Chapter 10 quiz

What is the purpose of the life insurance guaranty association?

Help protect policyowners and beneficiaries against financial loss caused by the insolvency of an insurance company.

An agent receives an emergency cease and decist order for chronically misrepresenting his insurance honest policies. The agent knows that he did not commit the violations stated in the emergency cease and desist order. He wants to contest the charges in a court hearing. Which of the following is true?

The hearing must be held within 10 days of receiving a request, unless both parties agree to a later date

If an agent has completed 35 hours of continuing education and one renewal period, how many CE hours will the agent have to complete in the next renewal period?

24

Who might receive dividends from a mutual insurer?

Policyholders

Which of the following is an example of a producer being involved in an unfair trade practice of rebating?

Telling a client that his first premium will be waived if he purchases the insurance policy today

An agent discovers his newest client was the result of a referral. To show his thanks to the referring customer, the agent could

Thank the customer

Who do agent represent?

The insurance company

A temporary license holder can receive a commission from my cell made to all of the following except

The license holders sister in law

After filing a claim, and insured tells the ensure that there is more than one insurance policy in force. That ensure sets aside the claim and to let here's what the other company will pay. The insurers action will be classified as

Unfair

Which of the following occupations would not directly help to qualify someone for the office of commissioner of insurance?

Insurance agent

And insured purchased an insurance policy five years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insure. From what type of insurer did the insured purchased the policy?

Mutual

What is the major difference between a stock company in a mutual company?

Ownership

For which of the following actions can an agent license be suspended or revoked?

Rebates of premiums

Any inducement offered to the insured in the sale of an insurance policy that is not specified in the policy is a unlawful practice known as

Rebating

An agent license in Texas is moving to Kansas. Which of the following applies?

The agent has 30 days to notify the department of insurance of the new address

To legally transact insurance in the state, and insurer must obtain which of the following

Certificate of authority

Which entity has the authority to grant a temporary life insurance agents license?

Commissioner of insurance only

Which of the following is not a possible penalty for a violation of the insurance code?

Define up to $100,000

The owner of a small restaurant submit a claim to his ensure after a loss due to fire. The insurer investigation find a police report that shows that a fire may have been of suspicious origin. The insured can do which of the following?

Delay an acceptance or rejection decision

On a participating insurance policy issued by a mutual insurance company, dividends paid to the policy holders are

Not taxable since the IRS treats them as a return of a portion of the premium paid

All of the following would be considered an insurance transaction except

Obtaining an insurance license

The commissioner of insurance issues a cease and desist order and immediately received a request for the charges to be reviewed in a hearing. Within what number of days must the hearing be held?

10

An agent's license will terminate within how many days from the due date of obligatory fees and continuing education requirements?

90

On a participating insurance policy issued by mutual insurance company, dividends paid to the policy holders are

Not taxable since the IRS treat same as a return of a portion of the premium

When twin brothers applied for life insurance from company A, the company found that while neither of them smoked and both had a very similar lifestyle, one of the twins was in a much stronger financial position than the other. Because of this, the company charged him a higher rate for his insurance. This practice is considered

Discrimination

The commissioner has full power and authority to do all of the following except

Draft insurance laws

An insurance company is domiciled in Montana and transact insurance in Wyoming. Which term best describes the insurers classification in Wyoming?

Foreign

And which of the following situations is it legal to limit coverage based on marital status?

It is never legal to limit coverage based on marital status

An insurer advertise has a health policy that is covered by the life and health insurance guaranty association. The advertisement includes a short list of benefits an approximate rate. The end of the advertisement includes statement that protection is provided by the guaranty association. Which of the following is true?

Mentioning they guarantee association in advertisements is considered to be unfair trade practices