simulate Code and ethics
According to the California Law, if an insurer includes a fraudulent claim clause in the contract regarding the legal ramifications of false claim, the clause must be preceded by which of the following statement? a. "For your protection, California Law requires the following to appear on this form." b. The legal ramifications only apply to insurance professionals" c. "State law requires that insurance fraud be reported to county, state, and federal authorities for the maximum prosecution allowed by law d. WARNING! the following conditions are in accordance with California Law"
"For your protection, California Law requires the following to appear on this form."
How many pints of blood are covered by Medicare Supplement core benefits?
3
In addition to penalties, fines, and possible imprisonment for violating the provision relating to misrepresentation, the Commissioner may suspend the license of such person for a period up to
3 years
For senior agents, the requirement for continuing education for California Partnership for long-term care policies is
8 hours each reporting period.
Every insurer is required to provide all records requested by the Commissioner within
A period of 30 days following a written request.
What is a material misrepresentation?
A statement by the applicant that, upon discovery, would affect the underwriting decision of the insurance company
Which of the following best describes a misrepresentation? a. A failure to disclose known facts b. An intentional omission of material information on the part of the insured c.A statement that is not guaranteed to be true d. A statement intended to distract, mislead, or deceive a party to a contract
A statement intended to distract, mislead, or deceive a party to a contract
What is reinsurance?
An agreement between a ceding insurer and assuming insurer
A person who transacts insurance business , other than life insurance, for compensation from and on behalf of another person, but on behalf of or as a representative of an insurance company for which he has an appointment is called
An insurance broker
An unincorporated, nonprofit association representing all insurance companies in the State of California licensed to transact workers compensation insurance is known as
California Workers Comp Inspection Rating Bureau (WCIRB).
What certification must an insurer receive before it can transact insurance in California?
Certificate of Authority
Which distribution system must the potential client take the initiative and respond to an advertisement through a telephone or mail contract with the insurer?
Direct response system
All of the following could be considered rebates if offered to an insured in the sale of insurance EXCEPT a. Stocks, securities, or bonds b. An offer to share in commissions generated by the sale c. Dividends from a mutual insurer d. An offer of employment
Dividends from a mutual insurer
Factual statements about the insured or the risk in an insurance policy are considered
Express warranty
Which of the following is NOT a standard level of care? a. Intermediate nursing care b. Hospice care c. Home care and community-based care d. Custodial care
Hospice care
Which type of insurance includes the assumption of a contractual obligation to reimburse the insured against all or a portion of his fees, costs, and expenses related to or arising out of services performed by or under the supervision of an attorney who is an active member of the bar of any jurisdiction or jurisdictions of the United States?
Legal insurance
According to California Insurance Code, the term "shall" describes what kind of actions?
Mandatory
What method do insurers use to protect themselves against catastrophic losses?
Reinsurance
Which of the following insurers are owned by stockholders who have the usual rights of ownership, including the right of voting?
Stock
In 2010, a law firm purchased a buy-sell agreement policy on each of its partners. In 2015, one partner left to start a new practice; however, the firm continued to pay the premiums on the policy. In 2017, the former partner died. The partners of the firm filed a claim on the policy to collect the death benefit despite the fact that the deceased was NOT part of the firm of its leadership. the insurer
Will pay the death claim to the beneficiary for this policy as written since insurable interest existed at the time of application.
Fraudulent activities in health care are estimated in billions of dollars annually. This results in
Increase in health care costs for everyone.
Home Service insurance is a variation of which type of life policies?
Industrial Life insurance
All of the following information must be communicated in an insurance contract EXCEPT a. Information of the other party already knows b. Information that is material to the contract c. Information that is material even though it cannot be proven d. Information not requested by an agent and company, even if it's considered relevant
Information the other party already knows.
Which type of insurance includes the assumption of a contractual obligation to reimburse the insured against all or a portion of his fees, costs, and expenses related to or arising out of services performed by or under the supervision of an attorney who is an active member of the bar of any jurisdiction or jurisdictions of the US? a. Contract insurance b. Legal insurance c. Errors and Omission insurance d. Professional liability insurance
Legal insurance
A licensed insurance agent over hears a conversation that leads him to believe a person is committing fraud. If the agent makes a written report to a law enforcement agency and the person is investigated, but it turns out that it was an erroneous accusation, what charge will the agent face?
No charges; the Insurance code gives the agent legal immunity
All of the following statements are TRUE regarding the California Earthquake Authority (CEA) EXCEPT a. The CEA is authorized to transact insurance to sell residential earthquake and any other insurance coverage as necessary. b.The CEA's policies can be marketed by the participating insurers that write the underlying policy of residential property insurance. c.The CEA must be administered under the authority of the Commissioner. d. The CEA is authorized to transact basic residential earthquake insurance only.
The CEA is authorized to transact insurance to sell residential earthquake and any other insurance coverage as necessary.
Which of the following is not a factor in determining rates charged by the California State Compensation Insurance Fund for insurance issued by it? a. The manner in which work is conducted b. A reasonable regard for the accident experience and history of each such insured c. The extent to which the employees in a particular establishment have or have not persons dependent on them for support d. A reasonable regard for the insured's means and methods of caring for injured persons
The extent to which the employees in a particular establishment have or have not persons dependent on them for support
After an employee was laid off, he was informed of the right to convert the group coverage to an individual policy within 31 days. Twenty days into the conversion period, the employee suffered a heart attack and died before he could obtain individual coverage. What is the group policy insurer required to do?
The insurer must pay the death benefit under the former group coverage
An agent is a legal person who acts on behalf of
The principal
When an auto insurance policy is cancelled for nonpayment of premium, how many days' notice must the insurer provide to the policyowner?
10 days
What is the maximum amount of coverage that may be extended to the insured's dependents under a group life insurance policy?
100% of the insurance on the life of the insured employee
When doing business in this state, an insurance company that is formed under the laws of another state is known as which type of insurer?
Foreign
All of the following information must be communicated in an insurance contract EXCEPT a. Information that is material even though it cannot be proven. b. Information not requested by an agent and company, even if it's considered relevant. c. Information the other party already knows. d. Information that is material to the contract.
Information the other party already knows.
Any person who knowingly and willfully obtains information about an individual from an insurance company, agent or organization supporting insurance under false pretenses shall be a. Not more than $10,000, imprisonment not to exceed one year or both. b.Not more than $20,000, imprisonment not to exceed one year or both. c.Not more than $10,000, imprisonment not to exceed two years or both. d.Not more than $20,000, imprisonment not to exceed two years or both.
Not more than $10,000, imprisonment not to exceed one year or both.
The Standard Fire Policy is a named perils contract, which means
Only perils listed in the policy are covered.
Which of the following best describes the insurer's liability for losses arising from the military service? a. The insurer's liable for all losses b. The insurer's liability is always excluded c. The insurer's liability is always reduced d. The insurer's liability may be reduced or excluded
The insurer's liability may be reduced or excluded
Which of the following best describes the term "24-hour coverage" in relation to workers compensation insurance?
This is a special type of workers compensation insurance used for people who may be on the job 24 hours a day, such as military personnel.
Which type of insurance guarantees or indemnifies owners of real or personal property or the holders of liens or other interested parties against loss or damage suffered to said property?
Title insurance
What is the purpose of California's State Compensation Insurance Fund (SCIF)?
To make workers compensation insurance available, especially to smaller companies with more limited payrolls
The authority to transact disability insurance given by an insurer to a person acting as an agent by appointment shall be effective
As of the date the notice of appointment is signed by the insurer.