Arizona Life Insurance Chapter 11: Laws and Rules
The maximum prison sentence given under federal law for unfair and deceptive insurance practices is
15 years
A life insurance policy in Arizona becomes incontestable after it has been in force for
2 years
An annuity becomes incontestable after it has been in force for
2 years
A licensee whose name or address changes must notify the Department of Insurance within
30 days
A terminated employee has how many days upon termination to convert group life insurance coverage to an individual policy?
31 days
An insurance company may delay the payment of the cash value of a surrendered whole life insurance policy for up to
6 months
Under the Telemarketing Sales Rule, telemarketing calls may NOT be received until
8:00 AM
Under the Telemarketing Sales Rule, telemarketing calls may ONLY be received between the hours of
9:00 AM and 10:00 PM
Under the Telemarketing Sales Rule, telemarketing calls may NOT be received after
9:00 PM
In Arizona, an attempt to defraud an insurance company is considered
A felony
The term "life settlement broker" may refer to
A licensed life settlement provider
All of the following are unfair claims settlement practices EXCEPT
An attempt to settle a claim by arbitration
The administration of a reciprocal insurer who manages the premiums collected from the group's members is called
An attorney in fact
The administrator of a reciprocal insurer who manages the premiums collected from the group's members is called
An attorney in fact
When a company is licensed by the Department of Insurance to do business in this state, it becomes
An authorized company
All of the following may obtain a temporary's producer's license EXCEPT
An employee of a licensed producer who is retired
Misrepresenting pertinent policy provisions relating to coverage after a loss is
An unfair claims settlement practice
The refusal of doing business with an individual or business is call a(n)
Boycott
An insurer that confines or largely limits the exposures it writes to those of its owners is called
Captive
Proceeds of a life settlement contract could be subject to the claims of
Creditors
Under which marketing system do insurers solicit customers by mass media advertising and mail without the services of an agent?
Direct response
Arizona law requires the Human Immunodeficiency Virus (HIV) consent form to
Disclose the types of individuals or organizations that may receive a copy of the test results
A producer's license may be suspended
For misappropriation of premiums
When determining the suitability of an annuity for a consumer, the insurance provider is obligated to
Make reasonable efforts to fit the annuity with the consumer's needs
Life settlement brokers are permitted to do all of the following EXCEPT
Make the first transaction up to 30 days before approved for a license
If a producer misleads or fails to adequately disclose the title and true nature of a policy offered to a potential insured, it may be considered
Misrepresentation
When advertising a life insurance policy, a producer is required to disclose the
Name of the actual insurer
A life insurance producer is required to give a disclosure notice about information practices to an applicant or proposed insured
Prior to or at the time of signing the application
The Director may suspend a producer's license when the producer
Rebates a portion of the commission to the insured
All of the following claims settlement practices could initiate a cease and desist order EXCEPT
Refusing to pay a claim without conducting a reasonable investigation of all available information where material facts are in dispute
Any of the following may be unfair claims settlement practices EXCEPT
Refusing to pay persons bringing false or fraudulent claims
A transaction in which a new life insurance policy is purchased and an existing life insurance policy is surrendered is called
Replacement
Regulations for variable insurance contracts are set by all of the following EXCEPT
Securities and Exchange Commision
Security laws passed by Congress are enforced by which Federal agency?
Security and Exchange Commission
Regulations for variable insurance contracts are set by all of the following EXCEPT
State attorney general's office
Under the Fair Credit Reporting Act
The consumer who was investigated must be advised that credit, insurance employment was denied because of an unfavorable report.
Under the Fair Credit Reporting Act, which statement is true?
The consumer who was investigated must be advised that credit, insurance or employment was denied because of an unfavorable report.
The Arizona Life and Disability Insurance Guaranty Fund protects an insured in the event of
The insurer's insolvency
Unless it is regarding fraud, which of the following statements about the contestability of a life Insurance policy is true?
The policy can usually only be contested by the insurer during the first two years of contract
When an individual purchases insurance as a result of threats made by the producer, there has been a violation of
Unfair trade practice laws
When replacing a life insurance policy, which of the following is advisable?
Wait until the new policy is issued and delivered before surrendering existing policy
If a basic illustration is not provided, an insurer MUST provide a policy summary to a prospective insured at which of the following times?
When the policy is delivered
When an insured under a group life insurance plan in Arizona elects the conversion option, the new policy is issued
Without requiring evidence of insurability
An insurer operating in the U.S. but headquartered outside the U.S. is
an alien insurer
Which provision makes the application part of the annuity contract?
Entire Contract clause
The period during which a buyer may return a fixed annuity contract for a full refund is called the
Free look period
A life insurance illustration showing future premiums being paid out of nonguaranteed values must disclose that
The policyowner may need to resume premium payments depending on actual results
A licensed producer who lives in another state and transacts insurance in Arizona is called
a nonresident producer
During the first two years a life insurance policy is in force, the insurer may contest a policy for all the following reasons EXCEPT
Misstatement of age in the application
Illustrations used in the sale of life insurance contain a statement that must be signed by
The producer
A whole life policy that provides a choice of dividend options must include the following statement about dividends
They are not guaranteed
A producer must maintain customer records for how many years following the completion date of the insurance transaction?
Three
A producer must report to the Director any administrative action taken against her by any governmental agency within
30 days
Which of these situations would NOT potentially involve a prison sentence under Federal law?
Transacting insurance with a nonresident license
According to the Federal Fraud and False Statements Act, which of these is considered to be an intentional violation?
Making false entries in a company's books
According to the federal fraud and false statements regulation, what is required for a prohibited person to transact insurance business in this state?
Written consent from the state insurance regulatory agency