Life, Accident, and Health or Sickness Examination
PSI Licensing Exam (2025)
Complete Set of Questions and Verified Answers
what is meant by referring to an insurance policy as a unilateral contract?
Only one party makes a legally enforceable promise.
When must insurance records of insurance agents and brokers be made available to the insurance
commissioner?
At all times.
Any situation that presents the possibility of a loss is known as?
a loss exposure.
Which of the following information is not required to be communicated in a Life insurance
contract?
Personal Judgement
the direct distribution of insurance utilizes all of the following to mote the sale of insurance
Except?
Telephone call from an agent.
A contract in which one party promises to indemnify another against loss that arises from an
unknown event is
an insurance policy.
All of the occurrences listed below are examples of an insurable event as defined by the
California Insurance code EXCEPT?
an insured suffers a financial loss in the state lottery.
all of the following statements about aleatory contracts are true EXCEPT?
the insured and insurer contribute equally to the contract.
all of the following would be considered unfair trade practices EXCEPT?
committing any act of discrimination whether it be deemed fair or unfair.
,As authorized by the California Insurance Code, the Insurance Commissioner has provided
standards for names used by life insurance agents. Under these standards which, if any, of the
following are automatically acceptable for Mary Brown, a holder of the CLU designation?
Mary Brown Insurance Services.
A contract of indemnity is one in which?
one party is restored to the same financial position the party was in before the loss occurred.
In insurance terminology, "indemnity means?
to make whole.
As defined in the California insurance Code, "insurance" is a?
Contract
what would a person be guilty of who refuses to deliver any books records, or assets to the
commissioner once a seizure order has been executed?
A misdemeanor.
An agent who is acting as an insurance agent, broker, solicitor, life agent, accident and health, or
bail agent acts in which capacity when handling premiums or return premiums for an insured?
fiduciary
which of the following statements regarding risk is TRUE?
Only pure risks are insurable.
the purchase of an insurance policy may accomplish all of the following Except?
the elimination of risk
Insureds are entitled to recover an amount NOT greater than the amount of their loss under the
principle of
Indemnity.
What rule is used to determine the importance of a representation?
The materiality of concealment.
The required contents of a policy include all of the following EXCEPT?
The probability of loss
All of the following are characteristics of reinsurance EXCEPT ?
Increases the unearned premium reserve
, According to the California code, an insurance policy must specify all of the Following Except?
the financial rating of the insurer
all of the following qualify as "background information" as defined in section 1729.2 of the
California Insurance Code, Except?
misdemeanor charges filed, not resulting in a conviction.
Loss retention is an effective risk management technique when all of the following conditions
exist EXCEPT the
probability of loss is unknown.
a situation in which there is a possibility of loss or a gain is a
speculative risk
Why is having a large number of similar exposure units important to insurers?
the greater the number insured, the more accurately the insurer can predict losses and set
appropriate premiums.
all of the following are benefits of insurance Except it ?
eliminates fraudulent losses.
who are members of the Medical information Bureau?
Life and Health insurers
the process by which an insurer decides whether to issue requested insurance is called?
underwriting
Unless it is merely a statement of an expectation or a belief, a representation as to the future is
considered which of the following?
Promise
Upon notification of a claim, a claimant must be given access to the California Fair Claims
Settlement Practices resolution by all of the following means EXCEPT
by interview appointment with the agent of record.
what is the definition of premium?
Money an insured pays an insurer to obtain the benefits provided in the policy.
what is the goal of the underwriting process?
to avoid selecting a disproportionate number of bad risk.
PSI Licensing Exam (2025)
Complete Set of Questions and Verified Answers
what is meant by referring to an insurance policy as a unilateral contract?
Only one party makes a legally enforceable promise.
When must insurance records of insurance agents and brokers be made available to the insurance
commissioner?
At all times.
Any situation that presents the possibility of a loss is known as?
a loss exposure.
Which of the following information is not required to be communicated in a Life insurance
contract?
Personal Judgement
the direct distribution of insurance utilizes all of the following to mote the sale of insurance
Except?
Telephone call from an agent.
A contract in which one party promises to indemnify another against loss that arises from an
unknown event is
an insurance policy.
All of the occurrences listed below are examples of an insurable event as defined by the
California Insurance code EXCEPT?
an insured suffers a financial loss in the state lottery.
all of the following statements about aleatory contracts are true EXCEPT?
the insured and insurer contribute equally to the contract.
all of the following would be considered unfair trade practices EXCEPT?
committing any act of discrimination whether it be deemed fair or unfair.
,As authorized by the California Insurance Code, the Insurance Commissioner has provided
standards for names used by life insurance agents. Under these standards which, if any, of the
following are automatically acceptable for Mary Brown, a holder of the CLU designation?
Mary Brown Insurance Services.
A contract of indemnity is one in which?
one party is restored to the same financial position the party was in before the loss occurred.
In insurance terminology, "indemnity means?
to make whole.
As defined in the California insurance Code, "insurance" is a?
Contract
what would a person be guilty of who refuses to deliver any books records, or assets to the
commissioner once a seizure order has been executed?
A misdemeanor.
An agent who is acting as an insurance agent, broker, solicitor, life agent, accident and health, or
bail agent acts in which capacity when handling premiums or return premiums for an insured?
fiduciary
which of the following statements regarding risk is TRUE?
Only pure risks are insurable.
the purchase of an insurance policy may accomplish all of the following Except?
the elimination of risk
Insureds are entitled to recover an amount NOT greater than the amount of their loss under the
principle of
Indemnity.
What rule is used to determine the importance of a representation?
The materiality of concealment.
The required contents of a policy include all of the following EXCEPT?
The probability of loss
All of the following are characteristics of reinsurance EXCEPT ?
Increases the unearned premium reserve
, According to the California code, an insurance policy must specify all of the Following Except?
the financial rating of the insurer
all of the following qualify as "background information" as defined in section 1729.2 of the
California Insurance Code, Except?
misdemeanor charges filed, not resulting in a conviction.
Loss retention is an effective risk management technique when all of the following conditions
exist EXCEPT the
probability of loss is unknown.
a situation in which there is a possibility of loss or a gain is a
speculative risk
Why is having a large number of similar exposure units important to insurers?
the greater the number insured, the more accurately the insurer can predict losses and set
appropriate premiums.
all of the following are benefits of insurance Except it ?
eliminates fraudulent losses.
who are members of the Medical information Bureau?
Life and Health insurers
the process by which an insurer decides whether to issue requested insurance is called?
underwriting
Unless it is merely a statement of an expectation or a belief, a representation as to the future is
considered which of the following?
Promise
Upon notification of a claim, a claimant must be given access to the California Fair Claims
Settlement Practices resolution by all of the following means EXCEPT
by interview appointment with the agent of record.
what is the definition of premium?
Money an insured pays an insurer to obtain the benefits provided in the policy.
what is the goal of the underwriting process?
to avoid selecting a disproportionate number of bad risk.
