WFG License Exam Questions and Answers with Verified Solutions |
Latest 2026 Update
Q: Any situation that presents the possibility of a loss is known as
Answer:
a loss exposure
Making an insured whole by restoring them to the same condition as before a loss
is an example of -
the principle of indemnity
Q: What is a requirement of a contract?
Answer:
there must be offer and acceptance of the contract terms
Q: What are the benefits of insurance
Answer:
provides a source of investment funds provides payment for the costs of covered
losses
reduces the uncertainty created by many loss exposures
Q: What is not a benefit of insurance
Answer:
Eliminates fraudulent losses
Q: According to the California insurance Code, if an insurer's certificate of
authority is revoked, how can the Commissioner proceed
Answer:
online at the department of insurance website
confiscating office premises liquidating the business
Q: According to the California insurance Code, if an insurer's certificate of
authority is revoked, what CAN'T the Commissioner do
Answer:
using Guarantee Funds to pay salaries
Upon notification of a claim, a claimant must be given access to the California fair
Claims Settlement Practices resolution by all of the following means EXCEPT
,On-line at the Department of insurance internet site.
By interview appointment with the agent of record.
A copy free of charge from the insurer.
Q: Written notification from the insurer.
Answer:
By interview appointment by the agent of record
All of the following would be considered unfair trade practices EXCEPT
Making a statement misrepresenting terms of any policy issued.
Committing any act of discrimination whether it be deemed fair or unfair.
Filing with any supervisor or other public official any false statement of financial
condition of an insurer.
Q: Making a statement before the public about any person in the conduct of his
insurance business that is untrue.
Answer:
Committing any act of discrimination whether it be deemed fair or unfair
Q: Why is having a large number of similar exposure units important to insurers?
Answer:
The greater the number insured, the more accurately the insurer can predict losses
and set appropriate premiums
Loss retention is an effective risk management technique when all of the following
conditions exist EXCEPT the
Losses are highly predictable.
Probability of loss is unknown.
Worst possible loss is not serious.
Q: Insured chooses to assume the losses involved.
Answer:
Probability of loss is unknown
The required contents of a policy include all of the following EXCEPT
Risks insured against.
Parties to the contract.
The probability of loss.
,Q: The period during which the insurance is to continue.
Answer:
the probability of loss
Risk can be defined as all of the following EXCEPT
Uncertainty.
The cause of loss.
The chance of loss.
Q: 0 0 The probability of an unexpected outcome.
Answer:
the cause of loss
As authorized by the California insurance code, the insurance commissioner has
provided standards for names used by life insurance agents. Under these standards
which, if any, of the
Q: following are automatically acceptable for Mary Brown, a holder of the CLU
designation?
Answer:
Mary Brown Insurance Services
Q: Insureds are entitled to recover an amount NOT greater than the amount of
their loss under the principle of
Answer:
indemnity
Q: A contract in which one party promises to indemnify another against loss that
arises from an unknown event is
Answer:
an insurance policy
The process by which an insurer decides whether to issue requested insurance is
called -
underwriting
All of the following statements about aleatory contracts are true EXCEPT
They may be interpreted as a form of gambling.
There are cases where the insurer pays nothing.
, The insured and insurer contribute equally to the contract.
Q: If a loss occurs, the insured's premium is small in relation to the amount the
insurer pays.
Answer:
the insured and the insurer contribute equally to the contract
Q: As defined in the California insurance code, "insurance" is a
Answer:
contract
All of the occurrences listed below are examples of an insurable event as defined
by the California Insurance Code EXCEPT
A guest is injured by a fall from the insured's deck.
An insured suffers a financial loss in the state lottery.
An insured is sued for unintentional slander of another person.
Q: 0 0 An insured is admitted to the hospital for delivery of a newborn.
Answer:
an insured suffers a financial loss in the state lottery
Q: A situation in which there is a possibility of loss or a gain is a
Answer:
speculative risk
Insurer policy expenses include all of the following EXCEPT
Taxes.
Premiums.
Agent commissions.
Q: Home office operations.
Answer:
premiums
Q: Which information is not required to be communicated in a life insurance
contract?
Answer:
personal judgement
Latest 2026 Update
Q: Any situation that presents the possibility of a loss is known as
Answer:
a loss exposure
Making an insured whole by restoring them to the same condition as before a loss
is an example of -
the principle of indemnity
Q: What is a requirement of a contract?
Answer:
there must be offer and acceptance of the contract terms
Q: What are the benefits of insurance
Answer:
provides a source of investment funds provides payment for the costs of covered
losses
reduces the uncertainty created by many loss exposures
Q: What is not a benefit of insurance
Answer:
Eliminates fraudulent losses
Q: According to the California insurance Code, if an insurer's certificate of
authority is revoked, how can the Commissioner proceed
Answer:
online at the department of insurance website
confiscating office premises liquidating the business
Q: According to the California insurance Code, if an insurer's certificate of
authority is revoked, what CAN'T the Commissioner do
Answer:
using Guarantee Funds to pay salaries
Upon notification of a claim, a claimant must be given access to the California fair
Claims Settlement Practices resolution by all of the following means EXCEPT
,On-line at the Department of insurance internet site.
By interview appointment with the agent of record.
A copy free of charge from the insurer.
Q: Written notification from the insurer.
Answer:
By interview appointment by the agent of record
All of the following would be considered unfair trade practices EXCEPT
Making a statement misrepresenting terms of any policy issued.
Committing any act of discrimination whether it be deemed fair or unfair.
Filing with any supervisor or other public official any false statement of financial
condition of an insurer.
Q: Making a statement before the public about any person in the conduct of his
insurance business that is untrue.
Answer:
Committing any act of discrimination whether it be deemed fair or unfair
Q: Why is having a large number of similar exposure units important to insurers?
Answer:
The greater the number insured, the more accurately the insurer can predict losses
and set appropriate premiums
Loss retention is an effective risk management technique when all of the following
conditions exist EXCEPT the
Losses are highly predictable.
Probability of loss is unknown.
Worst possible loss is not serious.
Q: Insured chooses to assume the losses involved.
Answer:
Probability of loss is unknown
The required contents of a policy include all of the following EXCEPT
Risks insured against.
Parties to the contract.
The probability of loss.
,Q: The period during which the insurance is to continue.
Answer:
the probability of loss
Risk can be defined as all of the following EXCEPT
Uncertainty.
The cause of loss.
The chance of loss.
Q: 0 0 The probability of an unexpected outcome.
Answer:
the cause of loss
As authorized by the California insurance code, the insurance commissioner has
provided standards for names used by life insurance agents. Under these standards
which, if any, of the
Q: following are automatically acceptable for Mary Brown, a holder of the CLU
designation?
Answer:
Mary Brown Insurance Services
Q: Insureds are entitled to recover an amount NOT greater than the amount of
their loss under the principle of
Answer:
indemnity
Q: A contract in which one party promises to indemnify another against loss that
arises from an unknown event is
Answer:
an insurance policy
The process by which an insurer decides whether to issue requested insurance is
called -
underwriting
All of the following statements about aleatory contracts are true EXCEPT
They may be interpreted as a form of gambling.
There are cases where the insurer pays nothing.
, The insured and insurer contribute equally to the contract.
Q: If a loss occurs, the insured's premium is small in relation to the amount the
insurer pays.
Answer:
the insured and the insurer contribute equally to the contract
Q: As defined in the California insurance code, "insurance" is a
Answer:
contract
All of the occurrences listed below are examples of an insurable event as defined
by the California Insurance Code EXCEPT
A guest is injured by a fall from the insured's deck.
An insured suffers a financial loss in the state lottery.
An insured is sued for unintentional slander of another person.
Q: 0 0 An insured is admitted to the hospital for delivery of a newborn.
Answer:
an insured suffers a financial loss in the state lottery
Q: A situation in which there is a possibility of loss or a gain is a
Answer:
speculative risk
Insurer policy expenses include all of the following EXCEPT
Taxes.
Premiums.
Agent commissions.
Q: Home office operations.
Answer:
premiums
Q: Which information is not required to be communicated in a life insurance
contract?
Answer:
personal judgement
