Webce Test Questions Exam With 100% Correct Answers 2023

Webce Test Questions Exam With 100% Correct Answers 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 - Correct Answer-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? - Correct Answer-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 - Correct Answer-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? - Correct Answer-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? - Correct Answer-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 - Correct Answer-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 - Correct Answer-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 - Correct Answer-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? - Correct AnswerJeff 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 - Correct Answer-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? - Correct Answer-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 - Correct Answer-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 - Correct Answer-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 - Correct Answer-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 - Correct Answer-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 - Correct Answer-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 - Correct Answer-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 - Correct Answer-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 - Correct Answer-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 - Correct Answer-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 - Correct Answer-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 - Correct Answer-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 - Correct Answer-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 - Correct Answer-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 - Correct Answer-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 - Correct Answer-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 - Correct Answer-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 - Correct Answer-it is not true that each individual employer is issued a separate policy which of the following statements is true with all types of life insurance? -premiums are invested in the insurer's general account, allowing policy values to be contractually guaranteed -insurers return excess premiums in the form of policy dividends -life insurance policies are noncancellable by the insurer except for non-payment of premium -life insurance policies feature a cash value that can be accessed while the insured is alive - Correct Answer-it is true that all life insurance policies are noncancellable by the insurer except for nonpayment of premiums which of the following statements about non-qualified deferred compensation plans is most correct? -the basic purpose of a deferred compensation plan is to defer the receipt of compensation until one is in a lower tax bracket and will pay lower taxes -the executive will receive the deferred compensation when they change jobs -if the executive dies before retirement, their heirs will not receive any of the deferred compensation -life insurance is never used with deferred compensation plans - Correct Answer-the basic purpose of a deferred compensation plan is to defer the receipt of compensation until one is in a lower tax bracket and will pay lower taxes benefits paid through a life insurance policy's accelerated benefit rider: -must be used for medical expenses directly related to the reason for the insured's terminal illness or injury -can be used for any purpose as long as the expense is medical-related -must be used for long-term care expenses -can be used for any purpose - Correct Answer-accelerated benefit funds can be used for any purpose, though they are meant for medical and living expenses after Bob and Ellen's first child is born, the couple wants to add the baby to their policy, while increasing Ellen's coverage. they would probably buy which of the following? -spouse/other insured term rider -children's term rider -family term rider -living benefits rider - Correct Answer-they would buy a family term rider because this rider covers multiple family members equally. the guaranteed miniumum interest rate in an indexed deferred annuity is typically: -1 to 3% -4 to 5% -6 to 10% -depends on the participation rate and cap - Correct Answer-typically 1-3% is guaranteed what type of life insurance policy distributes its surplus after the company accounts for reserves, liabilities, capital, and expenses? -participating policy -non participating policy -industrial insurance policy -commercial insurance - Correct Answer-a participating policy because this policy participates in the divisible surplus of the insurer which statement about increasing term insurance is correct? -premiums are generally lower than level term or decreasing term insurance -it is normally sold as a rider on a permanent life policy -the premium increases during the policy term as the death benefit increases -the cash value increases during the term - Correct Answer-term insurance is normally sold as a rider on a permanent life policy with respect to roth IRA conversions, all the following statements are correct EXCEPT: -income taxes must be paid on the tradiaitonal IRA when the account is converted -to convert to a roth IRA, a person must have earned income -amounts converted to a roth IRA will grow tax free -the convert to a roth IRA, the owner may have any amount of modified adjusted gross income in the year of the conversion - Correct Answer-it is not true that you must have earned income to convert to a roth IRA under a disability waiver of premium rider, an insured most commonly must be totally disabled for how long before the waiver begins? - Correct Answer-most waiver of premium riders require that the insured be totally disabled for SIX MONTHS before the waiver begins julia signed a viatical settlement agreement on May 1. 2 weeks later she decides she no longer wants to sell the policy, what are her options? -julia may cancel the contract only if the viatical settlement provider consents -julia may cancel the contract because the cancellation period has not ended -julia may cancel and contract and keep any proceeds -julia cannot cancel the contract because the cancellation period has ended - Correct Answer-julia can cancel the contract because the cancellation period is 30 days after signing the contract and 15 days after getting proceeds chester established a 529 plan for his daughter and contributed $5,000 to the account this year. 6 months later, he withdrew $20k to pay for his daughter's college tuition. Which statement is true? -they can take a tax deductible for the contribution -chester does not have to pay tax on the distribution -chester must pay tax on the earnings portion of the withdrawal -chester can take an income tax deduction for their withdrawal - Correct Answer-chester does not have to pay tax on the distribution because the interest earned and the funds are not taxable what is the maximum amount of time most states allow insurers to delay paying cash surrender values when a life insurance policy is canceled?