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PSI: LIFE, ACCIDENT, AND HEALTH
PRACTICE EXAM QUESTIONS AND
VERIFIED ANSWERS LATEST 2025
GRADED A
A basic vision care package includes all of the following EXCEPT? - ANSSafety glasses A consumer report used to determine eligibility for insurance may include all of the following EXCEPT? - ANSMedical Underwriting exam. A group conversion option may be used in all the following instances EXCEPT? - ANSA life-changing event, such as marriage, divorce, or childbirth. All of the following are characteristics of COBRA EXCEPT? - ANSChange in medical privacy procedures. All of the following are characteristics of variable whole life EXCEPT? - ANSThere is no guaranteed minimum death benefit. All of the following are classifications of risk EXCEPT? - ANSNon-nicotine
All of the following are common exclusions from loss found in disability income policies EXCEPT for that incurred while? - ANSCommitting a misdemeanor All of the following are non-forfeiture options EXCEPT - ANSCash dividend option. All of the following are required signatures on a life insurance application EXCEPT? - ANSThe minor in a juvenile policy. All of the following are requirements to qualify for Social Security disability benefits EXCEPT when - ANSUnable to work in occupation on which the worker was trained or educated. All of the following are tax qualified retirement plans EXCEPT? - ANSSection 529 plan. All of the following are TRUE regarding incomplete applications EXCEPT? - ANSThe incomplete application can be accepted with the missing information added later. All of the following statements define preexisting conditions EXCEPT? - ANSAny chronic health condition that presents symptoms and which was unknown at the time of application.
If the insurer wishes to share an applicant's HIV status, the applicant must be given full notice of all of the following EXCEPT? - ANSThe treatment procedures that are covered by the policy. In a case where an individual's health is insured by both their own policy and their spouse's policy, which policy pays in the event of an illness? - ANSThe individual's policy pays first, the spouse's policy pay the remaining up to coverage amount. In a home healthcare benefit, all of the following are eligible expenses EXCEPT? - ANSBlood Transfusions In noncontributory plans, which percentage of eligible members must participate? - ANS100% In which of the following does a covered employee agree to a reduction in compensation so the amount can be used to cover medical expenses? - ANSFlexible Spending Account (FSA) Managed care plans increase efficiency by all of the following means EXCEPT? - ANSTransferring the management of costs to the insureds. Obtaining consumer information reports under false pretenses is prosecutable by which of the following? - ANSFair Credit Reporting Act Short term disability insurance generally only covers injuries due to which of the following? - ANSNon-occupational injuries.
State generally define a true "Group" for insurance as requiring a minimum of how many participants? - ANS The group conversion option is allowed for all of the following EXCEPT? - ANSDuring the annual benefits enrollment period. Under normal conditions which of the following is TRUE for proof of loss when a single loss is claimed? - ANSThe insured has 90 days from the date of loss to provide proof of loss. Under the misstatement of age or gender provision, what happens if it is determined at death that the insured's age or gender was misstated on a life insurance policy application? - ANSBenefits are adjusted to an amount that the premium would have purchased at the correct age or gender. Under which situation must insurable interest exist between the applicant and insured at the time of application? - ANSWhen a third-party application names themselves beneficiary. What does coninsurance mean? - ANSThe insurer and the insured share expenses over the deductible. What does first dollar coverage mean? - ANSAs soon as covered medical expenses are incurred, the policy begins to pay.
What type of insurance should a company purchase if it wants to insure the life of its CEO? - ANSKey person insurance When can the premiums of an individually owned health insurance policy be deducted from the individual's income tax? - ANSWhen the taxpayer's medical expenses exceed 7.5% of adjusted gross income during a taxable year. When does insurable interest come into play in a life insurance policy? - ANSWhen the applicant for the policy is not the insured. When should a buy-sell agreement include a provision for the buy-out of an owner's business interest in the event of a disability? - ANSWhen there is a buy-sell agreement funded with life insurance to buyout the interest of a deceased owner or partner. When the suicide clause is inserted in a life insurance contract, death by suicide is not covered during the policy's initial: - ANS2 year period When will a policy pay on a UCR basis? - ANSWhen particular benefits are not listed on a payment schedule. Which insurance plans are commonly offered through the work-site (employer sponsored) EXCEPT? - ANSMedicare Which is a disadvantage to a flexible premium annuity? - ANSThe actual amount of the annuity benefit cannot be determined in advance.
Which is the difference between participating and non-participating? - ANSParticipating policies pay dividends while non-participating policies do not. Which is the primary purpose of Health Reimbursement Accounts (HFAs)?
- ANSTo assist covered employees with the payment of medical expenses on a high deductible plan funded through pre-tax. Which of the following amends the Social Security Act to make Medicare secondary to group health plans? - ANSTEFRA Which of the following coverage types pays a monthly cash benefit following the elimination period for total disability due to accident or sickness? - ANSDisability income insurance Which of the following is characteristic of a non-qualified plan? - ANSPlan does not meet federal guidelines for tax benefits. Which of the following is covered by a dread disease policy? - ANSIllnesses that do not occur frequently but incur significant costs when they do occur. Which of the following is defined as the dollar amount beyond which the insured no longer participates in payment of medical expenses? - ANSStop Loss Limit
Which one of the following represents an advantage of obtaining a policy loan versus a withdrawal? - ANSThe loan is not taxed while a withdrawal is taxed for amounts above the contract cost basis. Which problem was Universal Life insurance designed to address? - ANSLow interest rates during periods of high inflation. Which type of annuity covers two or more annuitants and provides monthly income only until the first annuitant dies? - ANSJoint Life Annuity Which type of receipt makes the insurer liable for the risk from the date of application, regardless of the applicant's insurability? - ANSBinding receipt Which types of life policy can be continued year after year without a required medical examination but rates are dependent on the insured's current age? - ANSRenewable term Whose responsibility is it to make sure that the company is notified of a death claim at the earliest possible opportunity (in most cases)? - ANSThe producer. Why are insurance policies considered conditional contracts? - ANSCertain conditions need to be met to make the contract legally enforceable.
Why is rehabilitation considered worthy of federal help under workers' compensation? - ANSIt reduces insurance losses and helps regain the worker's dignity. Why is relying solely on employer group life insurance generally considered inadequate for most individual's needs? - ANSIt is financially insufficient to cover end of life expenses.
