webce test questions & Answers. 100% verified. 2022/2023.
which of the following situations presents a situation of pure risk?
-knowing that his family is depending on him, Frank wants to insure his life
-wantin
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webce test questions & Answers. 100% verified. 2022/2023.
which of the following situations presents a situation of pure risk?
-knowing that his family is depending on him, Frank wants to insure his life
-wanting to increase his retirement savings, Saul invests his life savings in the stock market
-Ralph takes a second mortgage on his house and uses the proceeds to gamble
-wanting better job security, Ron cashes in his life insurance to start his own business - ✔✔knowing that his family is depending on him, Frank wants to insure his own life
only pure risk is insurable. Pure risk may only result in a loss, unlike speculative risk which may result in a gain.
Agent Jill received a letter from the Department of insurance asking her to submit verification of having completed the continued education requirements for the previous licensing period. Three weeks later, the department sent another letter. Which penalty may the Department impose if Jill has still not responded to their request a month later? - ✔✔a fine up to $100 per day per violation
A producer has 30 days to respond to a written inquiry from the Department
Jim's policy expired due to nonpayment of premium. His agent sends him a statement the following month without notice of the lapse. If Jim pays the premium and later suffers a loss for which he files a claim, what will prevent the insurer from denying the claim?
-estoppel
-utmost good faith
-reasonable expectations
-waiver - ✔✔estoppel
BBC insurers filed premium rates for its new line of variable products on January 15. Within how many days must the commissioner approve or disapprove the rates? - ✔✔30 days
all rate filings are subject to a 30-day waiting period before they become effective.
The commissioner of insurance can examine the business accounts, transactions, and records of insurers and producers as often as necessary, but must do so at least once in how many years? - ✔✔5 years
Acme Insurance and Apogee insurance agree to offer different premium rates for persons of equal risk within a particular class. They also agree to limit benefits paid to insureds within this class if the insureds live within certain counties of PA. What are Acme and Apogee engaging in?
-acceptable marketing and underwriting practices
-unfair and prohibited business practices
-insurance fraud
-false advertising - ✔✔they are engaging in unfair and prohibited business practices
they are agreeing to unreasonable restraint of trade in insurance business, and they are engaging in unfair discrimination
which of the following is NOT a remedy available to the PA commissioner of insurance for committing an unfair method of competition?
-imprisonment
-cease and desist order
-suspension of license
-revocation of license - ✔✔imprisonment is not a punishment for committing an unfair method of competition
you cannot be arrested for committing an unfair method of competition
which of the following is NOT an unfair claims settlement practice if committed by an insurance company in PA?
-failing to promptly acknowledge communications about claims
-failing to promptly settle a claim for which liability is uncertain
-appealing from an arbitration award in favor of an insured to compel the insured to accept a lower settlement
-failing to affirm or deny coverage within a reasonable time after completing a claim investigation - ✔✔ailing to promptly settle a claim for which liability is uncertain is NOT an unfair claims settlement practice
Jeff is a licensed insurance producer in both PA and NY. he is charged with embezzlement in NY, and his first pretrial hearing is set for March 1. He must notify the PA commissioner of insurance within how many days of this hearing? - ✔✔Jeff has 30 days to notify the PA commissioner of insurance of the disciplinary action being taken against him
which of the following is NOT an unfair claims settlement practice if committed by an insurance company in PA?
-failing to promptly acknowledge communications about claims
-failing to promptly settle a claim for which liability is uncertain
-offering to settle claims for less than due to encourage litigation
-raising policy defenses to reduce a claim - ✔✔failing to promptly settle a claim for which liability is uncertain is not an unfair claims settlement practice
Stacy is a captive agent for best rates insurance company. Her agency contract gives her permission to print and use business cards with the company's logo and submit applications for its policy. What type of authority does stacy have to take these actions? - ✔✔Stacy has express authority due to the contract between her and the insurance company specifically allowing her act in such a way
to boost her sales at the end of the year, agent Trudy started offering potential clients a $250 cash gift card in exchange for purchasing a life insurance policy. which ethical sales practice has she violated?
-twisting
-churning
-rebating
-false information - ✔✔rebating
its illegal to offer gifts in exchange for the purchase of an insurance policy
which of the following is not a power granted to the PA commissioner of insurance?
-licensing producers and companies
-enforcing insurance laws
-issuing regulations to administer insurance laws
-prosecuting individuals for violating insurance laws - ✔✔the PA commissioner of insurance CANNOT prosecute individuals for violating insurance laws
which is not necessary to create a legal contract?
-consideration
-offer
-warranty
-acceptance - ✔✔warranty is not necessary to create a legal contract
the federal risk retention act of 1986 applies to which business?
-self-insuring business
-re-insurers
-credit life insurance companies
-high-risk business insurers - ✔✔the federal risk retention act of 1986 applies to self-insuring businesses
Jeremy has had an individual health insurance policy for many years because of his family's history of cancer. the tendency of someone like jeremy to buy and retain insurance is known as:
-implied selection
-adverse selection
-exposure reduction
-risk avoidance - ✔✔his tendency to buy and retain insurance is known as adverse selection
with respect to social security benefits, what is a worker's primary insurance amount (PIA)?
-the amount of retirement benefit the worker will receive at their full retirement age
-the total amount of money a person earned during their lifetime
-the amount payable to the surviving spouse after the worker's death
-the amount of retirement and disability benefit payable to the worker and their spouse - ✔✔a worker's primary insurance amount is the amount of retirement benefit the worker will receive at their full retirement age
a type of life insurance that covers two people and only pays the death benefit upon the second insured's death is called:
-survivorship life
-family life
-spousal life
-joint life - ✔✔survivorship life
tom bought a $100,000 adjustable life insurance policy. with respect to that policy, all the following statements are correct EXCEPT:
-tom can increase the death benefits under his policy if he can prove insurability
-if tom wants to change the premium, both he and the insurer must agree to the change
-if tom wants to increase the amount of the death benefit by more than $50,000, he will have to buy a new policy
-if tom increases the death benefit but does not increase the premium, the cash value growth slows or stops - ✔✔it is not true that tom will have to buy a new policy if he wants to increase the death benefit by more than $50,000
if a policyowner partially surrenders an adjustable life policy, which of the following happens?
-the premium stays level
-the premium goes up proportionately
-the premium goes down
-the premium goes down by the amount of the withdrawal - ✔✔when a policyowner partially surrenders an adjustable life policy, the premium goes down. It proportionately reduces the policy's death benefit and future premium
sandy and cindy are healthy, 45 years old, and have similar life expectancies. though they are insured by the same company, sandy's life insurance premiums are considerably lower than cindy's. what may this indicate a case of?
-misrepresentation
-unfair discrimination
-twisting
-false advertising - ✔✔unfair discrimination
agent monroe helped her client brian enter into a viatical settlement agreement with best insurers. which of the following parties will get the life insurance proceeds upon brians death?
-brian's beneficiaries under his will
-agent monroe
-agent monroe and best insurers
-best insurers - ✔✔Best Insurers will get the proceeds
Len decided to surrender his policy for its cash value. All the following statements concerning his decision are correct EXCEPT:
-the insurer will send len a check for the policy's cash surrender value
-the insurer may decide to pay the cash value either in a lump sum or monthly installments
-the policy is cancelled and the insurer's responsibility under the contract ends
-the policy cannot be reinstated - ✔✔It's not true that the insurer may decided to pay the cash value either in a lump sum or in monthly installments. The insurer is required to pay it in a lump sum
a provision found in some deferred annuities, which allows surrender charge-free withdrawals if the interest rate credited to the accumulated value drops below a specified level, is called:
-surrender provision
-bailout provision
-release provision
-non-forfeiture provision - ✔✔this is called the bailout provision
which of the following statements regarding third-party ownership is correct?
-the insured has no rights in the policy
-the insured can access the policy's cash value but cannot designate beneficiaries
-the insured can designate a beneficiary and access the cash value, but cannot assign the policy to another third-party owner - ✔✔it is correct that the insured has no rights in the policy
all the following statements regarding life insurance term riders are correct EXCEPT:
-if the insured is alive at the end of the term, then the coverage ends without value
-term life insurance riders has no cash value or any other living benefits associated with them
-a term rider provides additional coverage for as long as the insured maintains the base whole life policy
-like term life insurance policies, term riders continue only for a specified amount of time - ✔✔it is not true that a term rider provides additional coverage for as long as the insured maintains the base whole life policy.
james bought a life insurance policy 18 months ago. If he commits suicide today, what, if anything, would the insurer be obligated to pay the beneficiary?
-the full death benefit
-the death benefit minus premiums paid
-refund of the premiums paid
-nothing - ✔✔If you commit suicide within 2 years after purchasing a life insurance policy, the insurer is obligated to only refund the premiums paid to your beneficiary.
in some states, employers can buy group life insurance for their employees through a multiple employer trust (MET). All the following statements about METs are correct EXCEPT:
-each individual employer is issued a separate policy
-a MET must have at least 2 employers and 100 employees
-for contributory plans, 75% of the group must enroll
-for noncontributory plans, 100% of the group must enroll - ✔✔it is not true that each individual employer is issued a separate policy
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