An intermediary may receive compensation for insuring the intermediary's self ONLY if

• A. during the prior year the intermediary sold other insurance with the same company with total premiums exceeding the premiums on the intermediary's own risks
• B. the intermediary is licensed but not from Wisconsin
• C. the premiums on the intermediary's own life are higher than a threshold
• D. the company has a rating of A or better

Answer: (A)

Some rules limit paying an intermediary for a policy written on the intermediary’s own life or risks unless there is real business activity with that insurer beyond the self-covered policy. The requirement is that, in the prior year, the intermediary must have sold other insurance with the same company and the total premiums from those other policies must exceed the premiums on the intermediary’s own risks. This shows the intermediary isn’t just insuring themselves to gain compensation, but has substantial legitimate business with the insurer, justifying pay for the self-insured policy.

The other options don’t fit because they don’t address the necessary ongoing business relationship with the insurer. Licensure location, a rating threshold for the company, or a relative premium amount on the intermediary’s own life do not establish the required level of other insured business with the same insurer.