PSI Property and Casualty Practice Test – California
Exam Questions (128 terms) with Answers .
1 Can a lender, as a condition of making a loan, require that any insurance be placed through a particular
insurance agent or broker? - ansThe loan recipient may always select a particular agent or broker of their
choosing
2 A claimant can be any of the following EXCEPT - ansEXCEPT a person who is conducting an
investigation of a claim on behalf of an insurer
3 All of the following are to be specified in an insurance policy EXCEPT - ansEXCEPT the financial rating
of the insured
4 Which of the following provisions of free insurance offered as an incentive to purchase or rent property
is TRUE? - ansIt requires a separate charge or fee
5 What is the method used for placing business with the California Automobile Assigned Risk Program? -
ansThe percentage of CAARP policies required is equal to the percentage of regular insurance policies
the insurer has issued within the State
6 Whether admitted or nonadmitted, how does a "foreign" insurer differ from an "alien" or "domestic"
insurer? - ansA "foreign" insurer is organized under the laws of another state within the United States
7 All of the following are reasons employers liability insurance is needed in addition to workers'
compensation insurance EXCEPT - ansEXCEPT to pay medical bills
8 What is the purpose of the experience modification system in the California workers' compensation
experience rating system? - ansIt expresses a particular company's loss or claims history as a
percentage to all other companies in the industry
9 Which form of negotiation is covered under the definition of "transact" as applied to insurance? -
ansNegotiations preliminary to execution
10 Which type of coverage protects against loss caused by earth movement? - ansA stand-alone
Earthquake Insurance policy specifically insuring against loss caused by land subsidence
11 Which circumstances in a pretext interview determine if the questions are permissible? - ansWhen an
insured is consulted by a person who hides his true identity on purpose when fraud for a claim is
suspected
12 Which is TRUE regarding expectant or contingent interest? - ansExpectant or contingent interest does
NOT constitute insurable interest
13 "Person" means all of the following EXCEPT - ansEXCEPT an organizational trust
14 Which of the following is TRUE regarding continuing education requirements of an agent or broker? -
ansAny licensee shall satisfactorily complete 24 hours of instruction prior to license renewal.
15 Except in a case where the property is being held as a carrier or depository, what is the insurable
interest is measured by? - ansEXCEPT The extent to which the insured would be damnified by loss or
injury to the property
16 All of the following are included as definitions of "transact" as applied to insurance EXCEPT -
ansEXCEPT underwriting
17 At which point is a person licensed as a broker-agent deemed to be acting as an insurance agent? -
answhen a notice of appointment is filed with the insurance commissioner
, PSI Property and Casualty Practice Test – California
Exam Questions (128 terms) with Answers .
18 How may a license be surrendered by the insuree, or terminated by the employer? - ansPersonally
delivering the license to the insurance commissioner, or by written notice form the employer.
19 What is the punishment for a person who refuses to deliver books, records, or assets to the
commissioner when subject to a seizure order in an insolvency proceeding? - ansNot more than $1000
fine and/or 1 year imprisonment
20 Which is NOT a duty of the Workers Compensation Bureau? - ansDetermine which claims are
approved and which are denied
21 A standard fire insurance policy contains the following details EXCEPT - ansEXCEPT the address of
the insured
22 In the event of receiving notice of a claim or other claim communication, all of the following timelines
are accurate EXCEPT - ansEXCEPT every licensee or claim agent shall transmit notice of the claim to
the insurer in no more than 5 calendar days
23 All of the following are cause for cancellation of an automobile policy EXCEPT - ansEXCEPT
discovery of a criminal record for a felony
24 All of the following are requirements for determining an area that qualifies for Low Cost Automobile
Insurance EXCEPT - ansEXCEPT the number of automobile accidents that occur within the county
25 ALL of the following are examples of open policies EXCEPT - ansEXCEPT agreed value
26 The following are valid insurance classes under California Insurance Law EXCEPT - ansEXCEPT
certainty, precious metals, and gems
27 An "insurance agent" means a person authorized, by and on behalf an insurer, to transact which of the
following class of insurance? - ansAnnuities
28 All of the following are examples of representation EXCEPT - ansEXCEPT it may be altered after the
insurance is effected
29 All of the following are TRUE regarding basic property insurance EXCEPT - ansEXCEPT the
comprehensive plan covers both automobiles and risks associated with farming
30 Under the California Vehicle Code all of the following are acceptable to satisfy the Financial
Responsibility requirement EXCEPT - ansEXCEPT a company with an escrow account that is licensed to
do business in California
31 Which of the following can the insurer do if the insured intentionally conceals or misrepresents a
material fact concerning any coverage part? - ansRescind the contract
32 Who is eligible to submit applications under the California Fair Access to Insurance Requirements? -
ansAll insurers authorized to transact basic property insurance in California are able to participate
33 What is the maximum coverage allowed through the California Automobile Assigned Risk Program for
bodily injury and death? - ansThe maximum coverage per accident is limited to $30,000 of all persons as
a result of any one accident
34 How many days prior to policy expiration is an insurer required to mail a nonrenewal notice to the
named insured? - ans30 days
Exam Questions (128 terms) with Answers .
1 Can a lender, as a condition of making a loan, require that any insurance be placed through a particular
insurance agent or broker? - ansThe loan recipient may always select a particular agent or broker of their
choosing
2 A claimant can be any of the following EXCEPT - ansEXCEPT a person who is conducting an
investigation of a claim on behalf of an insurer
3 All of the following are to be specified in an insurance policy EXCEPT - ansEXCEPT the financial rating
of the insured
4 Which of the following provisions of free insurance offered as an incentive to purchase or rent property
is TRUE? - ansIt requires a separate charge or fee
5 What is the method used for placing business with the California Automobile Assigned Risk Program? -
ansThe percentage of CAARP policies required is equal to the percentage of regular insurance policies
the insurer has issued within the State
6 Whether admitted or nonadmitted, how does a "foreign" insurer differ from an "alien" or "domestic"
insurer? - ansA "foreign" insurer is organized under the laws of another state within the United States
7 All of the following are reasons employers liability insurance is needed in addition to workers'
compensation insurance EXCEPT - ansEXCEPT to pay medical bills
8 What is the purpose of the experience modification system in the California workers' compensation
experience rating system? - ansIt expresses a particular company's loss or claims history as a
percentage to all other companies in the industry
9 Which form of negotiation is covered under the definition of "transact" as applied to insurance? -
ansNegotiations preliminary to execution
10 Which type of coverage protects against loss caused by earth movement? - ansA stand-alone
Earthquake Insurance policy specifically insuring against loss caused by land subsidence
11 Which circumstances in a pretext interview determine if the questions are permissible? - ansWhen an
insured is consulted by a person who hides his true identity on purpose when fraud for a claim is
suspected
12 Which is TRUE regarding expectant or contingent interest? - ansExpectant or contingent interest does
NOT constitute insurable interest
13 "Person" means all of the following EXCEPT - ansEXCEPT an organizational trust
14 Which of the following is TRUE regarding continuing education requirements of an agent or broker? -
ansAny licensee shall satisfactorily complete 24 hours of instruction prior to license renewal.
15 Except in a case where the property is being held as a carrier or depository, what is the insurable
interest is measured by? - ansEXCEPT The extent to which the insured would be damnified by loss or
injury to the property
16 All of the following are included as definitions of "transact" as applied to insurance EXCEPT -
ansEXCEPT underwriting
17 At which point is a person licensed as a broker-agent deemed to be acting as an insurance agent? -
answhen a notice of appointment is filed with the insurance commissioner
, PSI Property and Casualty Practice Test – California
Exam Questions (128 terms) with Answers .
18 How may a license be surrendered by the insuree, or terminated by the employer? - ansPersonally
delivering the license to the insurance commissioner, or by written notice form the employer.
19 What is the punishment for a person who refuses to deliver books, records, or assets to the
commissioner when subject to a seizure order in an insolvency proceeding? - ansNot more than $1000
fine and/or 1 year imprisonment
20 Which is NOT a duty of the Workers Compensation Bureau? - ansDetermine which claims are
approved and which are denied
21 A standard fire insurance policy contains the following details EXCEPT - ansEXCEPT the address of
the insured
22 In the event of receiving notice of a claim or other claim communication, all of the following timelines
are accurate EXCEPT - ansEXCEPT every licensee or claim agent shall transmit notice of the claim to
the insurer in no more than 5 calendar days
23 All of the following are cause for cancellation of an automobile policy EXCEPT - ansEXCEPT
discovery of a criminal record for a felony
24 All of the following are requirements for determining an area that qualifies for Low Cost Automobile
Insurance EXCEPT - ansEXCEPT the number of automobile accidents that occur within the county
25 ALL of the following are examples of open policies EXCEPT - ansEXCEPT agreed value
26 The following are valid insurance classes under California Insurance Law EXCEPT - ansEXCEPT
certainty, precious metals, and gems
27 An "insurance agent" means a person authorized, by and on behalf an insurer, to transact which of the
following class of insurance? - ansAnnuities
28 All of the following are examples of representation EXCEPT - ansEXCEPT it may be altered after the
insurance is effected
29 All of the following are TRUE regarding basic property insurance EXCEPT - ansEXCEPT the
comprehensive plan covers both automobiles and risks associated with farming
30 Under the California Vehicle Code all of the following are acceptable to satisfy the Financial
Responsibility requirement EXCEPT - ansEXCEPT a company with an escrow account that is licensed to
do business in California
31 Which of the following can the insurer do if the insured intentionally conceals or misrepresents a
material fact concerning any coverage part? - ansRescind the contract
32 Who is eligible to submit applications under the California Fair Access to Insurance Requirements? -
ansAll insurers authorized to transact basic property insurance in California are able to participate
33 What is the maximum coverage allowed through the California Automobile Assigned Risk Program for
bodily injury and death? - ansThe maximum coverage per accident is limited to $30,000 of all persons as
a result of any one accident
34 How many days prior to policy expiration is an insurer required to mail a nonrenewal notice to the
named insured? - ans30 days
