Chapter 13

According to the California insurance code, what is the maximum penalty per violation for anyone who unwillfully commits an unfair method of competition?

$5,000

Which word implies permissiveness according to the California Insurance Code?

May

Which of the following does the California department of insurance (CDI) have no jurisdiction over?

Medicare

When intentional concealment is involved, what course of action is the injured party entitled to?

Rescission of the contract

Which of the following does not have to be included on life insurance policy illustrations?

Statement that all values and benefits are guaranteed

Any changes in background information that occur after a producer application has been submitted or a license has been issued MUST be reported to the Insurance Commissioner within

30 days

The free-look period for life insurance policyowners age 60 or older is

30 days

How long must life agents keep their transaction records?

5 years

What is an "insurance broker" according to California insurance code?

A person compensated for transacting insurance on behalf of another person with an insurer.

Life insurance surplus must be distributed to policyowners at what frequency?

Annually

Insurance agents must make their insurance records available to the commissioner

At all times

The California Insurance Code allows an individual how many days to cancel a life policy for a full-refund?

Between 10 and 30 days

According to the California insurance code, who is responsible submitting a life agents appointment?

Insurer

When handling premiums for an insured, an agent is acting in which capacity?

Fiduciary

Which of the following does the California insurance code not require an insurance policy to specify?

Insurer's financial rating

Which of the following is not protected under the California life and health guarantee association?

Insurers

What is an insurance solicitor authorized to do?

Help an agent or broker sell insurance

What prevents a life insurance policy from being rescinded by the insurer after being in force for two years?

Incontestability clause

Who does a life settlement broker represent?

Individual wanting to sell their life policy to a third party

Jim is applying to become an insurance agent and has a past misdemeanor conviction that was later expunged due to California Penal Code 1203.4. Which of the following statements is correct?

Jim must still disclose the conviction on his insurance license application

What type of license is required for an individual who charges a fee to review an insured's existing life insurance policy?

Life and disability analyst

According to section 1729.2 of the California insurance code, which of these does not qualify as "background information"?

Misdemeanor charges filed, not resulting in a conviction

Which of the following acts is not a federal offense committed by an insurance agent?

Misrepresentation on an insurance application

According to the California insurance code, how is the word "may" interpreted?

Permissive

What does the term "illustration" mean when used in the phrase "life insurance policy illustration", according to the California insurance code?

Presentation of policy features that includes non-guaranteed elements

Why is a life insurance policy's delivery date important?

The free-look period begins on the policy delivery date

Under the California Insurance Code, a licensee's license number must be printed at what size on all price quotes, business cards, and printed material?

The same size print as the licensee's phone number, fax number or address

An insurer that has been found using higher rates based on race, religion, or ethnicity is said to be engaging in

Unfair discrimination

The California insurance code defines "policy" as a(n)

Written contract

What is the insurance term the state of California uses for an insurer that is eligible to transact business in this state?

admitted

When an insurer has met the qualifications necessary to transact business in California, it is said to be

admitted

an insurance company entitled to transact business in California is called an

admitted carrier

Failure to report background changes within 30 days as required under section 1729.2 of the California insurance code could subject a license or applicant to

all of these

A person who asserts a right of recovery under an insurance policy is called

claimant

Before an insurer is allowed to test an individual for HIV, what must be completed?

consent form

In California, an insurer organized under the state laws of Oregon is called a(n)

foreign insurer

An individual who transacts life, disability, or life and accident and health insurance on behalf of an insurer is called a(n):

life agent

A representation may be altered or withdrawn

only before the insurance is in effect

Pete is a life agent who has misappropriated fiduciary funds to his own use. What is Pete guilty of?

theft

Paul has an existing annuity and is sold a new one, in which the new policy holds no greater financial benefit to him than the existing contract. This is considered a(n)

unnecessary replacement