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PSI Life Insurance Exam 2025 | Latest
Exam Questions With 100% Verified
Which of the following is NOT an option for the use of the policy dividends? -
Answers Correct-answer-Fund the distribution of monthly income payments.
The insured is totally and permanently disabled. The insured's policy continues in
force without payment of further premiums because the policy contains a -
Correct-answer-Waiver of premium provision
The payer rider on a juvenile life policy provides that if the payer dies or becomes
disabled before the insured juvenile reaches the age specified in the policy that
the - Correct-answer-Insurer will make the payment until the insured juvenile
reaches a specified age-usually twenty one or twenty five
Your client has just bought a new home which he has financed with a $150,000,
7.5% interest, 30-year bank loan. He would like to be sure that if he dies that the
unpaid balance of the mortgage would be paid. He wants a policy that will cover
the mortgage balance-no more, no less anytime during the life of the mortgage.
Which of the following contracts provides benefits that fluctuate automatically Which policy is designed to meet this need? - Correct-answer-Decreasing term
with investment results - Correct-answer-Variable life insurance policy
The theory of probability is applied to life insurance through the use of - Correct- Death benefits that are received by a beneficiary are generally - Correct-answer-
answer-Mortality tables Exempt from federal income tax.
what is the difference between deferred annuities and immediate annuities? - An insured replaced an existing annuity with a new one and must pay a surrender
Correct-answer-Deferred annuities have longer accumulation periods charge for cancelling the existing annuity. The new policy folds no greater
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financial benefits to the insured than the existing contract. This is an example of -
Correct-answer-An unnecessary replacement
All life insurance policy dividend is - Correct-answer-Legally defined as a return of
excess premium and not taxable.
What do we call the process whereby insurers decide which customers to insure
and what coverage to offer - Correct-answer-Underwriting
Life insurance policies written without a physical examination are called - Correct-
answer-Non-medical
What is used to determine the amount of an annuity distribution that is exempt
from taxation - Correct-answer-The exclusion ratio
Why is the delivery of a life insurance policy important? - Correct-answer-The
free-look period begins on the policy delivery date
The number of deaths during a year compared with the total number of persons
exposed in the class is known as the - Correct-answer-Mortality rate
What is an ESOP? - Correct-answer-Employee Stock Ownership plan
The insurer bought an annuity ten years ago. He will retire in five years. To
determine the value of his annuity, he must multiple the value of the
"accumulation units" he owns, times the value of the "separate account". This Which policy provision protects the insurer against possible adverse selection? -
type of annuity is known as a - Correct-answer-Variable annuity Correct-answer-Suicide clause
All of the following are true about term life insurance policies EXCEPT the - An insured replaces an exciting annuity with a new one and must pay a surrender
Correct-answer-Face amount is paid if the insured survives to the end of the charge for cancelling the existing annuity. The new policy holds no greater
policy period.
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financial benefits to the insured than the existing contract. This is an example of -
Correct-answer-An unnecessary replacement
A husband and wife have a disabled child who is financially dependent upon
them. The death of one parent would not result in financial disaster for the
disabled child, but the death of both parents would. Which policy should they
purchase? - Correct-answer-Second-to-die policy
A group life policy is issued on a contributory basis. This means that the - Correct-
answer-Insured employees will pay part of the premium.
How can partners guarantee a market for their share of the business in the event
of death? - Correct-answer-Buy sell agreements
What is the penalty tax imposed on amount received from a modified
endowment contract? - Correct-answer-10%
Which policy covering two or more individuals terminates after paying benefits on
the first to die? - Correct-answer-Joint life policy
A participating life insurance policy is defined as a contract that - Correct-answer-
Allows the policyowner to receive a shar of a surplus in the form of policy
dividends
The accidental benefit rider is also known as - Correct-answer-Double indemnity
All of the following are contained in a mortality table EXCEPT - Correct-answer-
Number living at the end of designated year
The use of non-medical life insurance accomplishes all of the following EXCEPT -
Correct-answer-Insureds can avoid answering medical question on the application
Which policy pays the face amount if the insured survives to the end of a certain
period? - Correct-answer-Endowment insurance
Who MUST sign a statement acknowledging that a life insurance policy illustration
was given to an applicants? - Correct-answer-Th applicant and the agent
PSI Life Insurance Exam 2025 | Latest
Exam Questions With 100% Verified
Which of the following is NOT an option for the use of the policy dividends? -
Answers Correct-answer-Fund the distribution of monthly income payments.
The insured is totally and permanently disabled. The insured's policy continues in
force without payment of further premiums because the policy contains a -
Correct-answer-Waiver of premium provision
The payer rider on a juvenile life policy provides that if the payer dies or becomes
disabled before the insured juvenile reaches the age specified in the policy that
the - Correct-answer-Insurer will make the payment until the insured juvenile
reaches a specified age-usually twenty one or twenty five
Your client has just bought a new home which he has financed with a $150,000,
7.5% interest, 30-year bank loan. He would like to be sure that if he dies that the
unpaid balance of the mortgage would be paid. He wants a policy that will cover
the mortgage balance-no more, no less anytime during the life of the mortgage.
Which of the following contracts provides benefits that fluctuate automatically Which policy is designed to meet this need? - Correct-answer-Decreasing term
with investment results - Correct-answer-Variable life insurance policy
The theory of probability is applied to life insurance through the use of - Correct- Death benefits that are received by a beneficiary are generally - Correct-answer-
answer-Mortality tables Exempt from federal income tax.
what is the difference between deferred annuities and immediate annuities? - An insured replaced an existing annuity with a new one and must pay a surrender
Correct-answer-Deferred annuities have longer accumulation periods charge for cancelling the existing annuity. The new policy folds no greater
,3|Page 4|Page
financial benefits to the insured than the existing contract. This is an example of -
Correct-answer-An unnecessary replacement
All life insurance policy dividend is - Correct-answer-Legally defined as a return of
excess premium and not taxable.
What do we call the process whereby insurers decide which customers to insure
and what coverage to offer - Correct-answer-Underwriting
Life insurance policies written without a physical examination are called - Correct-
answer-Non-medical
What is used to determine the amount of an annuity distribution that is exempt
from taxation - Correct-answer-The exclusion ratio
Why is the delivery of a life insurance policy important? - Correct-answer-The
free-look period begins on the policy delivery date
The number of deaths during a year compared with the total number of persons
exposed in the class is known as the - Correct-answer-Mortality rate
What is an ESOP? - Correct-answer-Employee Stock Ownership plan
The insurer bought an annuity ten years ago. He will retire in five years. To
determine the value of his annuity, he must multiple the value of the
"accumulation units" he owns, times the value of the "separate account". This Which policy provision protects the insurer against possible adverse selection? -
type of annuity is known as a - Correct-answer-Variable annuity Correct-answer-Suicide clause
All of the following are true about term life insurance policies EXCEPT the - An insured replaces an exciting annuity with a new one and must pay a surrender
Correct-answer-Face amount is paid if the insured survives to the end of the charge for cancelling the existing annuity. The new policy holds no greater
policy period.
, 5|Page 6|Page
financial benefits to the insured than the existing contract. This is an example of -
Correct-answer-An unnecessary replacement
A husband and wife have a disabled child who is financially dependent upon
them. The death of one parent would not result in financial disaster for the
disabled child, but the death of both parents would. Which policy should they
purchase? - Correct-answer-Second-to-die policy
A group life policy is issued on a contributory basis. This means that the - Correct-
answer-Insured employees will pay part of the premium.
How can partners guarantee a market for their share of the business in the event
of death? - Correct-answer-Buy sell agreements
What is the penalty tax imposed on amount received from a modified
endowment contract? - Correct-answer-10%
Which policy covering two or more individuals terminates after paying benefits on
the first to die? - Correct-answer-Joint life policy
A participating life insurance policy is defined as a contract that - Correct-answer-
Allows the policyowner to receive a shar of a surplus in the form of policy
dividends
The accidental benefit rider is also known as - Correct-answer-Double indemnity
All of the following are contained in a mortality table EXCEPT - Correct-answer-
Number living at the end of designated year
The use of non-medical life insurance accomplishes all of the following EXCEPT -
Correct-answer-Insureds can avoid answering medical question on the application
Which policy pays the face amount if the insured survives to the end of a certain
period? - Correct-answer-Endowment insurance
Who MUST sign a statement acknowledging that a life insurance policy illustration
was given to an applicants? - Correct-answer-Th applicant and the agent
