Teleperformance Pre Test Questions

A producer may not be compensated for controlled business unless aggregate premiums from other insurance for the past____months exceed premiums from controlled business. A) 12. B) 24. C) 36. D) 18.

A) 12.

Which of the following best describes a direct loss? A) Water damage resulting from a burst pipe. B) Loss of rents from a dwelling following a fire loss. C) Increased living expenses following a fire loss. D) Transportation expenses after a personal auto loss.

A) Water damage resulting from a burst pipe.

Controlled business means insurance issued on all of the following, except: A) One's own property. B) A neighbor's property. C) The property of relatives by blood. D) The property of relatives by marriage.

B) A neighbor's property.

Which one of the following is permitted? A) Assuring the payment of future dividends or refunds of unused premiums. B) Entering into an agreement with the purpose of committing an act of boycott, coercion, or intimidation, which would result in restraint or monopoly in the insurance business or contract replacement. C) Offering any rebate or discount not specified in the policy. D) Giving a promotional gift if the recipient is not required to perform any part of an application process.

B) Entering into an agreement with the purpose of committing an act of boycott, coercion, or intimidation, which would result in restraint or monopoly in the insurance business or contract replacement.

Rates are referred to as which of the following when the insurance company files for approval and then implements the rates? A) Prior Approval. B) File and Use. C) Mandatory. D) Open Competition.

B) File and Use.

In an action against the insurer on a contract entered into in violation of state insurance laws, the _____ is bound by the terms of the contract. A) Agency. B) Insured. C) Insurer. D) Producer.

B) Insured.

A producer's unwritten authority that is assumed by the public to exist is known as: A) Admitted. B) Assumed. C) Implied. D) Express.

C) Implied.

An individual faces the risk of economic loss in the event of property damage because of which of the following? A) Indemnity. B) Limit of recovery. C) Subrogation. D) Insurable interest.

D) Insurable interest.

A producer of consultant must biennially complete at least ____ hours of continuing education to renew a license. A) 24. B) 40. C) 30. D) 36.

A) 24.

Each insurer must notify the Commissioner within ____ days after terminating the appointment of any agent or organization. A) 30. B) 15. C) 10. D) 20.

A) 30.

To become a consultant, a person must have had a training period of at least 3 of the past ____ years. A) 4. B) 6. C) 5. D) 7.

A) 4.

The Commissioner must examine every insurer and rate organization at least once every ___ years. A) 5. B) 7. C) 6. D) 10.

A) 5.

What is the term for the idea that some risks are less desirable than average risks, and that these risks tend to seek coverage to a greater extent than more favorable risks? A) Adverse selection. B) Sharing. C) Law of Large Numbers. D) Estoppel.

A) Adverse selection.

What type of insurance is provided by the Terrorism Insurance Program established by TRIA? A) Commercial property and casualty. B) Life health. C) Personal lines. D) Life only.

A) Commercial property and casualty.

A person must satisfy _______ requirements by the license expiration date to renew a license. A) Continuing education. B) Production. C) Professional designation. D) Commission income.

A) Continuing education.

Which of the following is attached to a property and casualty insurance policy to amend policy provisions or conditions? A) Endorsement. B) Consideration. C) Warranty. D) Exclusion.

A) Endorsement.

It is a(n) _____ to knowingly and intentionally transact insurance other than through a qualified insurer. A) Felony. B) Administrative violation. C) Unfair trade practice. D) Misdemeanor.

A) Felony.

To receive a nonresident producer license, a nonresident must do all of the following, except: A) Pass the nonresident licensing exam. B) Agree to obey state laws. C) Be licensed and in good standing as a resident producer in his/her home state. D) Submit an application and fees.

A) Pass the nonresident licensing exam.

An insurance policy entered into in violation of state insurance laws is voidable by the ______ who entered into the transaction without knowing it was illegal. A) Policyholder. B) Agency. C) Insurer. D) Producer.

A) Policyholder.

To act as an insurance producer in Utah, a person or entity must obtain a(n)______ license. A) Producer. B) Adjuster. C) Consultant. D) Nonresident.

A) Producer.

Which of the following statements is not correct regarding rates and premiums? A) Rates may only be excessive if the insurer is making up for the lost reserves. B) Rates are considered inadequate when they do not cover projected losses and expenses. C) The rate is the amount charged for a particular unit of insurance. D) A premium is the total cost for the amount of insurance purchased.

A) Rates may only be excessive if the insurer is making up for the lost reserves.

An insurance contract entered into in violation of state insurance laws is unenforceable by, but enforceable against, the: A) Producer. B) Insurer. C) Agency. D) Insured.

B) Insurer.

All of the following are true of subrogation, except: A) It prevents the insured from collection twice for the same loss. B) It allows the insurer to file suit against the insured. C) It allows the insurer to attempt collection from a third party to reimburse a loss. D) It helps the insurer control expenses and premiums.

B) It allows the insurer to file suit against the insured.

All of the following acts are considered unfair claim settlement practices in Utah, except: A) Compelling insureds to sue by offering less than the amounts due. B) Responding to a claim or communication about a claim within 15 days of receipt. C) Having a policy or practice of appealing arbitration awards. D) Not trying, in good faith, to settle a claim for which liability has become reasonably clear.

B) Responding to a claim or communication about a claim within 15 days of receipt.

Who is responsible for organizing, administering, and carrying out the general duties and broad powers of the Utah Insurance Department? A) The State Attorney General. B) The Commissioner. C) The Governor. D) The State Treasurer.

B) The Commissioner.

At least what percentage of the continuing education requirements for a producer or consultant must be classroom instruction? A) 30. B) 25. C) 50. D) 40.

C) 50.

Possibility of loss is called: A) A peril. B) An insurable interest. C) A risk. D) A hazard.

C) A risk.

Insured risk classification may be based upon which one of the following criteria? A) Creed or national origin. B) Race or color. C) Age or health. D) Religion.

C) Age or health.

Which of the following regarding insurance fraud regulation is false? A) The Commissioner may suspend or revoke a person's license for committing insurance fraud. B) Suspected insurance fraud must be reported in writing to the Commissioner. C) An insurer is absolutely liable for any and all their employee's fraud. D) It is fraudulent to fail to forward a premium to an insurer.

C) An insurer is absolutely liable for any and all their employee's fraud.

All of the following are reasons why the Commission may disapprove, or withdraw approval of, any form, except: A) It fails to provide the insurers name and domicile. B) It violates state law. C) It fails to provide the producer's name, address, or business address, if for a basic policy or application. D) It is unfair, encourages misinterpretation, is not in the public interest, or contains provisions that endanger the insurer financially.

C) It fails to provide the producer's name, address, or business address, if for a basic policy or application.

When writing an application for car insurance, Producer M asked her client, B, if he had been convicted of driving while intoxicated (DWI) in the past 10 years. B answered 'no,' although he had been convicted of a DWI last year, B is guilty of which of the following? A) Unilateral statement. B) Waiver. C) Misrepresentation. D) Representation.

C) Misrepresentation.

An insurer or a producer may pay commissions to an insurance agency or to persons who do not sell insurance in Utah if the payment is: A) For variable contracts. B) For a new sale to a formerly licensed person. C) Not a prohibited inducement or rebate. D) Not more than $500.

C) Not a prohibited inducement or rebate.

All of the following are types of insurers, except: A) Mutual insurers. B) Reciprocal insurers. C) Proprietary insurers. D) Stock insurers.

C) Proprietary insurers.

To recommend an insurer who compensates a producer or consultant, the producer or consultant must in writing do all of the following, except: A) Disclose the relationship. B) Include the disclosure with any service report. C) Provide the consumer with the NAIC's consumer guide on conflicts of interest. D) Agree on a fee before rendering services.

C) Provide the consumer with the NAIC's consumer guide on conflicts of interest.

A fire sprinkler system installed in a factory is considered which of the following methods of managing risk? A) Retention. B) Avoidance. C) Reduction. D) Transfer.

C) Reduction.

When an insurance policy is not clear, the court will usually interpret in favor of the insured because of which characteristic? A) The policy is a bilateral contract. B) The policy is an aleatory contract. C) The policy is a contract of adhesion. D) The policy is a conditional contract.

C) The policy is a contract of adhesion.

An insurance contract is valid even if purchased from a(n)_______ person. A) Non-degreed licensed. B) Nonresident licensed. C) Unlicensed. D) Resident licensed.

C) Unlicensed.

Which one of the following is considered to be an unfair claim settlement practice in Utah? A) Trying, in good faith, to settle a claim for which liability has become reasonably clear. B) Paying a claim without investigation. C) Paying a claim for covered medical treatment after pre authorization has been given. D) Compensating agents based on the insurer's savings that result from denying a claim.

D) Compensating agents based on the insurer's savings that result from denying a claim.

Estoppel is defined as which of the following? A) Estoppel is the failure to disclose known facts. B) Estoppel is the intentional misrepresentation of a material fact. C) Estoppel is the intentional abandonment of a known right. D) Estoppel prevents a party from denying a fact, if the fact was admitted to be true by a previous action.

D) Estoppel prevents a party from denying a fact, if the fact was admitted to be true by a previous action.

Which property condition requires the insurer broaden coverage during the policy period without an increase in premium? A) Assignment. B) Other insurance. C) Appraisal. D) Liberalization.

D) Liberalization.

A commission for selling insurance may not be paid to a person other than a licensed insurance: A) Broker. B) Consultant. C) Advisor. D) Producer.

D) Producer.

Minimizing the chance of a loss is considered which of the following ways of managing risk? A) Avoidance. B) Sharing. C) Retention. D) Reduction.

D) Reduction.

A lapsed license may not be used to transact insurance business, unless: A) The consumer does not object. B) The insurer grants permission. C) The business is conducted out of state. D) Reinstated.

D) Reinstated.

In property insurance, the principle that gives the insurer the right to take possession of damaged property after paying the loss is known as: A) Vacancy. B) Indemnity. C) Abandonment. D) Right of Salvage.

D) Right of Salvage.

Taxable corporate dividends are received by which type of insurer's shareholders? A) Mutual. B) Reciprocal. C) Risk Retention Group. D) Stock.

D) Stock.

Risk is defined as: A) Amount of loss. B) Specific cause of loss. C) Insurable interest in property. D) Uncertainty or chance of loss.

D) Uncertainty or chance of loss.

Charging different rates to persons of the same class and life expectancy (life insurance), or of the same class and hazard (health insurance), unless the difference is based on sound actuarial principles, is called: A) Illegal inducement. B) Intimidation. C) Rebating. D) Unfair discrimination.

D) Unfair discrimination.