Life and Health Quiz : Insurance Regulations/Laws/Rules/

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Fiduciary

The requirement that the agents must account for and promptly remit all insurance funds collected is known as what type of agent responsibility ?

Unfair Discrimination

Two individuals who are the same risk and age class are charged different rates for their insurance policies due to an insignificant factor. What is it called?

Complete continuing education hours and pay a renewal fee

What are agents/producers required to do in order to renew their license?

Insurance on the producer's own life or property, or the lives or property of the producers' family or business associates.

What is controlled business ?

To protect policyowners , insureds, and beneficiaries from financial losses caused by insolvent insurers

What is the purpose of insurance guaranty associations?

For continuation of business in case the licensed producer dies or becomes disabled

What is the reason can a temporary license be issued?

Rebating

An agent offers a client tickets to a sporting event in exchange for the purpose of an insurance policy. What is the agent guilty of?

No, advertising of the existence of the guaranty association for the purpose of solicitation and sale of insurance policies by insurers is an illegal business practice.

Can insurers advertise the existence of the guaranty association during solicitation and sale of insurance policies?

Defamation

If a producer makes maliciously critical statements about another insurer, what is this illegal practice called?

Authorized and admitted

If an insurer holds a Certificate of Authority, it is known as what type of insurer?

Authorized and admitted

If an insurer meets the states's financial requirements and is approved to transact business in the state, it is considered what type of insurer?

Cease and desist order

If the Commissioner/ Superintendent finds a license engaging in an unfair method of competition or unfair practice, what order will be issued?

Misrepresentation

On the advertisement, a company claims that it has funds in it's possession that are , in fact, not available for the payment of losses or claims. What is the company guilty of?

To an insurer authorized to transact business in this state

To whom may a certificate of authority be issued?

Misrepresentation

What illegal act does a producer commit when the producer represents a policy in a more favorable light than the policy really is?

Only the producers properly licensed for the type of insurance transaction

Who may share in the commission from the sale of a life insurance policy?

An authorized insurer within a state

Who must be a member of insurance guaranty associations?

The Department of Insurance (Commissioner/Director/Superintendent)

Who must be notified of a producer's change of address?

1. Insurance company officers, 2. Directors, or 3. Any other employees who do not transact insurance and who do not receive commissions for their services (usually, their responsibilities include administrative, executive, and clerical).

In general, who can be executed from producer licensing and examination requirements?

1. A cease and desist order, 2. A fine, 3.License suspension or revocation

What are the most common penalties for violations of insurance statues?

To prevent a producer or insurer from further violating laws for transacting insurance

What is the purpose of a cease and desist order?

Twisting

What type of document persuades an insured, to his or her detriment, to cancel, lapse, or switch policies from one to another?

Broker

What type of insurer represents the insured?

The agent

What type of licensee represents the insurance company?

Whenever deemed necessary , but at least once very few years (please check our state regulations for specific time requirement )

When can the Commissioner or Director examine insurers?

When the commissions from controlled business do not exceed the aggregate commissions on all the other business (specific limits may vary from state to state)

When is controlled business legal?

Producer's spouse or designee in the case the licensed producer dies or becomes disabled

Who can usually be granted a temporary license?

A person authorized to sell, solicit and negotiate insurance contracts

Who is an insurance agent

An agent who resides and is licensed in another state, but who is authorized to transact insurance in this state.

Who is considered a nonresident?

The insurer who is being examined

Who is responsible for the cost associated with the examination of insurers?


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