IL Statutes and Regulations Common to All Line[25%]

C

Which of the following is an example of a producer's fiduciary responsibilities? A. A producer doing a review of his or her client's coverage B. A producer offering additional coverages to his client C. A producer promptly forwarding premiums to the insurance company D. A producer helping clients to file claims

D

A producer failed to complete the required continuing education credit hours for this compliance period, and allowed his license to lapse. Within what time period after the deadline may the license be reinstated? A. 30 days B. 90 days C. 6 months D. 12 months

C

All of the following are prohibited practice EXCEPT A. Discrimination based on nation origin B. Refusing to insurer an applicant solely because of his military status C. Denial of a claim after an investigation D. Permitting rate distinctions based on the applicant's disability

D

All of the following are regulated area of the insurance industry EXCEPT A. Procedure B. Trade practice C. Investments D. Commissions

C

All of the following are true regarding rebates EXCEPT A. Rebating can be anything of economic value, given as an inducement to buy B. Dividends are not considered to be rebates C. Rebates are allowed if it's in the best interest of the client D. Rebating are only allowed if specifically stated in the policy

A

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

C

How long must an insurer keep books and records of insurance transactions in the Premium Fund Trust Account? A. 3 years B. 5 years C. 7 years D. Indefinitely

B

How often is a resident insurance producer required to pay license fees? A. Annually B. Every 2 years C. Every 4 years D. It's a one-time fee

C

If an agent changes address on January 1st, by what date must he or she inform the Director? A. January 8 B. January 16 C. January 31 D. February 1

D

Of the following persons which one would be required to hold a producer's license? A. An officer of an insurer who does not receive commissions B. A trainer at an insurance company who does not sell insurance C. Underwriter D. Person soliciting policies of insurance

D

Producer's are allowed, by law, to hold client premiums for no more than how many days? A. 15 days B. 30 days C. 45 days D. 90 days

C

Ron's application to become an insurance producer has been denied. What is the soonest possible time that he can apply again? A. 1 year B. 2 years C. 3 years D. Once the application is denied, all subsequent applications will also be denied

C

Temporary producer license can be issued to all of the following EXCEPT A. An applicant in the process of obtaining a producer license B. A court-appointed representative of a deceased licensed producer C. A spouse of disabled licensed producer before and after the sale of the business D. Designee of a licensed producer entering active military service

A - 10days prior

The director issued a written notice about hearing for a business entity. The hearing is scheduled for May 1st. The affected business entity should receive the notice to later than A. April 20th B. April 1st C. 3 business days before the hearing D. 2 weeks in advance

A

The requirement that producers must account for all insurance funds collected, and without the expressed consent of the insurance company are not permitted to commingle those funds with their own funds, is known as A. Fiduciary responsibility B. Premium accountability C. Fiscal responsibility D. Accepted accounting principle

C

What is the maximum fire for a violation of a cease and desist order? A. $100 B. $500 C. $1000 D. $5000

B

When twin brothers applied for life insurance from Company A, the company found that while neither of them smoked and both had a very similar lifestyle, one of the twins was in a much stronger financial position than the other. Because of this, the company charged him a higher rate for his insurance. This practice is considered A. Adverse selection B. Discrimination C. Twisting D. Controlled business

A

If a license charges any fee separate from a commission off of the insured's premium, and if the fee exceed 10% of the premium's value, what must the licensed obtain? A. Insured's signature B. Director's permission C. Special tax form D. Premium Fund Trust form

B

If a licensed producer died, the Director may issue a temporary licensed to that producer's representative for an initial period of A. 60 days B. 180 days C. 9 months D. 1 year

C

If an insured requests forms that are necessary to present a claim, within how many working days must the insurer provide the forms? A. 5 B. 10 C. 15 D. 20

A

The Director may refuse to issue a license if a licensee's aggregate amount of premiums on controlled business exceeded the aggregate amount of premiums on all other insurance business during A. 2 calendar years immediately preceding the extension date of the license B. The 6 months period immediately following the issuance of extension of the license C. Any 1 year D. The licensing period

C

All policy application must identify which of the following entities? A. MIB B. Director C. Licensed which solicited the applicant's business D. Conditions of Acceptance

A

Fiduciary responsibilities apply in which of the following situations? A. Handing client premiums B. Selling insurance C. Soliciting insurance D. Binding coverage

A

If a person applies to become a life insurance producer, what is the minimum number of hours of prelicensing education that must be completed in a classroom? A. 7.5 B. 10 C. 12.5 D. 20

A

If a person is working toward becoming permanently licensed as a producer and is issued a temporary license, what else must the person also do? A. Take a training course B. File weekly reports to the Director C. Pay a fee for each 30-day period of the license D. Shadow a licensed producer

D

If an actuary would like to sell life insurance policies, what licensure is needed? A. General producer's license B. Broker's license C. Insurer's license D. Producer's license for life insurance

A

In what capacity does an insurance producer act in the conduct of the business when handling premium funds? A. Fiduciary B. Accounting C. Financial D. Special

C

Producer's who broker insurance must file a bond along with the application for license. The bond must be issued in favor of the people of Illinois, and must be on a continuous form and for an amount equal 5% of the premium brokered the previous year, NOT to exceed A. $10,000 B. $25,000 C. $50,000 D. $100,000

D

The Director notifies a producer of license termination on March 1. On April 15, the Director receives a request to review the changes in a court of law. What is the latest possible court date that can be set for the hearing? A. April 25 B. May 15 C. October 15 D. The court date will not be established

B

What is the minimum age for applying for a limited lines producer license? A. 16 years old B. 18 years old C. 21 years old D. 25 years old

C

Rebating is an unfair trade practice and is regulated by law. All of the following would be considered to be rebating EXCEPT A. An agent offers to share his commission with a policyholder B. An agent offers tickets to a baseball game as an inducement to buy insurance C. An agent misrepresents policy benefits to convince a policy owner to replace policies D. An agent offers the use of his lake house to person as an inducement to buy

A

Which of the following would be required to be licensed as an insurance producer? A. A salaries employee who advertises and solicits insurance B. A person whose activities are limited to producing insurance advertisements C. A salaried full-time employee who furnished information for group insurance D. An insurance company director who performs executive, administrative and managerial duties

A

Which of the following best describes the unfair trade practice of defamation? A. Making derogatory oral statements about another insurer's financial condition B. Assuming the name and identify of another person C. Issuing false advertising material D. Refusing to deal with other insurers

D

Which of the following criminal activities would warrant rejection, revocation, or suspension of an insurance producer's license? A. Speeding in an automobile B. Trespassing through a neighbor's yard C. Public drunkenness D. Forgery

B

Which of the following is NOT considered a misrepresentation as it pertains to unfair trade practices? A. Stating that the competitors will arbitrarily increase their premiums each year B. Making comparisons between different policies C. Starting that the insurance policy is a share of stock D. Exaggeration the benefits provided in the policy

B - it cannot be used

Which of the following is NOT true regarding a Premium Fund Trust Account? A. It is established to maintain all the premiums B. It could be used as a claim payment account C. It is a fiduciary Account D. It may be a depository for service fees and late changes

B

All of the following are true about the bond requirements in the state of Illinois EXCEPT A. The amount of the bond must be $2,500 or 5% of the premiums collected in the previous year B. Insurance producers with insurance companies that take responsibility for their actions are still required to post a bond C. Maintaining a bond or appointing insurance company is a requirement to holding a producer's license D. The maximum the bond would have to be is $50,000

A

Which of the following situations would describe a proper handling of premiums by a producer in this state? A. A producer who holds premium for 15 days establishes a Premium Fund Trust Account B. A producer is using the premiums account as a general operations account C. Fiduciary account balance is less than the amount deposited due to the number of claims D. A temporary producer is not under the obligation to hold the premiums in a fiduciary capacity

A

A person is in the process of becoming permanently licensed as a producer. A temporary producer's license may be issued for a maximum period of A. 90 days B. 100 days C. 120 days D. 180 days

C

Which of the following is NOT a duty of the Director of Insurance? A. Enforcing the insurance code B. Issuing Certificates of Authority C. Setting premium rates D. Examining authorized insurers

B

Which of the following would be considered an unfair claims settlement practice? A. The settlement of the claim is delayed for 30 days in order for the insured to conduct an investigation B. A claims adjuster advises the insured that if the claim goes to arbitration, the insured would probably receive less than what is currently being offered C. Requesting the insured to submit a signed, proof of loss statement, after the insured has already verbally advised the insurer of the claim D. Requesting the insured swear under oath concerning the facts of the claim

A

A nonresident producer in Illinois just relocated to Indiana and became a resident producer in that state. What must the producer do to satisfy one of illinois' requirements for nonresident producers? A. File a change of address within 30 days B. Pay a fee to the Illinois Department of Insurance C. Resubmit a nonresident license application D. Nothing

A

All of the following could be considered rebates if offered to an insured in the sale of insurance EXCEPT A. Dividends from a mutual insurer B. An offer of employment C. Stocks, securities, or bonds D. An offer to share in commissions generated by the sale

A

If a nonresident if applying for a license in Illinois and his home state does not require continuing education for Illinois residents A. The continuing education requirement will be waived in Illinois B. The applicant must complete the required education in Illinois before being issued a license C. The applicant can take a federal exam that will serve the continuing education requirement in Illinois D. If the applicant has been licensed for over 10 years in his home state, the continuing education requirement is waived

D

The director regulates insurance rates through detailed rate reviews. The Director will prohibit insurance rates that are A. Excessive B. Inadequate C. Unfairly discriminatory D. Any of the above

A

The necessary qualification for obtaining a producer's license in Illinois include all of the following EXCEPT A. Be at least 21 years of age B. Be considered competent and trustworthy C. Have completed an approved prelicensing course D. Have a good business reputation

D

What are the general duties of the Director of Insurance? A. Make rules to implement the insurance code B. Conduct investigations C. Enforce Illinois insurance laws D. All of the above

C

What is the minimum number of student hours required of a candidate for a casualty producer's license? A. 10 B. 15 C. 20 D. 40

D

What is the resident producer license fee payable once every 2 years? A. $50 B. $250 C. $100 D. $180

C

With which entity must a corporation register before it will be allowed to operate as an insurance agency? A. Federal Board of insurance B. MIB C. Director D. National Federation of Insurers

B

Illinois law requires that a licensed insurance producer notify the Director, in writing, of any change in their residential address within m A. 10 days B. 30 days C. 60 days D. 90 days

C

Which of the following is correct regarding the Director's ability to revoke or suspend a producer's license? A. The producer may lose their license without hearing B. The producer may not lose their license for conviction of any felony C. The producer must be given the reason, in writing for the nonrenewal, suspension, or denial of a license, and has the right to request a hearing within 30 days D. The producer will not lose a license for failure to repay student loans owed to the Illinois Student Assistance Commission

C

Which of the following terms describes making false statements about the financial condition of any insurer that are intended to injure any person engaged in the business of insurance? A. Twisting B. Slandering C. Defamation D. Undercutting

D

All of the following are true about license denial, suspension, or revocation EXCEPT A. A suspended, denial, or revoked license must be surrendered to the Director B. An agent may lose his or her license for forgiving another signature C. Failing to pay child support or state income taxes is grounds for loss of license D. An agent may still sell insurance on a suspended license for 180 days

D

All of the following are true regarding reinstatement of a lapsed producer license EXCEPT A. A producer's license may be reinstated within 12 months without having to pass a written exam B. To reinstate a lapsed license a penalty of double the unpaid renewal fee shall be required C. A licensed insurance producer who is unable to comply with license renewal producers due to military service may request a waiver of those procedures D. A producer's license may be reinstated within 24 months without having to pass written exam

A

An applicant receives a temporary insurance producer license. After 80 days, the owner of the insurance company decides to sell the business. Which of the following is TRUE? A. The license will automatically terminate B. The license can be applied elsewhere C. The license may be converted to a permanent producer license D. The Director will assess the case and make the ultimate decision

C

Which of the following entities determines who can receive a Limited Lines Producer License? A. Director B. State insurance board C. The company that the person represents D. Federally-based written examination

B

A producer receives notice that his license has been terminated. If the producer wants to have the changes reviews in court, within what time period must the request be made? A. 15 days B. 30 days C. 45 days D. 60 days

A

What type of license does an individual need to obtain in order to solicit and sell insurance? A. Producer's license B. Business entity license C. Broker's license D. Insurer's license

A

When a producer was reviewing a potential customer's coverage written by another company, the producer made several remarks that were maliciously critical of that other insurer. The producer could be found guilty if A. Defamation B. Misrepresentation C. Discrimination D. Nothing, unless the remarks were writing j

C

An individual whose license is denied or revoked will be ineligible to apply for license for a period of A. 1 year B. 2 years C. 3 years D. 5 years

B

An insurance company that routinely ignores all letters and phone calls from insureds that have filed claims is A. Avoiding a lot of little nuisance claims B. Guilty of an unfair claim settlement practice C. Avoiding a lot of paperwork hassles D. Saving money and improving the bottom line

C

Before each license renewal, an insurance producer must complete at least how many course study hours? A. 14 B. 20 C. 24 D. 30

B

In order for a firm to maintain its registration as a legal insurance company, what must it do? A. Pass a semi-annual inspection for the first 2 years B. Submit a biennial fee to the Director C. Nothing. Once a firm is registered with the Director, there is nothing that an insurer must do in order to maintain the registration D. Submit registration application annually

D

In the event a licensed producer dies, a temporary license will be issued to the deceased producer's representative. This temporary license will allow the license to perform all of the following acts EXCEPT A. Renew policies B. Collect premiums due C. Service existing policies D. Solicit insurance

C

Which of the following is an example of a producer being involved in an unfair trade practice of rebating? A. Charging a client a higher premium for the same policy as another client in the same insuring class B. Making deceptive statements about a competitor C. Telling a client that his first premium will be waived if he purchased the insurance policy today D. Inducing the insured to drop a policy in favor of another one when it's not in the insured's best interest

D

Which of the following is an example of an unfair claims settlement practice? A. Denying coverage after a reasonable investigation has been conducted B. Making claims payments which clearly indicate under which coverage payment has been made C. Using arbitration when the insured and insurer cannot reach agreement D. Failure to promptly settle a claim when liability has been clearly established

D

Which of the following persons is required to hold a producer license? A. A person who creates insurance advertisement B. A person who takes messages related to claim C. A person who administers employer benefits D. A person who negotiates insurance contracts

D

Who must inform the Director is a producer's felony conviction? A. MIB B. State police C. FBI D. The producer

B

Within how many days may a person who is being examined by the Director for non financial business practices request a hearing after receiving the examination report? A. 3 days B. 10 days C. 15 days D. 30 days