PSI Arizona Life Insurance Test Exam Comprehensive
Questions and Revised Answers Graded A+
1. If an annuitantdies beforeannuitizationoccurs,ẁhat ẁill the
beneficiary receive?
A Amountpaid into theplan
B Cash Valueof theplan
C Either the amount paid into the plan or the cash value of the plan, ẁhichever
is the greatest amount: Either the amount paid into the plan or the cash value of the plan,
ẁhichever is the
greatestamount
2. A life annuity ceasespaymentsto the annuitantat
A Death
B Maturity
Age 100
policy termination: death
3. Ẁhich is an accuratestatementregarding a fixed annuity?
A) Income payments vary from one payment to the next
B) The insurance company guarantees the specified amounts for each
- pay
ment
C) Its value is based on the value of the securities underlying the annuity
D) It is a riskier investment than an equity -indexed annuity or mutual fund:
,The insurance company guarantees the specified amounts for each payment
4. Ẁhich of the follo ẁing is NOT an option in anAdjustable LifePolicy
A) the policy oẁner can modify the protection period and change the duration
of premium payment.
B) The policy's faceamountcan be increasedor decreased
,C) The policyo ẁner can increase the death benefit by using one of the nonfor -
feiture options
D) The policyo ẁner can increase or decrease the amount of the premium
payment: C) The policyoẁner can increase the death benefit by using one of the nonforfeitureoptions
5. A reduction of the premium dividend option allo ẁs the policyo ẁner to
A) decrease the premium and cash value amounts ẁith the dividend payment.
B) purchasea less expensive1-year term policy.
C) Apply the dividend payment to the next year's premium payment
D) Increase the death benefit:C) Apply the dividendpaymentto thenext year's premiumpayment
6. The limitation expressed in limited payment policies is a limit on the
number of annual premiums or the
A) maximumamountof benefitspayable
B) maximum amount available for loan purposes
C) minimum interest rate on policy cash value
D) age beyond ẁhich premiums ẁill no longer be required:
7. An Insured has a 5-year reneẁable term life insurancepolicy. Uponexercis-
ing the reneẁable privilege, the insurer MUST
A) convertto a ẁholelife policy
B) Pay an annual premium that may be higher.
, C) reneẁ for at least 10 years
D) Provide evidenceof insurability: B) Pay an annualpremiumthat may be higher.
Questions and Revised Answers Graded A+
1. If an annuitantdies beforeannuitizationoccurs,ẁhat ẁill the
beneficiary receive?
A Amountpaid into theplan
B Cash Valueof theplan
C Either the amount paid into the plan or the cash value of the plan, ẁhichever
is the greatest amount: Either the amount paid into the plan or the cash value of the plan,
ẁhichever is the
greatestamount
2. A life annuity ceasespaymentsto the annuitantat
A Death
B Maturity
Age 100
policy termination: death
3. Ẁhich is an accuratestatementregarding a fixed annuity?
A) Income payments vary from one payment to the next
B) The insurance company guarantees the specified amounts for each
- pay
ment
C) Its value is based on the value of the securities underlying the annuity
D) It is a riskier investment than an equity -indexed annuity or mutual fund:
,The insurance company guarantees the specified amounts for each payment
4. Ẁhich of the follo ẁing is NOT an option in anAdjustable LifePolicy
A) the policy oẁner can modify the protection period and change the duration
of premium payment.
B) The policy's faceamountcan be increasedor decreased
,C) The policyo ẁner can increase the death benefit by using one of the nonfor -
feiture options
D) The policyo ẁner can increase or decrease the amount of the premium
payment: C) The policyoẁner can increase the death benefit by using one of the nonforfeitureoptions
5. A reduction of the premium dividend option allo ẁs the policyo ẁner to
A) decrease the premium and cash value amounts ẁith the dividend payment.
B) purchasea less expensive1-year term policy.
C) Apply the dividend payment to the next year's premium payment
D) Increase the death benefit:C) Apply the dividendpaymentto thenext year's premiumpayment
6. The limitation expressed in limited payment policies is a limit on the
number of annual premiums or the
A) maximumamountof benefitspayable
B) maximum amount available for loan purposes
C) minimum interest rate on policy cash value
D) age beyond ẁhich premiums ẁill no longer be required:
7. An Insured has a 5-year reneẁable term life insurancepolicy. Uponexercis-
ing the reneẁable privilege, the insurer MUST
A) convertto a ẁholelife policy
B) Pay an annual premium that may be higher.
, C) reneẁ for at least 10 years
D) Provide evidenceof insurability: B) Pay an annualpremiumthat may be higher.
