Insurance Regualtion

The Federal Fair Credit Reporting Act

Regulates consumer reports

In the transaction of insurance, ___ is considered to be representing the client.

The broker

Which of the following insurance providers must be nonprofit and sell insurance only to its members?

Fraternal

Anyone who willfully violates a cease and desist order can be fined up to

$100 per day

Fine levied by the director in lieu of license revocation or suspension must be paid within

30 days

A contract in which an insured cannot negotiate with the insurer and the only option is to accept or reject the policy is called.....

A contract of adhesion

__ is owned by a corporation to serve that organization's needs at lower rates than would otherwise be available with commercial insurance?

Captive insurer

An insurance company that doesn't issue insurance policies but provides a meeting place for underwriters to conduct business is known as a

Lloyd's Association

What is the term which best describes when a person develops a formal program identifying, evaluating, and funding its losses?

Self-insuring

When an individual purchases insurance, what risk management technique is he or she practicing?

Transfer

an individual's tendency to be dishonest would be indicative of a

moral hazard

In an __ contract, unequal amounts are exchanged between payments and benefits.

Aleatory

Which authority is NOT stated in an agent's contract but is required for the agent to conduct business?

Implied

In order to transact insurance business in this state, an agency must meet all of the following requirements except

obtaining an insurance AGENCY license

What is the maximum penalty for habitual willful noncompliance with the Fair Crediting Reporting Act?

$2,500

An insurance company sells an insurance policy over the phone in response to a TV ad. What is this act called?

Direct response marketing

Events or conditions that increase the chances of an insured loss occurring are referred to as

hazards

A producer failed to complete the required continuing education credit hours for this compliance period. Within what time period after the deadline may the license be reinstated? (and if a penalty fee has been paid)

6 months

What is foreign insurer?

An insurer with a home office in another state ( Guam, PR)

__ describes making false statements about the financial condition of any insurer that are intended to injure any person engaged in the business of insurance?

Defamation

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?

Fair Credit Reporting Act

The reduction, decrease or disappearance of value of the person or property insured in a policy by a peril insured against is known as

Loss

All of the following are unfair claims settlement practices except

Suggesting negotiations in settling the claim

Who is responsible for covering the expenses associated with the examination of domestic insurers?

The examined insurer

The Director must conduct an examination of each insurer in this state at leat

every 5 years or as often ad deemed appropriate.

__ is not an insurer but an organization formed to provide insurance benefits for members of an affiliated lodge or religious organization?

Fraternal benefit society

All of the following are true of the Insurance Fraud Act except

Requires reports of insurance fraud to be available for public inspection.