PSI EXAM
Which of the following is TRUE regarding continuing education requirements of
an agent or broker? - CORRECT ANSWER-Any licensee shall satisfactorily
complete 24 hours of instruction prior to license renewal.
How is an insurance policy defined? - CORRECT ANSWER-The written
instrument, in which a contract of insurance is set forth.
How does an "admitted" person differ from an "nonadmitted" person, as it
pertains to insurance? - CORRECT ANSWER-An "admitted" person has the right
to transact insurance business within the state, while a "nonadmitted" person is
not entitled to this action
Whether admitted or nonadmitted, how does a "foreign" insurer differ from an
"alien" or "domestic" insurer? - CORRECT ANSWER-A "foreign" insurer is
organized under the laws of another state within the United States.
What is a solicitor employed to do for a policy other than life? - CORRECT
ANSWER-aid an agent or broker in transacting insurance.
Which is considered nonpublic personal information as defined by the California
Financial Code? - CORRECT ANSWER-tax return
In the event of receiving notice of a claim or other claim communication, all of the
following timelines are accurate EXCEPT - CORRECT ANSWER-every licensee
or claims agent shall transmit notice of the claim to the insurer in no more than 5
calendar days.
It is unlawful to do any of the following EXCEPT - CORRECT ANSWER-make or
cause to made a knowingly false or fraudulent or material representation for the
purpose of encouraging an injured worker to claim benefits.
ALL of the following are TRUE regarding the process to change the California
Code of Regulations EXCEPT - CORRECT ANSWER-the Office of
,Administrative Law (OAL) may substitute its own judgment for that of the
rulemaking agency.
If fiduciary funds are received by any licensee, the funds shall be maintained in
any of the following EXCEPT - CORRECT ANSWER-bonds issued in all 50
states of the United States.
An insurance agent is a person who transacts all of the following types of
insurance EXCEPT - CORRECT ANSWER-life insurance.
A policy shall specify all of the following EXCEPT - CORRECT ANSWER-the
method in which the coverage amount was calculated.
Where shall an express warranty be made? - CORRECT ANSWER-in the policy
itself
How may a license may be surrendered by the insure, or terminated by the
employer? - CORRECT ANSWER-Personally delivering the license to the
insurance commissioner, or by written notice from the employer.
"Person" means all of the following EXCEPT - CORRECT ANSWER-an
organizational trust
The Insurance Commissioner may deny an application for any license issued for
any of the following EXCEPT - CORRECT ANSWER-the applicant is lacking in
good judgment.
Which of the following is an insurer allowed to do in the event of a claim? -
CORRECT ANSWER-request a medical examination for the purpose of
determining liability under a policy provision
All of the following define insolvency EXCEPT - CORRECT ANSWER-revocation
of certificate of authority by the commissioner.
According to the Administrative Procedures Act, what is required to make
changes to the California Insurance Code? - CORRECT ANSWER-The
,Department of Insurance is required to publish proposed changes at least 45
days prior to the hearing or decision to adopt the change.
A person who does NOT hold a valid license may do which of the following -
CORRECT ANSWER-examine contracts of insurance.
What are the requirements for notices required by any provision of the insurance
code to a person unless expressly provided otherwise? - CORRECT
ANSWER-They should be sent to a mailing notice at their residence or place of
business.
While both work with an insurer, how does an "Insurance broker" differ from an
"insurance agent"? - CORRECT ANSWER-The broker does not transact on
behalf of an insurer, while the agent does.
Which of the following can the insurer do if the insured intentionally conceals or
misrepresents a material fact concerning any coverage part? - CORRECT
ANSWER-Rescind the contract.
Which of the following provisions of free insurance offered as an incentive to
purchase or rent property is TRUE? - CORRECT ANSWER-It requires a
separate charge or fee.
Which circumstances in a pretext interview determine if the questions are
permissible? - CORRECT ANSWER-When an insured is consulted by a person
who hides his true identity on purpose when fraud for a claim is suspected.
What must an individual do in order to act as an agent for a business entity or
insurer offering limited lines automobile coverage? - CORRECT ANSWER-file a
notice of appointment with the commissioner
What is the primary function of The California Automotive Assigned Risk Plan
(CAARP)? - CORRECT ANSWER-to put people who have trouble obtaining
insurance in touch with insurers who may be required by law to insure them
, All of the following are requirements for determining an area that qualifies for Low
Cost Automobile Insurance EXCEPT - CORRECT ANSWER-the number of
automobile accidents that occur within the county.
Every licensee and applicant for a license shall immediately notify the
commissioner using an approved electronic service of any changes of all of the
following EXCEPT - CORRECT ANSWER-telephone and fax number.
What is the maximum coverage allowed through the California Automobile
Assigned Risk Program for bodily injury and death? - CORRECT ANSWER-The
maximum coverage per accident is limited to $30,000 of all persons as a result of
any one accident.
In conducting the business and affairs of the State Compensation Insurance
Fund, the president of the fund may do any of the following EXCEPT -
CORRECT ANSWER-sell life insurance covering compensation benefits.
Can a lender, as a condition of making a loan, require that any insurance be
placed through a particular insurance agent or broker? - CORRECT
ANSWER-The loan recipient may always select a particular agent or broker of
their choosing.
When is it possible for a commercial vehicle to be eligible for coverage under the
California Automobile Assigned Risk Program? - CORRECT ANSWER-if it is a
privately owned lightweight commercial vehicle used for local service or retail
deliveries within a specific geographic area
All of the following include the way the agency name must be worded and show
the relationship between the corporation and agent EXCEPT - CORRECT
ANSWER-"owned and operated by" (name of company).
Which is an INACCURATE statement regarding the non-standard coverage
provide by surplus line brokers? - CORRECT ANSWER-They must provide
notice to the commissioner within 14 days of providing non-standard coverage for
a home state insured.
Which of the following is TRUE regarding continuing education requirements of
an agent or broker? - CORRECT ANSWER-Any licensee shall satisfactorily
complete 24 hours of instruction prior to license renewal.
How is an insurance policy defined? - CORRECT ANSWER-The written
instrument, in which a contract of insurance is set forth.
How does an "admitted" person differ from an "nonadmitted" person, as it
pertains to insurance? - CORRECT ANSWER-An "admitted" person has the right
to transact insurance business within the state, while a "nonadmitted" person is
not entitled to this action
Whether admitted or nonadmitted, how does a "foreign" insurer differ from an
"alien" or "domestic" insurer? - CORRECT ANSWER-A "foreign" insurer is
organized under the laws of another state within the United States.
What is a solicitor employed to do for a policy other than life? - CORRECT
ANSWER-aid an agent or broker in transacting insurance.
Which is considered nonpublic personal information as defined by the California
Financial Code? - CORRECT ANSWER-tax return
In the event of receiving notice of a claim or other claim communication, all of the
following timelines are accurate EXCEPT - CORRECT ANSWER-every licensee
or claims agent shall transmit notice of the claim to the insurer in no more than 5
calendar days.
It is unlawful to do any of the following EXCEPT - CORRECT ANSWER-make or
cause to made a knowingly false or fraudulent or material representation for the
purpose of encouraging an injured worker to claim benefits.
ALL of the following are TRUE regarding the process to change the California
Code of Regulations EXCEPT - CORRECT ANSWER-the Office of
,Administrative Law (OAL) may substitute its own judgment for that of the
rulemaking agency.
If fiduciary funds are received by any licensee, the funds shall be maintained in
any of the following EXCEPT - CORRECT ANSWER-bonds issued in all 50
states of the United States.
An insurance agent is a person who transacts all of the following types of
insurance EXCEPT - CORRECT ANSWER-life insurance.
A policy shall specify all of the following EXCEPT - CORRECT ANSWER-the
method in which the coverage amount was calculated.
Where shall an express warranty be made? - CORRECT ANSWER-in the policy
itself
How may a license may be surrendered by the insure, or terminated by the
employer? - CORRECT ANSWER-Personally delivering the license to the
insurance commissioner, or by written notice from the employer.
"Person" means all of the following EXCEPT - CORRECT ANSWER-an
organizational trust
The Insurance Commissioner may deny an application for any license issued for
any of the following EXCEPT - CORRECT ANSWER-the applicant is lacking in
good judgment.
Which of the following is an insurer allowed to do in the event of a claim? -
CORRECT ANSWER-request a medical examination for the purpose of
determining liability under a policy provision
All of the following define insolvency EXCEPT - CORRECT ANSWER-revocation
of certificate of authority by the commissioner.
According to the Administrative Procedures Act, what is required to make
changes to the California Insurance Code? - CORRECT ANSWER-The
,Department of Insurance is required to publish proposed changes at least 45
days prior to the hearing or decision to adopt the change.
A person who does NOT hold a valid license may do which of the following -
CORRECT ANSWER-examine contracts of insurance.
What are the requirements for notices required by any provision of the insurance
code to a person unless expressly provided otherwise? - CORRECT
ANSWER-They should be sent to a mailing notice at their residence or place of
business.
While both work with an insurer, how does an "Insurance broker" differ from an
"insurance agent"? - CORRECT ANSWER-The broker does not transact on
behalf of an insurer, while the agent does.
Which of the following can the insurer do if the insured intentionally conceals or
misrepresents a material fact concerning any coverage part? - CORRECT
ANSWER-Rescind the contract.
Which of the following provisions of free insurance offered as an incentive to
purchase or rent property is TRUE? - CORRECT ANSWER-It requires a
separate charge or fee.
Which circumstances in a pretext interview determine if the questions are
permissible? - CORRECT ANSWER-When an insured is consulted by a person
who hides his true identity on purpose when fraud for a claim is suspected.
What must an individual do in order to act as an agent for a business entity or
insurer offering limited lines automobile coverage? - CORRECT ANSWER-file a
notice of appointment with the commissioner
What is the primary function of The California Automotive Assigned Risk Plan
(CAARP)? - CORRECT ANSWER-to put people who have trouble obtaining
insurance in touch with insurers who may be required by law to insure them
, All of the following are requirements for determining an area that qualifies for Low
Cost Automobile Insurance EXCEPT - CORRECT ANSWER-the number of
automobile accidents that occur within the county.
Every licensee and applicant for a license shall immediately notify the
commissioner using an approved electronic service of any changes of all of the
following EXCEPT - CORRECT ANSWER-telephone and fax number.
What is the maximum coverage allowed through the California Automobile
Assigned Risk Program for bodily injury and death? - CORRECT ANSWER-The
maximum coverage per accident is limited to $30,000 of all persons as a result of
any one accident.
In conducting the business and affairs of the State Compensation Insurance
Fund, the president of the fund may do any of the following EXCEPT -
CORRECT ANSWER-sell life insurance covering compensation benefits.
Can a lender, as a condition of making a loan, require that any insurance be
placed through a particular insurance agent or broker? - CORRECT
ANSWER-The loan recipient may always select a particular agent or broker of
their choosing.
When is it possible for a commercial vehicle to be eligible for coverage under the
California Automobile Assigned Risk Program? - CORRECT ANSWER-if it is a
privately owned lightweight commercial vehicle used for local service or retail
deliveries within a specific geographic area
All of the following include the way the agency name must be worded and show
the relationship between the corporation and agent EXCEPT - CORRECT
ANSWER-"owned and operated by" (name of company).
Which is an INACCURATE statement regarding the non-standard coverage
provide by surplus line brokers? - CORRECT ANSWER-They must provide
notice to the commissioner within 14 days of providing non-standard coverage for
a home state insured.
