State Laws, Rules, and Regulations Quizzes

An agent accepts the premium payment 35 days after it is due, telling the insured that there will not be a problem keeping the policy in force. This is an example of what type of agent authority? Implied Assumed Apparent Express

Apparent An agent who accepts a premium after the end of the grace period appears to the client to have the authority to prevent the policy from lapsing. In fact, the agent has no such power.

All the following are examples of violations of replacement EXCEPT -Failing to ask the applicant questions regarding replacement. -Intentionally answering a question incorrectly. -Advising an applicant to answer questions correctly. -Any deceptive or misleading information.

-Advising an applicant to answer questions correctly. An agent must advise an applicant to answer questions correctly.

Which types of policies must provide for newborns, from the moment of birth, with all health insurance benefits applicable to children until 31 days? Individual accident and sickness Group accident and sickness Both individual and group accident and sickness Group life only

Both individual and group accident and sickness Individual and group accident and sickness policies that cover family members of the insured must also provide for newborns, from the moment of birth, with all health insurance benefits applicable to children until 31 days.

Which of the following are the authorities that an agent can hold? Primary and secondary Express and implied Apparent and allowed Authorized and admitted

Express and implied The powers and authorities that an agent holds are express and implied. Apparent authority is the appearance of, or the assumption of, authority based on the actions, words, or deeds of the principal or because of circumstances the principal created.

Which of the following is required of an insurer in order to legally transact insurance in Georgia? Insurer's certificate Agent's license Certificate of authority Decree of power

Certificate of authority No person can act as an insurer, and no insurer can transact insurance in Georgia, unless properly authorized by a current and valid certificate of authority issued by the Commissioner, except for transactions expressly otherwise provided for in the Insurance Code.

Abbey is adopted on May 1, 2003. When will her health benefits go into effect? May 1 By June 1 By July 1 By August 1

May 1 Coverage for adopted children must be effective at the date of the final decree of adoption.

All of the following statements regarding continuing education requirements in this state are true EXCEPT -Excess hours may be carried over to the next licensing period. -Producers may repeat the same courses to meet the required CE hours for a licensing period. -CE hours must be completed every 2 years by the last day of the producer's birth month. -Ethics education is required every licensing period.

-Producers may repeat the same courses to meet the required CE hours for a licensing period. The licensees may not repeat the same CE courses in the same renewal period. All the other statements are true.

In any case where there is a controversy or dispute between the insurance company and the insured, the soliciting agent is the agent of the Applicant. Insured. Company. Beneficiary.

Company An agent's license authorizes them to represent an insurance company, not the insured.

An insurance company has published a brochure that inaccurately portrays the advantages of a particular insurance policy. What is this an example of? False advertising Unfair claims Twisting Defamation

False advertising False advertising is the illegal practice of advertising or circulating materials that are untrue, deceptive, or misleading.

How long after receiving notice of a claim does an insurer have to furnish proof of loss forms? Immediately upon receipt of notice Within 30 days Within 3 weeks Within 10 days

Within 10 days The insurer has 10 working days to furnish claim forms.

All of the following actions can be described as twisting EXCEPT -Making an incomplete comparison between the existing and proposed policies -Explaining to client the advantages of permanent insurance over term and suggesting changing policies -Misrepresenting the terms and conditions of the existing policy to make the new one more attractive -Embellishing the terms of the proposed policy in order to convince the insured to switch

-Explaining to client the advantages of permanent insurance over term and suggesting changing policies Twisting is a misrepresentation, or incomplete or fraudulent comparison of insurance policies that persuades an insured/owner, to his or her detriment, to cancel, lapse, or switch policies from one to another.

Individual and group accident and sickness policies that cover what kinds of losses must also provide for newborns, from the moment of birth, with all health insurance benefits applicable to children? -Specified child-related losses -Health-related losses for the mother -Maternity losses -Losses that happen to family members

-Losses that happen to family members Individual and group accident and sickness policies that cover family members of the insured must also provide for newborns, from the moment of birth, with all health insurance benefits applicable to children until 31 days.

The duty (or duties) of an agent where replacement is involved include -Leaving a copy or original of all solicitation material used for presentation to the applicant. -Submitting to the replacing insurer a copy of all soliciting material. -Submitting to the replacing insurer a statement signed by the applicant as to whether or not he has existing life insurance. -All of the above

-All of the above Most states have adopted the NAIC model act on the replacement of policies. Insurers are required to inform its agents of the requirements of this regulation into all relevant agent-training manuals and institute procedures to confirm that the requirements of the regulation are met.

Which of the following is responsible for determining whether an advertisement might mislead or deceive a person of average education and intelligence? Commissioner NAIC Consumer Protection Agency Federal Insurance Regulation Board

Commissioner The Commissioner is responsible for determining whether an advertisement might mislead or deceive a person of average education and intelligence.

An insurer publishes intimidating brochures that portray the insurer's competition as financially and professionally unstable. Which of the following best describes this act? -Legal, provided that the information can be verified -Illegal until endorsed by the Guaranty Association -Legal, provided that the other insurers are paid royalties for the usage of their names -Illegal under any circumstances

-Illegal under any circumstances When a company criticizes the financial situation of another company, with the intention of injuring that company, it has committed an illegal trade practice called "defamation."

Whenever agents submit applications to insurers, they must also submit statements disclosing whether or not replacement is involved. Who must sign these statements? Applicant only Agent only Applicant and agent Applicant, agent, and executive officer of the insurance company

Applicant and agent Whenever agents submit applications to insurers, they must also submit statements, signed by the applicant and agent, disclosing whether or not replacement is involved.

An insurance company is domiciled in Montana and transacts insurance in Wyoming. Which term best describes the insurer's classification in Wyoming? Alien Domestic Unauthorized Foreign

Foreign A foreign insurer is domiciled in one state and transacts insurance in another. A domestic insurer transacts insurance in the domicile state (in this case, Montana). An alien insurer is domiciled in one country and transacts insurance in another.

In replacement, an existing insurer must provide policyowners with a policy summary for existing life insurance within how many days of receiving the written communication and replacement? 3 10 31 60

10 Existing insurers must provide policyowners with a policy summary for the existing life insurance within 10 days of receiving the written communication and replacement.

When a policy is replaced, replacing insurers must maintain a replacement register regarding that policy until the conclusion of the next regular examination by the Insurance Department or for 5 years. 4 years. 2 years. 3 years.

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.

A child is born to a mother whose insurance covers health-related losses of family members. How long with the newborn be automatically covered under the mother's plan? 31 days 3 months 6 months Until the child is no longer a dependent

31 days Individual and group accident and sickness policies that cover family members of the insured must also provide for newborns, from the moment of birth, with all health insurance benefits applicable to children until 31 days.

What documentation grants express authority to an agent? Agent's insurance license Fiduciary contract State provisions Agent's contract with the principal

Agent's contract with the principal The principal grants authority to an agent through the agent's contract.

A claimant wants to bring a recovery action against an insurance company for a loss claimed under a policy. The action must be brought Only within 60 days. No later than within 2 years. Within 3 years. Immediately.

Within 3 years Some states require a provision limiting the time parameters in which a claimant may seek recovery from an insurer under a policy. Georgia requires legal actions to be brought forth no sooner than 60 days and no later than 3 years after proof of loss.

Qualifications for soliciting, selling or negotiating a partnership policy include all of the following EXCEPT -Completing an initial 8-hour training. -Completing ongoing 4-hour training every 24 months. -Obtaining a partnership policy license from the Commissioner. -Being appointed.

-Obtaining a partnership policy license from the Commissioner. There is no partnership policy license. A producer must be appointed, complete an initial 8-hour training and ongoing 4-hour training every 24 months.

Insurers must keep files of all advertisements used in Georgia for how many years? 2 4 6 9

4 Insurers must keep files of all advertisements used in Georgia, which must note the manner and extent of distribution and the form number of any advertised policy. These files are subject to inspection by the Insurance Department and must be kept either for 4 years or until the next regular examination by the Department.

Whenever agents submit applications to insurers, they must also submit statements, signed by the applicant and agent, disclosing the involvement or lack of involvement of A change in policy amount. Replacement. A change of health. An inducement.

Replacement Whenever agents submit applications to insurers, they must also submit statements, signed by the applicant and agent, disclosing whether or not replacement is involved.

Health benefits will extend past the normal dependent child age limit because he/she is chiefly dependent on the policyholder for support and maintenance, along with what other qualification? Mental retardation Physical handicap There are no other requirements. Either Mental retardation or Physical handicap.

Either Mental retardation or Physical handicap. All individual and group hospital and medical expense insurance policies that provide coverage for dependent children must generally terminate coverage for the children when they have reach the limiting age of dependence 19. Coverage doesn't terminate for children who continue to be both incapable of employment because of mental retardation or physical handicap and chiefly dependent upon the policyholder for support and maintenance.

Agents who persuade insureds to cancel a policy in favor of another one when it might not be in the insured's best interest are guilty of Misrepresentation. Rebating. Twisting. Defamation.

Twisting. Twisting is a misrepresentation that persuades an insured or a policyowner, to his or her detriment, to cancel, lapse, or switch policies.

Slightly misleading statements in an advertisement are excusable -If the policy is made available to the prospective insured for inspection. -If the policy is issued with an offer to refund premium if the purchaser is not satisfied. -A & B -Under no circumstances.

-under no circumstances The fact that the policy is made available to the prospective insured for inspection, with an offer to refund premium if the purchaser is not satisfied, does not excuse misleading statements.

If an agent changes his residence address, within how many days must the agent notify the Commissioner of the change? 10 days 15 days 30 days 60 days

30 days The Commissioner must be notified of any changes of names or addresses (including business and residential) within 30 days of the change.

What is the major difference between a Stock Company and a Mutual Company? Types of whole life policies Ownership Amount of death benefit Number of producers

Ownership Mutual companies are owned by policyholders, while stock companies are owner by stockholders.

All of the following are examples of transacting insurance in Georgia EXCEPT -Insurance solicitation. -Preliminary insurance negotiations. -Making an insurance contract go into effect. -None of the above. All are examples of transacting insurance.

-None of the above. All are examples of transacting insurance. Any of the following acts is considered to constitute an act of "transacting insurance" in Georgia: solicitation and inducement to insurance, preliminary insurance negotiations, effectuation of an insurance contract, and transactions of matters subsequent to and arising out of effectuation of an insurance contract.

Mike works for a company that offers a family health benefit plan. His daughter turns 18. Which of the following is true? -Her coverage has terminated. -Her coverage will continue but for a fee. -Her coverage will continue, but pre-existing conditions will be excluded from coverage. -She will still be covered under the plan.

-She will still be covered under the plan. All individual and group hospital and medical expense insurance policies that provide coverage for dependent children must generally terminate coverage for the children when they have reach the limiting age of dependence 19. Coverage doesn't terminate for children who continue to be both incapable of employment because of mental retardation or physical handicap and chiefly dependent upon the policyholder for support and maintenance.

What is the dependent child age limit in Georgia? 16 18 19 21

19 All individual and group hospital and medical expense insurance policies that provide coverage for dependent children must generally terminate coverage for the children when they have reach the limiting age of dependence (19) specified in the policy.

An insured purchased an insurance policy 5 years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insurer. From what type of insurer did the insured purchase the policy? Reciprocal Nonprofit Service Organization Stock Mutual

Mutual Funds not paid out after paying claims and other operating costs are returned to the policyowners in the form of a dividend. If all funds are paid out, no dividends are paid.

How often does an agent's insurance license expire? Every 2 years Every 3 years The license is perpetual. Annually

Every 2 years Licenses expire every 2 years on the last day of the licensee's birth month.

Individual and group accident and sickness policies that cover what kinds of losses must also provide for newborns, from the moment of birth, with all health insurance benefits applicable to children? Maternity losses Losses that happen to family members Specified child-related losses Health-related losses for the mother

Losses that happen to family members Individual and group accident and sickness policies that cover family members of the insured must also provide for newborns, from the moment of birth, with all health insurance benefits applicable to children until 31 days.