PSI CA Life, Accident, and Health License
Exam 2026 Exam question and answers latest
update 2026 RATED A+
As a life insurance agent, you know that when courts evaluate a contract to determine the parties'
intentions, they take into account specific documents. Which documents are considered in this process?
- CORRECT ANSWERS Entire contract and application
According to the California Insurance Code, what is "insurance"? - CORRECT ANSWERS A
contract
In a life insurance contract, what term describes the combined policy and application as a
comprehensive agreement between the policyowner and the insurer? - CORRECT ANSWERS
Entire Contract Provison
Which whole life policy premium type is the most common? - CORRECT ANSWERS continuous
premium
All life insurance and health insurance contracts contain all of the following EXCEPT - CORRECT
ANSWERS Representations
An insurer that has been found using higher rates based on race,religion, or ethnicity is said to be
engaging in - CORRECT ANSWERS unfair discrimination
The California Insurance Code defines "policy" as a(n) - CORRECT ANSWERS written contract
what is the definition of premium? - CORRECT ANSWERS Money an insured pays an insurer to
obtain the benefits provided in the policy.
,What is the primary source of information used by insurers to assess risk and determine premiums in
life, accident, and health insurance? - CORRECT ANSWERS Application
How does an "admitted" person differ from an "nonadmitted" person, as it pertains to insurance? -
CORRECT ANSWERS An "admitted" person has the right to transact insurance business within
the state, while a "nonadmitted" person is not entitled to this action.
As a broker, you are assisting your client in finding appropriate insurance coverage. In order to ensure
that the company offering the insurance is authorized to do so in their state, you should look for a(an) -
CORRECT ANSWERS admitted insurer.
An insurer entitled to transact business by complying with the California Insurance Code is known as a: -
CORRECT ANSWERS admitted insurer.
A Canadian insurer that benefits shareholders and is approved to operate in a U.S. state would be
classified as which type of insurer? - CORRECT ANSWERS Admitted Alien Stock Company
Which is the difference between participating and non-participating policies? - CORRECT ANSWERS
Participating policies pay dividends while non-participating policies do not.
John owns an insurance company that gives him the right to share and then share surplus. What kind of
policy is this? - CORRECT ANSWERS Participating
When a mutual insurer becomes a stock company, the process is called - CORRECT ANSWERS
Demutualization
A person who asserts a right of recovery under an insurance policy is called a - CORRECT ANSWERS
claimant
,In California, an insurer organized under the state laws of Oregon is called a(n) - CORRECT ANSWERS
foreign insurer
Under the California Insurance Code, a licensee's license number must be printed at what size on all
price quotes, business cards, and printed material? - CORRECT ANSWERS The same size print
as the licensee's phone number, fax number or address
As an insurance agent, you are convicted of a crime involving dishonesty or breach of trust. To continue
working in the industry, you must obtain written consent from an insurance regulatory official according
to which federal law? - CORRECT ANSWERS 18 USC Sections 1033 and 1034
According to the California insurance code, the commissioner can disapprove a licensee's request to use
a fictitious name for any of the following reasons EXCEPT that the - CORRECT ANSWERS name
is the licensee's actual name
all of the following are requirements of contract EXCEPT - CORRECT ANSWERS there must be
equal consideration between the parties
If an insurer must have its rates accepted by the insurance Department prior to using them, the insurer
would be operating in which of the following types of jurisdictions? - CORRECT ANSWERS
prior approval
it is federal offense for an insurance agent to do all of the following EXCEPT - CORRECT ANSWERS
misrepresent facts on an insurance application
How often MUST an insurer file the National Association of Insurance Commissioners (NAIC) financial
statement? - CORRECT ANSWERS annually
According to the California Insurance Code, what is the maximum penalty per violation for anyone who
unwilfully commits an unfair method of competition? - CORRECT ANSWERS $5,000
, Section 1729.2 of the California Insurance Code requires insurance producer applications and licensees
to notify the Insurance Commissioner in writing, within ___days of charges in background information
after an application has been submitted or a license has been issued. - CORRECT ANSWERS 30
How long must life agents keep the transaction records? - CORRECT ANSWERS 5 years
What is required after a life agent sells an insurance policy to an applicant without being appointed by
the insurer? - CORRECT ANSWERS Notice of appointment must be submitted to the
Commissioner
Anyone employed in California to assist an insurance agent in transacting insurance is called an
insurance - CORRECT ANSWERS solicitor
The California insurance code has authorized standards for names used by life insurance agents. Which
of the following, if any, are automatically acceptable for Lance Manyon, a holder of the CLU
designation? - CORRECT ANSWERS Lance Manyon, CLU
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? - CORRECT ANSWERS
Mary Brown, CLU Insurance services
according to the California insurance code, if an insurer's certificate of authority is revoked, the
Commissioner can proceed with any of the following EXCEPT - CORRECT ANSWERS using
Guarantee Funds to pay salaries
Pete is a life agent who has misappropriated fiduciary funds to his own use. What is Pete guilty of? -
CORRECT ANSWERS Fiduciary misappropriation
According to the California Insurance Code, how is the word "may" interpreted? - CORRECT ANSWERS
permissive
Exam 2026 Exam question and answers latest
update 2026 RATED A+
As a life insurance agent, you know that when courts evaluate a contract to determine the parties'
intentions, they take into account specific documents. Which documents are considered in this process?
- CORRECT ANSWERS Entire contract and application
According to the California Insurance Code, what is "insurance"? - CORRECT ANSWERS A
contract
In a life insurance contract, what term describes the combined policy and application as a
comprehensive agreement between the policyowner and the insurer? - CORRECT ANSWERS
Entire Contract Provison
Which whole life policy premium type is the most common? - CORRECT ANSWERS continuous
premium
All life insurance and health insurance contracts contain all of the following EXCEPT - CORRECT
ANSWERS Representations
An insurer that has been found using higher rates based on race,religion, or ethnicity is said to be
engaging in - CORRECT ANSWERS unfair discrimination
The California Insurance Code defines "policy" as a(n) - CORRECT ANSWERS written contract
what is the definition of premium? - CORRECT ANSWERS Money an insured pays an insurer to
obtain the benefits provided in the policy.
,What is the primary source of information used by insurers to assess risk and determine premiums in
life, accident, and health insurance? - CORRECT ANSWERS Application
How does an "admitted" person differ from an "nonadmitted" person, as it pertains to insurance? -
CORRECT ANSWERS An "admitted" person has the right to transact insurance business within
the state, while a "nonadmitted" person is not entitled to this action.
As a broker, you are assisting your client in finding appropriate insurance coverage. In order to ensure
that the company offering the insurance is authorized to do so in their state, you should look for a(an) -
CORRECT ANSWERS admitted insurer.
An insurer entitled to transact business by complying with the California Insurance Code is known as a: -
CORRECT ANSWERS admitted insurer.
A Canadian insurer that benefits shareholders and is approved to operate in a U.S. state would be
classified as which type of insurer? - CORRECT ANSWERS Admitted Alien Stock Company
Which is the difference between participating and non-participating policies? - CORRECT ANSWERS
Participating policies pay dividends while non-participating policies do not.
John owns an insurance company that gives him the right to share and then share surplus. What kind of
policy is this? - CORRECT ANSWERS Participating
When a mutual insurer becomes a stock company, the process is called - CORRECT ANSWERS
Demutualization
A person who asserts a right of recovery under an insurance policy is called a - CORRECT ANSWERS
claimant
,In California, an insurer organized under the state laws of Oregon is called a(n) - CORRECT ANSWERS
foreign insurer
Under the California Insurance Code, a licensee's license number must be printed at what size on all
price quotes, business cards, and printed material? - CORRECT ANSWERS The same size print
as the licensee's phone number, fax number or address
As an insurance agent, you are convicted of a crime involving dishonesty or breach of trust. To continue
working in the industry, you must obtain written consent from an insurance regulatory official according
to which federal law? - CORRECT ANSWERS 18 USC Sections 1033 and 1034
According to the California insurance code, the commissioner can disapprove a licensee's request to use
a fictitious name for any of the following reasons EXCEPT that the - CORRECT ANSWERS name
is the licensee's actual name
all of the following are requirements of contract EXCEPT - CORRECT ANSWERS there must be
equal consideration between the parties
If an insurer must have its rates accepted by the insurance Department prior to using them, the insurer
would be operating in which of the following types of jurisdictions? - CORRECT ANSWERS
prior approval
it is federal offense for an insurance agent to do all of the following EXCEPT - CORRECT ANSWERS
misrepresent facts on an insurance application
How often MUST an insurer file the National Association of Insurance Commissioners (NAIC) financial
statement? - CORRECT ANSWERS annually
According to the California Insurance Code, what is the maximum penalty per violation for anyone who
unwilfully commits an unfair method of competition? - CORRECT ANSWERS $5,000
, Section 1729.2 of the California Insurance Code requires insurance producer applications and licensees
to notify the Insurance Commissioner in writing, within ___days of charges in background information
after an application has been submitted or a license has been issued. - CORRECT ANSWERS 30
How long must life agents keep the transaction records? - CORRECT ANSWERS 5 years
What is required after a life agent sells an insurance policy to an applicant without being appointed by
the insurer? - CORRECT ANSWERS Notice of appointment must be submitted to the
Commissioner
Anyone employed in California to assist an insurance agent in transacting insurance is called an
insurance - CORRECT ANSWERS solicitor
The California insurance code has authorized standards for names used by life insurance agents. Which
of the following, if any, are automatically acceptable for Lance Manyon, a holder of the CLU
designation? - CORRECT ANSWERS Lance Manyon, CLU
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? - CORRECT ANSWERS
Mary Brown, CLU Insurance services
according to the California insurance code, if an insurer's certificate of authority is revoked, the
Commissioner can proceed with any of the following EXCEPT - CORRECT ANSWERS using
Guarantee Funds to pay salaries
Pete is a life agent who has misappropriated fiduciary funds to his own use. What is Pete guilty of? -
CORRECT ANSWERS Fiduciary misappropriation
According to the California Insurance Code, how is the word "may" interpreted? - CORRECT ANSWERS
permissive
