allows the policyholder to borrow against the policy’s cash value?
A. Term rider
B. Cash value loan
C. Waiver of premium
D. Beneficiary designation
9. Which of the following is a principle of risk management?
2
A. Fraud
Page
B. Risk transfer
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, C. Overinsurance
D. Speculation
10. Which statement about liability insurance is correct?
A. It covers the insured’s own property damage
B. It covers bodily injury or property damage to others
C. It never has limits
D. It covers only intentional acts
11. An insurance policyholder stops paying premiums. What is likely to happen?
A. Policy automatically doubles
B. Policy lapses
C. Coverage increases
D. Cash value increases
12. The purpose of coinsurance in a health policy is to:
A. Increase premiums
B. Eliminate deductible
C. Share risk between insurer and insured
D. Cover cosmetic procedures
13. Which of the following is considered a hazard in insurance terms?
A. Fire damage
B. Theft
C. Slip in the kitchen due to wet floor
D. Premium
14. In insurance, the term “moral hazard” refers to:
A. Natural disasters
B. Dishonest tendencies of the insured
3
Page
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