WFG EXAM
The Family Medical Leave Act provides for what minimum amount of unpaid leave? a. 12 weeks b. 8 weeks c. 6 weeks d. 2 weeks
a. 12 weeks
Which of the following is true in regard to health insurance issued on a group basis? a. All eligible members must be covered under a "non-contributory" group health plan b. All eligible members must be covered under a "contributory" group health plan c. No less than 50% of the eligible employees must elect to participate in the plan if it is considered a "contributory" plan d. No less than 75% of the eligible employees must elect to participate in the plan if it is considered a "non-contributory" plan
a. All eligible members must be covered under a "non-contributory" group health plan
In order to qualify to sell LTC insurance in the state of California, agent must comply with all of the following EXCEPT a. All licensees are required to pass a LTC knowledge exam every 10 years b. For licenses issued after Jan 1, 1982, 8 hours of training for the first 4 12-month period from dat of license issuance, then 8 hours prior to each renewal c. Non-resident licensees file with the Insurance Commissioner and have Commissioner approve education requirement d. Eight hours prior to renewal for licenses issued prior to January 1, 19
a. All licensees are required to pass a LTC knowledge exam every 10 years
A contract in which one party promises to indemnify another against another against loss that arises from an unknown event is a. An insurance policy. b. A restoration policy. c. A retrocession agreement. d. A hold-harmless agreement.
a. An insurance policy.
A contract in which one party promises to indemnify another against loss that arises from an unknown event is a. An insurance policy. b. A restoration policy. c. A retrocession agreement. d. A hold-harmless agreement.
a. An insurance policy.
As defined in the California Insurance Code, "insurance" is a a. Contract. b. Gamble. c. Peril. d. Risk.
a. Contract.
As defined in the California insurance code, "insurance" is a a. Contract. b. Gamble. c. Peril. d. Risk.
a. Contract.
All of the following are benefits of insurance EXCEPT it a. Eliminates fraudulent losses. b. Provides a source of investment funds. c. Provides payment for the costs of covered losses. d. Reduces the uncertainty created by many loss exposures.
a. Eliminates fraudulent losses.
If you have been convicted of a misdemeanor and that misdemeanor conviction is later expunged pursuant to California Penal Code Section 1203.4, which of the following is true? a. Even though your misdemeanor conviction was expunged, you must still disclose your misdemeanor conviction on your individual application for an insurance license. b. Since your misdemeanor conviction was expunged, you do not need to disclose your misdemeanor conviction on your individual application for and insurance license. c. The California department of insurance only requires an applicant to disclose felony convictions. d. None of the above.
a. Even though your misdemeanor conviction was expunged, you must still disclose your misdemeanor conviction on your individual application for an insurance license.
An agent who is acting as an insurance agent, broker, solicitor, life agent, accident and health, or bail agent acts in which capacity when handling premiums or return premiums for an insured? a. Fiduciary. b. Legal representative. c. Managing general agent. d. Natural person.
a. Fiduciary.
According to the California insurance code, an insurance policy must specify all of the following EXCEPT the a. Financial rating of the insurer. b. Property or life being insured. c. Risks insured against. d. Policy period.
a. Financial rating of the insurer.
All of the following qualify as "background information" as defined in section 1729.2 of the California Insurance Code, EXCEPT a. Misdemeanor charges filed not resulting in conviction. b. An administrative action regarding a professional or occupational license. c. A misdemeanor or felony conviction or a filing of felony criminal charges in a state or federal court. d. Any admission, or judicial finding or determination, of fraud, misappropriation or conversion of funds, misrepresentation, or breach of fiduciary duty.
a. Misdemeanor charges filed not resulting in conviction.
According to the California Insurance Code, the Commissioner can disapprove a licensee's request to use a fictitious name for any of the following reasons EXCEPT that the a. Name is the licensee's actual name. b. Use of the name would be misleading. c. Name is too similar to a name already filed. d. Name implies that the licensee is an underwriter.
a. Name is the licensee's actual name.
A contract of indemnity is one in which a. One party is restored to the same financial position the party was in before the loss occurred. b. One party is obligated to assume the legal liability of another party. c. One party must adhere to the agreement as written by the other party. d. Both parties are expected to act in complete honesty.
a. One party is restored to the same financial position the party was in before the loss occurred.
Which of following statements regarding risk is TRUE? a. Only pure risks are insurable b. Only speculative risks are insurable c. Both pure and speculative risks are insurable. d. Neither pure nor speculative risks are insurable.
a. Only pure risks are insurable
Which of the following statements regarding risk is TRUE? a. Only pure risks are insurable. b. Only speculative risks are insurable. c. Both pure and speculative risks are insurable. d. Neither pure nor speculative risks are insurable.
a. Only pure risks are insurable.
Unless it is merely a statement of an expectation or a belief, a representation as to the future is considered which of the following? a. Promise b. Provision c. Liability d. Description
a. Promise
Which insurance policy pays on the death of the second insured? a. Promise b. Provision c. Liability d. Description
a. Promise
Unintentional concealment entitles the injured party to which course of action, if any? a. Rescission of the contract. b. $250 fine to be paid to the injured party. c. Possible imprisonment to the party who concealed the information. d. None, due to the fact that the concealment was unintentional.
a. Rescission of the contract.
The direct response distribution of insurance utilizes all of the following to promote the sale of insurance EXCEPT a. Internet advertising. b. Television commercials. c. Telephone call from an agent. d. Brochures mailed to prospective clients.
a. Telephone call from an agent.
Why is having a large number of similar exposure units important to insurers? a. The greater the number insured, the more accurately the insurer can predict losses and set appropriate premiums. b. The greater the number insured, the more premium is collected to offset fixed costs. c. The greater the number insured, the greater the amount of premiums collected to help cover losses. d. The insurer increases its market share with every insured.
a. The greater the number insured, the more accurately the insurer can predict losses and set appropriate premiums.
The more times an event is repeated, the more predictable the outcome becomes. This is an example of a. The law of large numbers. b. Standard deviation. c. Average dispersion. d. Normal variance.
a. The law of large numbers.
What would a person be guilty of who refuses to deliver any books, records, or assets to the commissioner once a seizure order has been executed? a. A felony. b. A misdemeanor. c. Misrepresentation. d. Contempt of court.
b. A misdemeanor.
Which of the following would an agent be guilty for misrepresenting the amount of dividends a policy will pay? a. A felony b. A misdemeanor. c. An aleatoric breach. d. A fiduciary infraction.
b. A misdemeanor.
A measure for rating an individual's need for LTC benefit is called a. Case management b. Activities of daily living c. The gatekeeper mechanism d. Co-insurance
b. Activities of daily living
All of the occurrences listed below are examples of an insurable event as defined by the California Insurance Code EXCEPT a. A guest is injured by a fall from the insured's deck. b. An insured suffers a financial loss in the state lottery. c. An insured is sued for unintentional slander of another person. d. An insured is admitted to the hospital for delivery of a newborn.
b. An insured suffers a financial loss in the state lottery.
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 a. On-line at the Department of insurance internet site. b. By interview appointment with the agent of record. c. A copy free of charge from the insurer. d. Written notification from the insurer.
b. By interview appointment with the agent of record.
Upon notification of claim, a claimant must be given access to the California Fair Claims Settlement Practices Regulations by all of the following means EXCEPT a. On-line at the department of insurance internet site. b. By interview appointment with the agent of record. c. A copy free of charge from the insurer. d. Written notification from the insurer.
b. By interview appointment with the agent of record.
All of the following would be considered unfair trade practices EXCEPT a. Making a statement misrepresenting terms of any policy issued. b. Committing any act of discrimination whether it be deemed fair or unfair. c. Filing with any supervisor or other public official any false statement of financial condition of an insurer. d. Making a statement before the public about any person in the conduct of his insurance business that is untrue.
b. Committing any act of discrimination whether it be deemed fair or unfair.
Under the Consolidated Omnibus Budget Reconciliation Act (COBRA), which of the following is a qualifying event? a. Promotion b. Divorce c. Marriage d. Relocation
b. Divorce
Insureds are entitled to recover an amount NOT greater than the amount of their loss under the principle of a. Adhesion. b. Indemnity. c. Utmost good faith d. Warranty.
b. Indemnity.
Which of the following describes an insurer who has enough financial resources only to provide for all of its liabilities and for all reinsurance of all outstanding risk? a. Guaranteed b. Insolvent c. Solvent d. Nonparticipating
b. Insolvent
All of the following qualify as Background Information as defined in Section 1729.2 of the California Insurance Code, EXCEPT a. A misdemeanor or felony conviction or a filing of felony criminal charges in state or federal court. b. Misdemeanor charges. c. An administrative action regarding a professional or occupational license. d. Any admission, or judicial finding or determination, or fraud, misappropriation or conversion of funds, misrepresentation, or breach of fiduciary duty.
b. Misdemeanor charges.
What is the definition of premium? a. Bonus paid by an agent to convince an insured to buy a policy. b. Money an insured pays an insurer to obtain the benefits provided in the policy. c. Money an insurer pays to an insured to obtain the benefits provided in the policy. d. Amount the insured pays per unit of coverage(e.g.,$10 per $1,000 of coverage)
b. Money an insured pays an insurer to obtain the benefits provided in the policy.
What is meant by referring to an insurance policy as a unilateral contract? a. One party may receive more that the other party. b. Only one party makes a legally enforceable promise. c. One party draws up the contract and the other accepts it. d. The obligation of one party depends on the performance of obligations by the other party.
b. Only one party makes a legally enforceable promise.
Insurer expenses include all of the following EXCEPT a. Taxes. b. Policy premiums. c. Agent commissions. d. Home office operations.
b. Policy premiums.
Insurer policy expenses include all of the following EXCEPT a. Taxes. b. Premiums. c. Agent commissions. d. Home office operations.
b. Premiums.
Loss retention is an effective risk management technique when all of the following conditions exist EXCEPT the a. Losses are highly predictable. b. Probability of loss is unknown. c. Worst possible loss is not serious. d. Insured chooses to assume the losses involved.
b. Probability of loss is unknown.
Unless it is merely a statement of an expectation or belief, a representation as to the future is considered which of the following? a. Liability b. Promise c. Provision d. Restriction
b. Promise
Which insurance policy pays on the death of the second insured? a. Joint life b. Survivorship life c. Limited payment Whole Life d. Family Policy
b. Survivorship life
Risk can be defined as all of the following EXCEPT a. Uncertainty b. The cause of loss. c. The chance of loss. d. The probability of an unexpected outcome.
b. The cause of loss.
Risk can be defined as all of the following EXCEPT a. Uncertainty. b. The cause of loss. c. The chance of loss. d. The probability of an unexpected outcome.
b. The cause of loss.
The purchase of an insurance policy may accomplish all of the following for the insured EXCEPT a. Reduction of uncertainty. b. The elimination of the risk c. A replacement of a large possible loss by a "smaller certain loss" d. A reduction in worry/greater peace of mind.
b. The elimination of the risk
The purchase of an insurance policy may accomplish all of the following for the insured EXCEPT a. A reduction of uncertainty. b. The elimination of the risk. c. A replacement of a large possible loss by a "smaller certain loss". d. Reduction in worry/greater peace of mind.
b. The elimination of the risk.
All of the following are requirements of a contract EXCEPT a. The contract must have a legal purpose b. There must be equal consideration between the parties. c. The parties to the contract must be legally competent. d. There must be an offer and acceptance of the contract terms.
b. There must be equal consideration between the parties.
The process by which an insurer decides whether to issue requested insurance is called a. Adverse selection b. Underwriting c. Application. d. Competition.
b. Underwriting
According to the California Insurance Code, if an insurer's certificate of authority is revoked, the Commissioner can proceed with any of the following actions EXCEPT a. Taking possession of transaction records. b. Using Guarantee Funds to pay salaries. c. Confiscating the office premises d. Liquidating the business.
b. Using Guarantee Funds to pay salaries.
According to the California insurance Code, if an insurer's certificate of authority is revoked, the Commissioner can proceed with any of the following actions EXCEPT a. Taking possession of transaction records. b. Using Guarantee Funds to pay salaries. c. Confiscating the office premises. d. Liquidating the business.
b. Using Guarantee Funds to pay salaries.
Due to the Affordable Care Act, at what age can dependent adult child stay on the family health plan? a. 21 b. 18 c. 26 d. 24
c. 26
Section 1729.2 of the California Insurance Code requires insurance producer applications and licensees to notify the Insurance Commissioner in writing, within __________days of changes in background information after an application has been submitted or license has been issued. a. 15 b. 20 c. 30 d. 45
c. 30
When a person charges an insured a fee to review the insured's existing life policy, what type of license does that person need? a. A life agent. b. A personal lines agent. c. A life and disability analyst. d. A life or disability adjuster.
c. A life and disability analyst.
Any situation that presents the possibility of a loss is known as a. Consideration. b. A covered loss. c. A loss exposure. d. Medical loss ratio.
c. A loss exposure.
It is considered an unfair method of competition for an agent to advertise that the insurer the agent is appointed with is a. Highly rated by A.M. Best Company. b. An admitted insurer in the state of California. c. A member of the insurance Guarantee Association. d. Fully authorized by certification to sell insurance.
c. A member of the insurance Guarantee Association.
Which type of insurer is owned by its policyholders? a. A fraternal society. b. A reciprocal exchange. c. A mutual insurer. d. A capital stock insurer.
c. A mutual insurer.
An insurer entitled to transact business by complying with the California Insurance Code is known as an a. Alien carrier. b. Approved carrier. c. Admitted carrier. d. Accepted carrier.
c. Admitted carrier.
A contract that restores an injured party to the condition that was present before the loss is a. A futures contract. b. A personal contract. c. An indemnity agreement. d. A hold-harmless agreement.
c. An indemnity agreement.
How often MUST an insurer file the National Association of Insurance Commissioners (NAIC) financial statement? a. Monthly. b. Quarterly. c. Annually. d. Every three years.
c. Annually.
All of the following are characteristics of reinsurance EXCEPT it a. Increases underwriting capacity. b. Stabilizes an insurer's profits. c. Increases the unearned premium reserve. d. Provides protection against a catastrophic loss.
c. Increases the unearned premium reserve.
A person authorized by and on behalf of an insurer who transacts life, disability or life and accident and health insurance is defined as a a. Broker. b. Solicitor. c. Life agent. d. Life and disability analyst.
c. Life agent.
In insurance terminology, "indemnity" means a. Award. b. Advance. c. Make whole. d. Over compensate.
c. Make whole.
A person who acts, offers to act, or assumes to act in a capacity where a license is REQUIRED without having a valid license, is guilty of a a. Felony b. Fraud c. Misdemeanor d. Misrepresentation.
c. Misdemeanor
It is a federal offense for an insurance agent to do all of the following EXCEPT a. Falsify financial records. b. Embezzle premium payments. c. Misrepresent facts on an insurance application. d. Willfully engage in the business of insurance with a felony conviction and without the consent of the commissioner.
c. Misrepresent facts on an insurance application.
The increase in the probability of a loss resulting from an insured's dishonest tendencies is known as a. Physical hazard. b. Morale hazard. c. Moral hazard. d. Legal hazard.
c. Moral hazard.
If the owner of a life insurance policy has a payment term of is annually, which of the following statement is true? a. The premium is the same if pay monthly b. Pay more on quarterly than semi-annually c. Pay more semi-annual than annually d. Pay a reduced amount if paid earlier in the year rather than at the end of the period of coverage, as it is customary
c. Pay more semi-annual than annually
If an insurer must have its rates accepted by the Insurance Department prior to using them, the insurer would be operating in which of the following types of jurisdictions? a. File and use. b. Use and file. c. Prior approval d. State mandated.
c. Prior approval
The California Code of Regulations governing claim settlement practices prohibits all of the following acts of unfair discrimination EXCEPT denial of claim based on a. Gender b. Income. c. Reckless behavior. d. A physical handicap.
c. Reckless behavior.
A situation in which there is a possibility of loss or a gain is a a. Pure risk. b. Particular risk. c. Speculative risk. d. Fundamental risk.
c. Speculative risk.
The direct response distribution of insurance utilizes all of the following to promote the sale of insurance EXCEPT a. Internet advertising. b. Television commercials. c. Telephone call from an agent. d. Brochures mailed to prospective clients.
c. Telephone call from an agent.
Which of the following is an express power given to the agent in an agency agreement? a. The authority to advertise. b. The authority to collect premiums. c. The authority to represent the insurer. d. The authority to bind the insurer any risk at any time.
c. The authority to represent the insurer.
All of the following statements about aleatory contracts are true EXCEPT a. They may be interpreted as a form of gambling. b. There are cases where the insurer pays nothing. c. The insured and insurer contribute equally to the contract. d. If a loss occurs, the insured's premium is small in relation to amount the insurer pays.
c. The insured and insurer contribute equally to the contract.
All of the following statements about aleatory contracts are true EXCEPT a. They may be interpreted as a form of gambling. b. There are cases where the insurer pays nothing. c. The insured and insurer contribute equally to the contract. d. If a loss occurs, the insured's premium is small in relation to the amount the insurer pays.
c. The insured and insurer contribute equally to the contract.
What rule is used to determine the importance of a representation? a. The law of adhesion. b. That of aleatory contracts. c. The materiality of concealment. d. The insurable interest standard.
c. The materiality of concealment.
In group life insurance, who is issued a certificate of insurance? a. The insurer. b. The beneficiary. c. The participant. d. The policyholder.
c. The participant.
The required contents of a policy include all of the following EXCEPT a. Risks insured against. b. Parties to the contract. c. The probability of loss. d. The period during which the insurance is to continue.
c. The probability of loss.
All of the following statement about contingent beneficiaries are true EXCEPT a. They receive remaining payments to be made under a settlement agreement upon the primary beneficiary's death b. The contingent beneficiary shares death proceeds equal to the primary beneficiary c. They receive death proceeds if the primary beneficiary is deceased at the time of the insured's death d. More than one contingency beneficiary may be named
c. They receive death proceeds if the primary beneficiary is deceased at the time of the insured's death
What is the goal of the underwriting process? a. To compute the premium rates for insureds. b. To select only risks that will not incur losses. c. To avoid selecting a disproportionate number of bad risks. d. To ensure that the company pays any incurred losses promptly.
c. To avoid selecting a disproportionate number of bad risks.
Which of the following is a hazard? a. A peril. b. A speculative risk. c. A large number of similar exposure units. d. A condition that may increase the likelihood of loss occurring.
d. A condition that may increase the likelihood of loss occurring.
All of the following information is gathered during the personal financial planning process EXCEPT a. Information regarding an individual's investments. b. A listing of the individual's assets and liabilities. c. Information regarding a person's income and expenditures. d. A listing of a person's civic and professional organization memberships.
d. A listing of a person's civic and professional organization memberships.
Failure to report background changes within 30 days as required under section 1729.2 of the California Insurance Code could subject a licensee or applicant to a. Suspension. b. Denial. c. Revocation of the license. d. All of the above.
d. All of the above.
An insurance solicitor is a person authorized to a. Sell life insurance. b. Charge a service fee. c. Act as a broker on behalf of an insurer. d. Assist a broker or agent in selling insurance.
d. Assist a broker or agent in selling insurance.
When must insurance records of insurance agents and brokers be made available to the insurance commissioner? a. Within 30 days of written request by the commissioner. b. After the policy is issued. c. Annually and submitted with the proper paperwork. d. At all times.
d. At all times.
Moral hazard can be defined as the increase a. In frequency and severity of losses covered by insurance. b. Of losses arising from legal precedents created by the courts. c. Chance of a loss occurring due to the insured's carelessness. d. Chance of a loss occurring due to an insured's dishonest tendencies.
d. Chance of a loss occurring due to an insured's dishonest tendencies.
Moral hazard can be defined as the increase a. In frequency and severity of losses covered by insurance. b. Of losses arising from legal precedents created by the courts. c. Chance of loss occurring due to the insured's carelessness. d. Chance of a loss occurring due to an insured's dishonest tendencies.
d. Chance of a loss occurring due to an insured's dishonest tendencies.
According to the California Insurance Code, an "insurance broker" is a. Authorized by an insurer to transact insurance. b. Employed to assist an insurance agent in transacting insurance. c. Hired by an insured to give advice about insurance transactions. d. Compensated for transacting insurance on behalf of another person with an insurer.
d. Compensated for transacting insurance on behalf of another person with an insurer.
The PRIMARY objectives of insurance regulation include all of the following EXCEPT a. Rate regulation. b. Consumer protection. c. Solvency surveillance. d. Interpret policy provisions.
d. Interpret policy provisions.
Who are the members of the Medical Information Bureau? a. Hospitals. b. Physicians. c. Medical Bill Reviewers. d. Life and Health insurers.
d. Life and Health insurers.
Who are members of the medical information bureau? a. Hospitals. b. Physicians c. Medical bill reviewers. d. Life and health insurers.
d. Life and health insurers.
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 following are automatically acceptable for Mary Brown, a holder of the CLU designation? a. Mary Brown, CLU and Company. b. Brownies' insurance services. c. Mary Brown insurance company. d. Mary Brown insurance services.
d. Mary Brown insurance services.
When are parties to a contract REQUIRED to communicate information solely based on personal judgment for a matter in question? a. Only when the policy terms require it. b. Only when relevant. c. Only when asked. d. Never.
d. Never.
When used in the California insurance code the word "may" is intended be a. Final. b. Mandatory. c. Optional. d. Permissive.
d. Permissive.
Which of the following information is not required to be communicated in a life insurance contract? a. Applicant's name. b. Occupation. c. Financial information. d. Personal judgment.
d. Personal judgment.
The Pregnancy Discrimination Act has which of the following effect? a. Pregnancy can be excluded from coverage b. Pregnancy must be covered by with lower benefits than other conditions c. The employer must provide at least 4 weeks of paid leave with health benefits after delivery d. Pregnancy must be treated the same as any other condition
d. Pregnancy must be treated the same as any other condition
Which is an agreement in which an insurer contracts with a third party to insure itself against losses from insurance policies it issues? a. Adhesion. b. Avoidance. c. Indemnity. d. Reinsurance.
d. Reinsurance.
What recourse does an insurer have if violation of a material warranty on the part of the insured is discovered? a. Hearing by the insurance Commissioner to determine the severity of the misrepresentation and to determine appropriate courses of action. b. Hearing by a court of law to determine the appropriate course of action the insurer may take. c. None, if discovered after the policy has been in force for 12 months. d. Rescission of the policy.
d. Rescission of the policy.
Policies covered under the California Life and Health Insurance Guarantee Association include all of the following EXCEPT a. Disability income. b. Individual health. c. Deferred annuities. d. Self-funded group life.
d. Self-funded group life.
An individual with low income and high insurance need should buy? a. Whole life insurance b. Universal life insurance c. Endowment insurance d. Term insurance
d. Term insurance
Making an insured whole by restoring them to the same condition as before a loss is an example of a. Reinsurance. b. The retention of risk. c. Fiduciary responsibility. d. The principle of indemnity.
d. The principle of indemnity.
Which of the following is a requirement of a contract? a. It must be in writing. b. There must be equal consideration between parties. c. There must be negotiation of the terms between parties. d. There must be an offer and acceptance of the contract terms.
d. There must be an offer and acceptance of the contract terms.
The insurer's department with PRIMARY responsibility for the risk selection process is called: a. Actuarial. b. Claims. c. Marketing. d. Underwriting.
d. Underwriting.
What is it called when an insurer uses higher rates for an individual solely based on religion, race, or ethnic group? a. Redlining. b. Categorizing. c. Social injustice. d. Unfair discrimination.
d. Unfair discrimination.
