Which statement describes the condition under which an intermediary may receive a commission on business written on the intermediary's own life?

• A. It is allowed if the intermediary is a licensed life agent in Wisconsin and has sold insurance with the same company during the prior year with total premiums exceeding the premium on the intermediary's own life
• B. It is allowed if the intermediary is licensed but has not engaged in prior year activity
• C. It is never allowed
• D. It is allowed only if the premiums on the intermediary's own life exceed those of the other policies

Answer: (A)

This is about preventing a conflict of interest when an agent earns a commission on a policy written on their own life. In Wisconsin, the rule allows this only if the agent is licensed and has demonstrated genuine business production with the same company beyond their own policy. Specifically, the agent must have sold insurance with that company in the prior year, and the total premiums from those sales must exceed the premium for the agent’s own life policy. This ensures commissions reflect actual business activity with the company rather than just the personal policy.

If there’s no prior-year activity, or if the agent’s own life premium is not outweighed by the company’s other business, the commission on the own-life policy wouldn’t be allowed. The other options miss the production requirement or state the wrong condition, whereas the stated rule ties eligibility to meaningful production with the insurer.