PSI PROPERTY AND CASUALTY
PRACTICE TEST - CALIFORNIA
1.-How-does-an-"admitted"-person-differ-from-a-"non-admitted"-person,-as-it-pertains-to-
insurance?---ans-✔✔o-An-"admitted"-person-has-the-right-to-transact-insurance-business-
within-the-state,-while-a-"non-admitted"-person-is-not-entitled-to-this-action.
2.-A-claimant-can-be-any-of-the-following-EXCEPT?---ans-✔✔o-a-person-who-is-
conducting-an-investigation-of-a-claim-on-behalf-of-an-insurer.
3.-When-should-an-insurer-provide-for-the-continuous-operation-of-a-unit-or-division-to-
investigate-possible-fraudulent-claims?---ans-✔✔o-If-admitted-to-do-business-in-this-state,-
except-those-otherwise-exempted.
According-to-CIC-Section-1711,-an-organization-ceases-to-exist-as-an-entity-eligible-to-
hold-a-license-EXCEPT?---ans-✔✔o-Upon-the-termination-of-all-contracts
5.-All-of-the-following-define-insolvency-EXCEPT?---ans-✔✔o-revocation-of-certificate-of-
authority-by-the-commissioner.
6.-As-used-in-the-insurance-code,-the-word-"shall"-is-mandatory-and-the-word-"may"-is-
permissive-EXCEPT?---ans-✔✔o-unless-otherwise-apparent-from-the-context.
7.-Which-of-the-following-terms-refers-to-any-evidence-or-documentation-in-the-
possession-of-the-insurer-that-provides-any-evidence-of-a-claim-and-that-reasonably-
supports-the-magnitude-or-the-amount-of-the-claimant-loss?---ans-✔✔o-Poof-of-claim
8.-When-examination-of-an-insurer-shows-the-insurer-to-be-insolvent-and-a-danger-to-the-
public,-which-authority-is-granted-to-the-Commissioner-by-the-CIC?---ans-✔✔o-The-
commissioner-may-take-possession-of-offices,-books-and-property-immediately-without-
court-order.
9.-An-insurance-agent-is-a-person-who-transacts-all-of-the-following-types-of-insurance-
EXCEPT---ans-✔✔o-Life-insurance
10.-Which-of-the-following-is-TRUE-regarding-continuing-education-requirements-of-an-
agent-or-broker?---ans-✔✔o-Any-licensee-shall-satisfactorily-complete-24-hours-of-
instruction-prior-to-license-renewal.
, 11.-All-of-the-following-are-included-as-definitions-of-"transact"-as-applied-to-insurance-
EXCEPT?---ans-✔✔o-Underwriting
12.-Which-group-of-people-is-offered-additional-protection-by-the-Unfair-Practices-Act-that-
regulates-trade-practices-in-the-business-of-insurance?---ans-✔✔o-Survivors-of-the-
Holocaust
13.-Which-of-the-following-can-the-insurer-do-if-the-insured-intentionally-conceals-or-
misrepresents-a-material-fact-concerning-any-coverage-part?---ans-✔✔o-Rescind-the-
contract
14.-While-both-work-with-an-insurer,-how-does-an-"Insurance-broker"-differ-from-
an-"insurance-agent"?---ans-✔✔o-The-broker-does-not-transact-on-behalf-of-an-insurer,-
while-the-agent-does.
15.-How-can-a-licensee-surrender-any-license-for-cancellation?---ans-✔✔o-By-submitting-
written-notice-or-by-delivering-the-license-to-the-commissioner
16.-The-following-are-all-penalties-for-unlawfully-acting-as-an-insurer-without-a-certificate-
of-authority-EXCEPT?---ans-✔✔The-individual-will-be-banned-from-practicing-insurance-
for-a-period-of-5-years
17.-Materiality-to-be-solely-determined-by-which-of-the-following?---ans-✔✔o-The-
probable-and-reasonable-influence-of-the-facts-upon-the-party-to-whom-the-
communication-is-due
18.-What-is-a-solicitor-employed-to-do-for-a-policy-other-than-life?---ans-✔✔To-aid-a-
property-and-casualty-agent-or-broker-in-transacting-insurance.
19.-ALL-of-the-following-are-TRUE-regarding-the-process-to-change-the-California-Code-
of-Regulations-EXCEPT?---ans-✔✔o-the-Office-of-Administrative-Law-(OAL)-may-
substitute-its-own-judgment-for-that-of-the-rulemaking-agency.
20.-How-may-a-license-be-surrendered-by-the-insuree,-or-terminated-by-the-employer?---
ans-✔✔o-Personally,-delivering-the-license-to-the-insurance-commissioner,-or-by-written-
notice-from-the-employer.
21.-All-of-the-following-are-to-be-specified-in-an-insurance-policy-EXCEPT?---ans-✔✔o-
The-financial-rating-of-the-insured
22.-When-may-a-representation-be-altered-or-withdrawn?---ans-✔✔o-Before-the-
insurance-is-effected.
23.-Which-of-the-following-provisions-of-free-insurance-offered-as-an-incentive-to-
purchase-or-rent-property-is-TRUE?---ans-✔✔o-It-requires-a-separate-charge-or-fee.
PRACTICE TEST - CALIFORNIA
1.-How-does-an-"admitted"-person-differ-from-a-"non-admitted"-person,-as-it-pertains-to-
insurance?---ans-✔✔o-An-"admitted"-person-has-the-right-to-transact-insurance-business-
within-the-state,-while-a-"non-admitted"-person-is-not-entitled-to-this-action.
2.-A-claimant-can-be-any-of-the-following-EXCEPT?---ans-✔✔o-a-person-who-is-
conducting-an-investigation-of-a-claim-on-behalf-of-an-insurer.
3.-When-should-an-insurer-provide-for-the-continuous-operation-of-a-unit-or-division-to-
investigate-possible-fraudulent-claims?---ans-✔✔o-If-admitted-to-do-business-in-this-state,-
except-those-otherwise-exempted.
According-to-CIC-Section-1711,-an-organization-ceases-to-exist-as-an-entity-eligible-to-
hold-a-license-EXCEPT?---ans-✔✔o-Upon-the-termination-of-all-contracts
5.-All-of-the-following-define-insolvency-EXCEPT?---ans-✔✔o-revocation-of-certificate-of-
authority-by-the-commissioner.
6.-As-used-in-the-insurance-code,-the-word-"shall"-is-mandatory-and-the-word-"may"-is-
permissive-EXCEPT?---ans-✔✔o-unless-otherwise-apparent-from-the-context.
7.-Which-of-the-following-terms-refers-to-any-evidence-or-documentation-in-the-
possession-of-the-insurer-that-provides-any-evidence-of-a-claim-and-that-reasonably-
supports-the-magnitude-or-the-amount-of-the-claimant-loss?---ans-✔✔o-Poof-of-claim
8.-When-examination-of-an-insurer-shows-the-insurer-to-be-insolvent-and-a-danger-to-the-
public,-which-authority-is-granted-to-the-Commissioner-by-the-CIC?---ans-✔✔o-The-
commissioner-may-take-possession-of-offices,-books-and-property-immediately-without-
court-order.
9.-An-insurance-agent-is-a-person-who-transacts-all-of-the-following-types-of-insurance-
EXCEPT---ans-✔✔o-Life-insurance
10.-Which-of-the-following-is-TRUE-regarding-continuing-education-requirements-of-an-
agent-or-broker?---ans-✔✔o-Any-licensee-shall-satisfactorily-complete-24-hours-of-
instruction-prior-to-license-renewal.
, 11.-All-of-the-following-are-included-as-definitions-of-"transact"-as-applied-to-insurance-
EXCEPT?---ans-✔✔o-Underwriting
12.-Which-group-of-people-is-offered-additional-protection-by-the-Unfair-Practices-Act-that-
regulates-trade-practices-in-the-business-of-insurance?---ans-✔✔o-Survivors-of-the-
Holocaust
13.-Which-of-the-following-can-the-insurer-do-if-the-insured-intentionally-conceals-or-
misrepresents-a-material-fact-concerning-any-coverage-part?---ans-✔✔o-Rescind-the-
contract
14.-While-both-work-with-an-insurer,-how-does-an-"Insurance-broker"-differ-from-
an-"insurance-agent"?---ans-✔✔o-The-broker-does-not-transact-on-behalf-of-an-insurer,-
while-the-agent-does.
15.-How-can-a-licensee-surrender-any-license-for-cancellation?---ans-✔✔o-By-submitting-
written-notice-or-by-delivering-the-license-to-the-commissioner
16.-The-following-are-all-penalties-for-unlawfully-acting-as-an-insurer-without-a-certificate-
of-authority-EXCEPT?---ans-✔✔The-individual-will-be-banned-from-practicing-insurance-
for-a-period-of-5-years
17.-Materiality-to-be-solely-determined-by-which-of-the-following?---ans-✔✔o-The-
probable-and-reasonable-influence-of-the-facts-upon-the-party-to-whom-the-
communication-is-due
18.-What-is-a-solicitor-employed-to-do-for-a-policy-other-than-life?---ans-✔✔To-aid-a-
property-and-casualty-agent-or-broker-in-transacting-insurance.
19.-ALL-of-the-following-are-TRUE-regarding-the-process-to-change-the-California-Code-
of-Regulations-EXCEPT?---ans-✔✔o-the-Office-of-Administrative-Law-(OAL)-may-
substitute-its-own-judgment-for-that-of-the-rulemaking-agency.
20.-How-may-a-license-be-surrendered-by-the-insuree,-or-terminated-by-the-employer?---
ans-✔✔o-Personally,-delivering-the-license-to-the-insurance-commissioner,-or-by-written-
notice-from-the-employer.
21.-All-of-the-following-are-to-be-specified-in-an-insurance-policy-EXCEPT?---ans-✔✔o-
The-financial-rating-of-the-insured
22.-When-may-a-representation-be-altered-or-withdrawn?---ans-✔✔o-Before-the-
insurance-is-effected.
23.-Which-of-the-following-provisions-of-free-insurance-offered-as-an-incentive-to-
purchase-or-rent-property-is-TRUE?---ans-✔✔o-It-requires-a-separate-charge-or-fee.
