Webce Life and Health Insurance Exam
Questions and Answers
(Verified Answers)
1. 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.
2. Agent Jill received a letter from the Department of insurance asking her
to submit verification of having completed the continued education require-
ments 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
3. 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
4. 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.
5. The commissioner of insurance can examine the business accounts, trans-
actions, and records of insurers and producers as often as necessary, but
must do so at least once in how many years?
,: 5 years
, 6. 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
7. 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 unfairmethod of competition
you cannot be arrested for committing an unfair method of competition
Questions and Answers
(Verified Answers)
1. 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.
2. Agent Jill received a letter from the Department of insurance asking her
to submit verification of having completed the continued education require-
ments 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
3. 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
4. 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.
5. The commissioner of insurance can examine the business accounts, trans-
actions, and records of insurers and producers as often as necessary, but
must do so at least once in how many years?
,: 5 years
, 6. 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
7. 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 unfairmethod of competition
you cannot be arrested for committing an unfair method of competition
