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Knowledge Exam Flashcards

7 cards from real PSI practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Knowledge Exam flashcards as text

  1. What is 'insurable interest' in the context of life insurance?

    Answer: A financial or emotional stake in the continued life of the insured at the time of application

    Insurable interest means the policyholder must have a legitimate financial or personal stake in the insured's continued life, which is required at the time the policy is issued.

  2. A 'mechanic's lien' can be filed against a property by:

    Answer: Contractors, subcontractors, or suppliers who have not been paid for work or materials

    Mechanic's liens allow contractors, subcontractors, and material suppliers who have not been paid to place a legal claim against the improved property as security for payment.

  3. Under the Fair Housing Act, which of the following is a protected class?

    Answer: National origin

    The federal Fair Housing Act prohibits discrimination based on race, color, religion, sex, national origin, disability, and familial status; national origin is explicitly protected.

  4. When an insured intentionally causes a loss, an insurer can deny the claim based on which policy provision?

    Answer: The concealment and fraud exclusion

    Insurance policies exclude coverage for intentional acts or fraud, so a claim arising from a deliberate loss by the insured can be denied under the concealment and fraud exclusion.

  5. In a real estate transaction, 'earnest money' is best described as:

    Answer: A good-faith deposit made by the buyer to demonstrate intent to purchase

    Earnest money is a deposit provided by the buyer when submitting an offer to show serious intent to purchase; it is typically applied toward the purchase price at closing.

  6. Which licensing exam scheduling action should a candidate take if they need to reschedule a PSI exam?

    Answer: Contact PSI at least 24-48 hours before the scheduled exam to avoid a forfeiture fee

    PSI generally requires candidates to reschedule at least 24-48 hours before the appointment to avoid losing the examination fee; exact windows vary by program.

  7. A real estate licensee who deposits a client's funds into their own personal bank account is guilty of:

    Answer: Commingling

    Commingling is the illegal act of mixing a client's funds with the licensee's personal or business funds; it violates state real estate license laws and can result in license revocation.