CA PSI SITE - LIFE, ACCIDENT AND HEALTH
AGENT EXAMINATION (LIFE AGENT) LATEST
2024-2025 ACTUAL EXAM 100 QUESTIONS AND
CORRECT DETAILED ANSWERS
Practice questions for this set
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Annuity is payable to 2 or more named annuitants while all are living.
o Upon death of the first annuitant, the benefit stops.
Choose matching term
1 Immediate vs. Deferred Annuity 2 Cease and Desist order
3 Joint Life Annuity 4 Per Capita
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Terms in this set (118)
, An admitted insurance company is authorized to transact
insurance in California because it has a Certificate of
Authority granted by the California Department of
Admitted Insurance Insurance (CDI)
Company vs. Non-Admitted
Insurance Company A non-admitted insurance company is not authorized to
transact insurance in California because of failing to
comply with California requirements or did not seek
admission
Pure risks are insurable but Speculative risks are not
Pure Risk vs. Speculative Pure Risks - A possibility of loss, no loss, or gain
Risk
Pure Risk - A possibility of loss or no loss; there is no
possibility for gain
One party writes the contract without inout from the
Contract of Adhesion
other party on a "take-it-or-leave-it" basis
The exchange of value is unequal.
Aleatory Contract
Insured's premium payment is less than the potential
benefit to be received in the event of a loss.
An agreement to pay on behalf of another party under
Indemnity Contract
specified circumstances
Only one party is legally bound to the contractual
obligations after the premium is paid to the insurer
Unilateral Contract
Only the insurer makes a promise of future performance,
and only the insurer can be charged with breach of
contract
1) Competent Parties
4 elements of a valid 2) Legal Purpose
contract 3) Agreement (offer and acceptance)
4) Consideration
, Standard Risks are individuals who have the same health,
habits, sex/gender, and occupational characteristics as
those reflected in the mortality table
Preferred Risks vs Standard
Risks Preferred Risks are individuals who meet certain
requirements and qualify for lower premiums because of
ideal health, height and weight. Individuals in this
category have a longer than average life expectancy
Human Life Value approach is a measure of the
projected future earnings and services of a person at
risk in the event of a premature death.
The objective is to provide the proper amount of
coverage as determined by the value of the individual to
his/her dependents using the following factors:
- The individual's age and gender
- The individual's occupation, annual wage, and planned
retirement age
- Inflation
Human Life Value Approach
vs. Needs Analysis Needs Analysis Approach determines a need for
Approach coverage upon the premature death of an individual.
It always assumes the death of the individual to be
immediate and factors the following steps into arriving at
the proper amount of coverage needed:
- Calculate all financial needs caused by immediate
death, including debts, medical bills, and final expenses
- Provide lifetime income to the spouse
- Pay off mortgage or other debts
- Provide funds for children's education
- Subtracts any assets available to fund financial needs
after death (such as retirement plan, other insurance,
liquid investments, separate savings)
, Life Insurance Disability Rider
If the insured becomes totally disabled, the insurer will
waive premiums for the duration of the disability or the
end of the policy, whichever occurs first.
To qualify for the waiver, the insured must be disabled
Waiver of Premium for a waiting period of 3-6 months.
The policyowner must continue to pay premiums during
the waiting period, but once eligible, the waiver is
retroactive to the start of the disability and the premiums
will be refunded.
During the disability, the insured will credit the premiums
to the policy and all benefits, such as cash value
accumulation and dividend payments, will continue.
Life Insurance Disability Rider
In the event of total disability and after the initial waiting
period (such as 6 months), premiums are waived and the
insured is paid a monthly income.
Disability Income Rider
The monthly disability income benefit is typically limited
to a percentage of the face value.
The benefit paid from the rider does not reduce the
death benefits paid out upon death.
Life Insurance Rider affecting the death benefit amount
May be called multiple indemnity rider
Accidental Death Benefit In the event of a claim, the policy normally pays double
rider or triple the face amount only if the insured's death was a
result of an accident.
The benefit is payable only if death occurs before a
specific age and within 90 days of the accident
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