Exam (elaborations)
WISCONSIN ACCIDENT & HEALTH INSURANCE EXAM 2024
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WISCONSIN ACCIDENT & HEALTH INSURANCE EXAM 2024
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WISCONSIN ACCIDENT & HEALTH INSURANCE EXAMDividends from a stock company are normally sent to:
Beneficiaries
Shareholders
Policy holders
Insureds - Answers -Shareholders
Which of the following financial products creates an instant estate, no matter when the
date of death?
Mutual funds
Life insurance
Certificate of deposit
Deferred annuity - Answers -Life insurance
Which of the following outlines the authority given to the producer on behalf of the
insurer?
Rebating arrangement
Commingling contract
Controlled business clause
Producer contract - Answers -Producer contract
Dividends from a mutual insurance company are paid to whom?
Policyholders
Beneficiaries
Preferred stockholders
Stockholders - Answers -Policyholders
A stock insurance company is owned by its
Officers
Board directors
Policyowners
Shareholders - Answers -Policyowners
A reciprocal insurer typically has an administrator who manages the premiums collected
from the group's members. This administrator is called a(n)
Reciprocal commissioner
Attorney general
Attorney-in-fact
Reciprocal - Answers -Attorney-in-fact
which reinsurance contract between two insurers involves an automatic sharing of the
risks assumed?
Arbitrage reinsurance
Facultative reinsurance
Excess reinsurance
,Treaty reinsurance - Answers -Treaty reinsurance
A group-owned insurance company that is formed to assume and spread the liability
risks of its members is known as a
Risk retention group
Treaty insurer
Risk assumption group
Captive insurer - Answers -Risk retention group
Which group is the Do not Registry designed to protect against?
Telemarketers
Charities
Political organizations
Relatives - Answers -Telemarketers
who regulates an insurer's claim settlement practices?
National Association of Claim Adjusters
State attorney general
National Association of insurance Commissioners
State insurance departments - Answers -State insurance departments
Which of the following is Not an example of risk retention?
Becoming aware of a risk and taking no action
Self-insuring a given risk
Deciding a business deal is risky but going through with it anyways
Not doing a business deal after deciding it would be too risky - Answers -Not doing a
business deal after deciding it would be too risky
Which of the following describes the act of insuring a risk against possible loss?
Risk avoidance
Risk transfer
Hazard reduction
Loss management - Answers -Risk transfer
ABC Company is attempting to minimize the severity of potential losses within its
company. The company is engaged in risk
Transference
Retention
Reduction
Avoidance - Answers -Reduction
Which of these statements regarding insurance is false?
One way insurers deal with catastrophic loss is through reinsurance
As the number of insured units increases, the number of losses decreases
Speculative risk cannot be insured
,Pure risk can be insured - Answers -As the number of insured units increases, the
number of losses decreases
Purchasing insurance is an example of risk
Transference
Avoidance
Retention
Sharing - Answers -Transference
A business becoming incorporated is an example of risk
Reduction
Severance
Retention
Transfer - Answers -Transfer
How can an insurance company minimize exposure to loss?
Risk concealing
Reinsuring risks
Reissuance
Risk assumption - Answers -Reinsuring risks
An insurable risk requires
That the chance for both a loss or gain exists
The loss must be catastrophic
That the chance of loss be calculated
that the loss must be incalculable - Answers -That the chance of loss be calculated
which of these do NOT indicate the presence of insurable interest in a life insurance
contract?
Lifelong friendship
Marriage
Blood-related
Co-owning a business - Answers -Lifelong friendship
An insurance contract may be voided if a misrepresentation found on the application is
determined to be
Conditional
Aleatory
Material
Intentional - Answers -Material
A contract is considered void in all of the following situations EXCEPT
When one party is a minor
When consideration is unequal
When consideration is incomplete
, When agreement cannot be reached between parties - Answers -When consideration is
unequal
An insured is entitled to coverage under a policy that a prudent person would expect it
to provide. This principle is called
Adhesion
Reasonable sensibility
Reasonable expectations
Insurable interest - Answers -Reasonable expectations
Use of XYZ Insurance Company brochures, business cards, and rating guides is an
example of
Expresses authority
Implied authority
Apparent authority
Fiduciary duty - Answers -Apparent authority
Ambiguities in insurance contracts are typically interpreted in favor of the insured. This
rule is referred to as
Subrogation
Reasonable expectations
Insurable interest
Adhesion - Answers -Reasonable expectations
An appointed producer's implied authority is derived from
The NAIC
Express authority
The insurer's Certificate of Authority
Evident authority - Answers -Express authority
Which of these is true regarding the exchange of consideration among parties involved
in an insurance contract?
Required to be in currency
Must be equal
Can be unequal
Must be certified by the state where transaction takes place - Answers -Can be unequal
An agent whose actions exceed the authority granted by contract is
Acting under apparent authority
Acting under Implied authority
Not backed by the insurer
Backed by the insurer - Answers -Not backed by the insurer
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