Insurance Regulations
A producer has been convicted of a felony. How will that affect the producer's license?
The license may be revoked immediately. Any type of fraud or misrepresentation is a violation that may cause a license to be denied, suspended or revoked. If a producer is convicted of a felony, the Commissioner may revoke or refuse to renew the producer's license immediately and without hearing if the facts leading to the conviction show the licensee to be untrustworthy.
The term "producer" refers to any person appointed by an insurer to
Solicit applications for insurance on its behalf.
Group life insurance policies delivered in this state must contain all of the following provisions EXCEPT
Statements of the applicant are considered warranties. No policy of group life insurance can be delivered in this state unless it contains the following provisions, among others: the policyholder is entitled to a grace period of 31 days; the validity of the policy cannot be contested, except for nonpayment of premiums, after it has been in force for 2 years; a copy of the application must be attached to the policy. Statements of the applicant are considered representations, not warranties.
Which of the following statements is correct regarding the separate account for collected premiums established and maintained by a producer?
The account may be interest bearing. The separate account may be interest-bearing, and interest earned on the deposits held in the separate account may be retained by the producer and used to offset bank charges, establish reserves, pay return premiums, or for any of the purposes permitted by the Insurance Code.
How many hours of ethics education are producers required to complete every licensing period?
3 hours ! A producer must complete 24 hours of CE, including 3 hours in ethics.
When a policy is replaced, replacing insurers must maintain a replacement register regarding that policy for
3 years. When a policy is to be replaced, replacing insurers must maintain copies of the replacement notice, all required written communications, the applicant's signed statement regarding replacement and a replacement register in their home office for at least 3 years, or until the conclusion of the next regular examination by the Insurance Department, whichever is later.
Any life insurance policy that accumulates cash values must include a provision for policy loans after a certain period of time. In the state of Washington, that period of time is
After 3 full years of premium payments. Any life insurance policy that accumulates cash values must include a provision for policy loans after 3 full years of premium payments.
Which of the following will NOT be considered unfair discrimination by insurers?
Discriminating in benefits and coverages based on the insured's habits and lifestyle Discriminating between individuals of the same class with equal life expectancies, or by reason of race, nationality, or ethnic group would be considered unfair discrimination. Insurers are also not allowed to cancel individual coverage due to a change in marital status. Discriminating in benefits based on the insured's habits and lifestyle (such as smoking or dangerous hobbies) is acceptable.
If a policyowner returns the life insurance policy to the insurer within 10 days of policy delivery, the policyowner is entitled to
Full refund.
The Commissioner of Insurance does NOT have the authority to
Set rates. The Commissioner has the authority and the duty to review and approve or disapprove any policy forms or rates. The Commissioner, however, does not set rates; those are established by law.
How often are producers in this state required to pay license renewal fees?
Once a license is issued, it is the licensee's responsibility to maintain an active status by completing continuing education and paying renewal fees. Renewal fees for producers are due every 2 years.
Under the Fair Credit Reporting Act, if a consumer challenges the accuracy of the information contained in a consumer or investigative report, the reporting agency must
Respond to the consumer's complaint. The consumer has the right to request the information on the report, the reasons for turn down and any adverse underwriting decisions. The reporting agency is required to respond to the consumer's complaint, and, if necessary, to reinvestigate the report.
During policy delivery, insurance producers are allowed to do all of the following EXCEPT
Retain the policy for safekeeping. The Insurance Code requires that policies be delivered within a reasonable period of time after issuance. Insurance producers delivering insurance policies to insureds must make an actual physical delivery. It is not acceptable for a producer to merely obtain a receipt indicating a delivery and then to retain the policy for safekeeping. Producers may obtain and hold policies briefly for analysis or servicing.
Which of the following qualifications is required for producers who want to sell annuities in this state?
A life insurance license and a 4-hour training course A producer may sell, solicit, or negotiate the sale of annuity contracts only if appropriately licensed as an insurance producer and has successfully completed a one-time, 4-hour annuity suitability training.
Which of the following is an agreement between an insured and an insurer, where the insurer agrees to indemnify the insured for specific losses in exchange for a premium?
The insurance contract Insurance contracts are defined as the agreements made between an insured and an insurer, where the insurer promises to indemnify the insured for covered losses, in exchange for a premium. Both parties are bound by the conditions of the contract.
