Basic Principles Cram Exam

Who elects the governing body of a mutual insurance company?

Policyholders

Which of these describe a participating life insurance policy?

Policyowners are entitled to receive dividends

The stated amount or percent of liquid assets that an insurer must have on hand that will satisfy future obligations to its policyholders is called?

Reserves

What year was the McCarran-Ferguson Act enacted?

1945

Which of the following requires insurers to disclose when an applicant's consumer or credit history is being investigated?

1970- Fair Credit Reporting Act

A nonprofit incorporated society that does not have capital stock and operates for the sole benefit of its members is known as?

A fraternal benefit society

An insurance applicant MUST be informed of an investigation regarding his/her reputation and character according to the?

Fair Credit Reporting Act

What is the name of the law that requires insurers to disclose information gathering practices and where the information was obtained?

Fair Credit Reporting Act

A group-owned insurance company that is formed to assume and spread the liability risks of its members is known as a?

Risk retention group

What type of reinsurance contract involves two companies automatically sharing their risk exposure?

Treaty

At what point must a life insurance applicant be informed of their rights that fall under the Fair Credit Reporting Act?

Upon completion of the application