Ch.18 Michigan Laws and Rules Pertinent to Insurance

15

A producer MUST be appointed by the insurer within how many days from the date the agency contract application is submitted? 10 15 20 25

Fraud

A producer who knowingly submits a FALSE statement in support of a claim may be found guilty of coercion twisting rebating fraud

Recording the receipt and distribution of premiums due to an insurer

A producer's fiduciary responsibility includes which of the following activities? Recording the receipt and distribution of premiums due to an insurer Properly remunerating persons who furnish leads on prospects Providing needed insurance to prospective insureds through any sources that are available Guaranteeing payment to insureds for losses covered by policies that the producer sold

Submit to the replacing insurer a list of all Life Insurance policies or annuity contracts proposed to be replaced

According to the Michigan Insurance Code, which of the following MUST a producer do when replacing a Life Insurance policy? Notify the beneficiaries of all the policies or annuity contracts proposed to be replaced Notify the insurer whose policy is being replaced, but not the insurer replacing the policy Submit to the replacing insurer a list of all Life Insurance policies or annuity contracts proposed to be replaced Forward the signed and completed Disclosure Statement to the replacing insurer and not provide the applicant with a copy

Stock company

Which form of insurer has shareholders? Reciprocal company Mutual company Stock company Fraternal Society

Pay premiums due to insurers on a timely basis

Which of the following actions MUST be taken by producers Return unearned premiums to clients at the close of the agency's fiscal year Deposit premiums in separate accounts for each insurer that they represent Pay premiums due to insurers on a timely basis Maintain premium funds in interest-bearing accounts

Giving the insured an article of merchandise printed with the producer's name costing $5

Which of the following is NOT an illegal inducement? Giving the insured tickets to a sporting event valued at $100 Giving the insured a return of premium in excess of $25 Giving the insured an article of merchandise printed with the producer's name costing $5 Giving the insured a free policy of insurance resulting from the sale of a related policy of insurance

A business entity soliciting insurance

Which of the following is REQUIRED to be licensed as an insurance producer? An underwriter of an insurer An administrator of a group plan A business entity soliciting insurance An officer or director of a licensed insurer

Home health care

Which of the following services MUST be provided by HMO plans? Eye care Dental care Well child care Home health care

Employer

Who has the option to renew a small employer health plan? State insurance commissioner Employer Employees Employee union

nonaffiliated third party

A licensee can disclose a consumer's policy account number to all of the following EXCEPT a member in an affinity program that was identified to the consumer upon entering the program service provider marketing on behalf of the licensee consumer reporting agency nonaffiliated third party

Misrepresentation

A licensee who informs an insured of inaccurate terms, benefits, or advantages of any policy is committing which of the following violations? Discrimination Misrepresentation Fraud Defamation

3

A licensee who is required to take continuing education MUST include how many ethics coursework hours? 1 2 3 6

have a legitimate non-insurance purpose

An association wanting to buy insurance under a group health plan MUST file with the Commissioner create their own insurance company have a legitimate non-insurance purpose be formed as a Limited Liability Company

17.5

An employee is REQUIRED to work AT LEAST how many hours in a normal week to be eligible for small employer group insurance? 17.5 17 15.5 15

an authorized agency makes a written request to the insurer during an insurance fraud investigation

Consumer privacy regulations permit the release of an insured's financial information when A distant relative requests financial information in writing The Department of Energy, Labor, and Economic Growth makes a written request to the insurer for employment purposes A creditor requests information in writing to approve a line of credit An authorized agency makes a written request to the insurer during an insurance fraud investigation

was a licensed producer at the time of the sale

Deferred commissions may be paid to a person who sold an insurance policy when the person was a licensed broker at the time of sale was a licensed producer at the time of the sale passed the examination and applied for a producer license at the time of the sale passed the examination and applied for a solicitor license at the time of the sale

To reduce the premium

For what purpose is a life insurance application backdated? To reduce the premium To reduce the face amount To protect health status To allow for additional underwriting

Trust

Group insurance premium payments made by an employer under the terms of a Taft-Hartley Trust are paid directly to the trust insurer union from dues collected from the members union under the terms of a collective bargaining agreement

require the producer to notify their clients

If a producer is found guilty of forging another's name to an application for insurance, the insurance commissioner may do all of the following EXCEPT place the producer on probation levy a civil fine on the producer suspend or revoke the producer's license require the producer to notify their clients

The application

In addition to the actual policy, an entire contract includes which of the following? Clauses Credit report Provisions The application

63

In determining whether a pre-existing condition applies, the enrollee CANNOT have more than how many days' gap in health insurance? 60 63 65 70

6 months

In order to save on premiums, a Life Insurance policy can legally be backdated up to 3 months 4 months 6 months 12 months

additional premiums

In the Michigan Insurance Code, Chapter 45, insurance fraud defines financial loss as all of the following EXCEPT loss of earnings additional premiums out-of-pocket expenses repair and replacement costs

defamation

Making a statement that is false or maliciously critical of the financial condition of an insurer is known as coercion defamation intimidation boycott

Misrepresentation

Providing incorrect, misleading, incomplete, or materially untrue information in the license application is forgery coercion embezzlement misrepresentation

Twisting

The act of using misrepresentation to induce an insured person to terminate an existing policy and purchase a new policy is referred to as twisting subrogation a life settlement coercion

twisting

The unfair trade practice of replacing an insurance policy from one insurer to another based on misrepresentation is called rebating twisting replacement false advertising

intimidation

The unfair trade practice of using threat or force to restrict fair trade in the transaction of insurance is called twisting defamation intimidation misrepresentation

must have an appointed guardian

To receive proceeds from a death benefit, a minor must be related to the insured can only be named as a contingent beneficiary must be at least 16 years old must have an appointed guardian

pain and suffering

Under Workers' Compensation, injured employees are covered for all of the following issues EXCEPT loss of wages pain and suffering medical expenses occupational illnesses

An inflation protection feature

Under long-term care insurance, which of the following MUST an insurer offer to each policyowner at the time of purchase? Lifetime minimum benefit levels Daily minimum benefit levels A decrease in annual benefit levels An inflation protection feature

Underwriting

What activity does NOT require an insurance producer's license? Underwriting Soliciting Negotiating Selling

Autopsy

When determining the exact cause of death from an accident, which of the following actions by the insurer takes precedence? Autopsy Medical notes Death certificate Investigative report

Benefits are limited to a specific maximum dollar amount per procedure

With a scheduled dental policy, how are covered expenses paid? A coinsurance is normally applied to benefits paid A deductible must be met by the insured before benefits are paid Benefits are limited to a specific maximum dollar amount per procedure Covered expenses are fully reimbursed to the insured