Health Exam

If a person does not comply with an order issued within 2 weeks after the Commissioner has given notice, for each day that the violation continues, the Commissioner may issue a fine of up to a)$5,000. b)$1,500. c)$2,000. d)$3,000.

a)$5,000. The Commissioner may obtain a temporary or permanent injunction or restraining order for any violations of insurance laws. If a person does not comply with an order issued within 2 weeks after the Commissioner has given notice, the Commissioner may issue a forfeiture of up to $5,000 for each day that the violation continues.

An insurer terminates an agent's appointment. Within how many days of termination must the intermediary be notified? a)15 b)20 c)30 d)10

a)15 When the appointment of an individual agent is terminated, the insurer must notify the intermediary in writing, prior to or within 15 days of filing the termination notice.

According to the Law of Agency, a principal is represented by a/an a)Agent. b)Insurer. c)Broker. d)Insured.

a)Agent. By definition, an agent is a person who acts for another person or entity known as the principal with regard to contractual arrangements with third parties.

If an insurance company wishes to order a consumer report on an applicant to assist in the underwriting process, and if a notice of insurance information practices has been provided, the report may contain all of the following information EXCEPT the applicant's a)Ancestry. b)Credit history. c)Habits. d)Prior insurance.

a)Ancestry The Fair Credit Reporting Act regulates what information may be collected and how the information may be used. Consumer Reports include written and/or oral information regarding a consumer's credit, character, reputation, and habits collected by a reporting agency from employment records, credit reports, and other public sources. Ancestry is not a relevant factor assessed in these reports.

Any person who violates an insurance statute or rule of Wisconsin can be imprisoned for up to how many years? a)2 b)3 c)4 d)5

b)3 Any person who violates an insurance statute or rule of Wisconsin can be fined up to $5,000 or imprisoned for up to 3 years or both. A corporation can be fined up to $10,000. These penalties apply unless a specific penalty is provided elsewhere in the statutes.

Rebating is an unfair trade practice and is regulated by law. All of the following would be considered to be rebating EXCEPT a)An agent offers tickets to a baseball game as an inducement to buy insurance. b)An agent misrepresents policy benefits to convince a policyowner to replace policies. c)An agent offers the use of his lake house to person as an inducement to buy. d)An agent offers to share his commission with a policyholder.

b)An agent misrepresents policy benefits to convince a policyowner to replace policies. Using misrepresentation to convince a person to cancel an existing policy and buy a new one is called "twisting."

Which of the following changes does NOT need to be reported to the Commissioner within 30 days? a)From nonresident to resident status b)Each commission paid to a licensee who has held a license for less than 1 year c)The principal officers of a corporation licensed as intermediaries d)Management powers in the business entity

b)Each commission paid to a licensee who has held a license for less than 1 year Commissions paid to a new licensee do not need to be reported to the Commissioner within 30 days, but major changes in a business or an intermediary's resident/nonresident information should be quickly communicated to the Commissioner.

The primary eligibility requirement for Medicaid benefits is based upon a)Number of dependents. b)Need. c)Whether the claimant is insurable on the private market. d)Age.

b)Need. Medicaid is a program operated by the state, with some federal funding, to provide medical care for those in need.

Which of the following is an example of a producer being involved in an unfair trade practice of rebating?a)Making deceptive statements about a competitor b)Telling a client that his first premium will be waived if he purchased the insurance policy today c)Inducing the insured to drop a policy in favor of another one when it's not in the insured's best interest d)Charging a client a higher premium for the same policy as another client in the same insuring class

b)Telling a client that his first premium will be waived if he purchased the insurance policy today Rebating is defined as offering any inducement in the sale of insurance products that is not specified in the policy, including money, reductions in commissions, promises, and personal services. Both the offer and acceptance of a rebate are illegal.

Which of the following protects consumers against the circulation of inaccurate or obsolete personal or financial information? a)Consumer Privacy Act b)The Fair Credit Reporting Act c)Unfair Trade Practices Law d)The Guaranty Association

b)The Fair Credit Reporting Act. The purpose of the Fair Credit Reporting Act is to protect consumers against the circulation of inaccurate or obsolete information and to ensure that consumer reporting agencies are fair and equitable in their treatment of consumers.

An insurance policy specifies that it will pay $600 for a specific loss. The policyowner suffers a loss of $535. How much will the policy pay? a)$300 b)$500 c)$535 d)$600

c)$535 Applying the principle of indemnity, the insurer will pay the actual cost of the loss, up to the limit stated in the policy. In this case, the insurer will pay $535.

Within how many days of the original hearing and final issuance of an order (regarding an order issued by the Commissioner) may an aggrieved person request a re-hearing? a)0 b)10 c)20 d)30

c)20 An aggrieved person may request a re-hearing within 20 days after the original hearing and a final order is issued. This petition does not suspend or delay the effective date of the order unless the petition is granted or the order is superseded, modified, or set aside.

An agent is presumed to have exceeded the occasional exchange of business if the agent places more than how many insurance risks per calendar year with all insurers? a)10 b)15 c)25 d)5

c)25 Unless proven otherwise, an agent is presumed to have exceeded the occasional exchange of business if he/she places more than 5 insurance risks per calendar year with a single insurer with which he/she is not listed as an agent, or exchanges more than 25 insurance risks per calendar year with all insurers.

An intermediary must notify the Commissioner of a change of residence address within how many days of the change? a)10 b)20 c)30 d)5

c)30 An intermediary must notify the Commissioner of a change of address, business or residence, within 30 days of the change.

In this state, insurers must pay a claim within how many days of receiving proof of loss? a)10 days b)15 days c)30 days d)90 days

c)30 days Unless otherwise provided by law, every insurer must promptly pay every insurance claim. A claim is considered overdue if not paid within 30 days after the insurer received full or partial written notice. If the insurer can provide reasonable proof that the claim is not their responsibility, payment is not required.

If a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply? a)10 days b)3 days c)5 days d)7 days

c)5 days Consumers must be advised that they have a right to request additional information concerning investigative consumer reports, and the insurer or reporting agency has 5 days to provide the consumer with the additional information.

A policy may be issued for a term longer than one year or for an indefinite term as long as there is a clause in the policy providing for cancellation by giving how much notice prior to the anniversary date? a)100 days b)30 days c)60 days d)90 days

c)60 days A policy may be issued for a term longer than one year or for an indefinite term as long as there is a clause in the policy providing for cancellation by giving a 60-day notice prior to the anniversary date.

Which of the following would be considered an illegal inducement to purchase insurance? a)Listing the insurance companies the agency represents in a letter b)Inviting prospective clients to the grand opening of the producer's new office c)Confirming future dividends in a life insurance proposal d)Mailing an agency brochure to a prospective client

c)Confirming future dividends in a life insurance proposal A participating life insurance policy may pay a portion of its net earnings to a policyholder, but dividends cannot be guaranteed.

An applicant is denied insurance because of information found on a consumer report. Which of the following requires that the insurance company supply the applicant with the name and address of the consumer reporting company? a)Conditional receipt b)Disclosure rule c)Fair Credit Reporting Act d)Consumer Privacy Act

c)Fair Credit Reporting Act The Fair Credit Reporting Act governs what information can be collected and how the information can be used.

Which authority is NOT stated in an agent's contract but is required for the agent to conduct business? a)Assumed b)Express c)Implied d)Apparent

c)Implied Implied authority is not written in the agent's contract but is required in order for the agent to conduct business. Implied authority exists because not every single detail of an agent's authority can be written in a contract.

The Federal Fair Credit Reporting Act a)Regulates telemarketing. b)Prevents money laundering. c)Regulates consumer reports. d)Protects customer privacy.

c)Regulates consumer reports. The Federal Fair Credit Reporting Act regulates consumer reports, also known as consumer investigative reports, or credit reports.

Regarding long-term care policies, which of the following would NOT be included in activities of daily living? a)Dressing b)Eating c)Sleeping d)Bathing

c)Sleeping Normally to be eligible for benefits from a long-term care policy, the insured must be unable to perform some of their activities of daily living (ADLs). ADLs include bathing, dressing, toileting, transferring (or mobility), continence, and eating.

In comparison to consumer reports, which of the following describes a unique characteristic of investigative consumer reports? a)They provide information about a customer's character and reputation. b)The customer has no knowledge of this action. c)The customer's associates, friends, and neighbors provide the report's data. d)They provide additional information from an outside source about a particular risk.

c)The customer's associates, friends, and neighbors provide the report's data. Both consumer reports and investigative consumer reports provide additional information from an outside source about a customer's character and reputation, and both types of reports are used under the Fair Credit Reporting Act. The main difference is that the information for investigative consumer reports is obtained through an investigation and interviews with associates, friends and neighbors of the consumer.