Insurance Regulation
Within how many days of requesting an investigative consumer report must an insurer notify the consumer in writing that the report will be obtained? A-3 days B-5 days C-10 days D-14 days
A-3 days
Which of the following protects consumers against the circulation of inaccurate or obsolete personal or financial information? A-The Guaranty Association B-Consumer Privacy Act C-The Fair Credit Reporting Act D-Unfair Trade Practices Law
C-The Fair Credit Reporting Act
Which of the following reports will provide the underwriter with the information about an insurance applicant's credit? A-Any federal report B-Consumer report C-Inspection report D-Agent's report
B-Consumer report
The Superintendent may refuse to issue a license in all of the following situations EXCEPT if the proposed licensee A-Is not competent. B-Is from another state. C-Has not completed the prelicensing education. D-Is not trustworthy.
B-Is from another state.
The Superintendent will not renew an agent or broker's license upon finding that the license has been used to write controlled business. Which of the following would be a violation of controlled business practices? A-40% of the agent's commission in the last month comes from business sold to friends and family members. B-15% of the agent's annual commission is from business sold to the agent's family. C-25% of the agent's commissions come from policies sold to one client. D-5% of the agent's annual commission is from policies sold to the agent's business associates.
B-15% of the agent's annual commission is from business sold to the agent's family.
An independent adjuster may include which of the following? A-Attorney at law B-A firm who acts on behalf of the insurer C-Officer, director or regular salaried employee of an insurer D-Adjustment bureau or association owned by the insurers
B-A firm who acts on behalf of the insurer
Who is included in the definition of an agent? A-Agents of title insurance companies. B-A producer who owns his own field office. C-A salaried employee of the insurer who does not solicit insurance or receive a commission D-An agent who devotes only 25% of his time to the solicitation of insurance contracts and does not receive commission
B-A producer who owns his own field office.
What is the maximum penalty for habitual willful noncompliance with the Fair Credit Reporting Act? A-$100 per violation B-Revocation of license C-$2,500 D-$1,000
C-$2,500
If a person has been found liable for a civil penalty in a hearing, that ruling can be entered as a judgment and enforced after A-45 days. B-60 days. C-90 days. D-120 days.
D-120 days.
Any licensed person whose activities affect interstate commerce and who knowingly makes false material statements related to the business of insurance may be imprisoned for up to A-3 years. B-5 years. C-10 years. D-12 years.
C-10 years.
The continuing education (CE) requirement in this state: NY A-Cannot be extended or waived under any circumstances. B-Applies to life, annuity, and accident and health licensees only. C-Consists of completing 15 hours of continuing education each biennium. D-Allows agents to carry over excess CE hours to the next licensing period as long as it's for the same license.
C-Consists of completing 15 hours of continuing education each biennium.
According to the Insurance Frauds Prevention Act, will the person who suspects a fraudulent transaction be penalized for reporting it to the Superintendent? A-Each person who reports to the Superintendent will receive a monetary reward. B-No; in no case may the person be penalized. C-Yes D-No, as long as the act is reported in good faith
D-No, as long as the act is reported in good faith
An agent in another state wants to become an agent in New York. The other state gives the same privileges to New York agents wanting to be licensed in that state as it does its own agents. New York, therefore, extends the privileges of its agents to the prospective agent of the other state. What is this called? A-Equality B-Fair exchange C-Equanimity D-Reciprocity
D-Reciprocity
The Superintendent can examine an authorized fraternal benefit society and property/casualty insurance company once every A-12 months. B-18 months. C-3 years. D-5 years.
C-3 years.
Which of the following would NOT be considered an improper claims practice? A-Denying a claim after proof of loss statements are completed and submitted by insureds. B-Failing to acknowledge and act promptly upon communications with respect to an insurance claim. C-Misrepresenting to insureds pertinent facts or policy provisions relating to coverages at issue. D-Failing to adopt and implement reasonable standards for prompt investigation and processing of insureds' claims.
A-Denying a claim after proof of loss statements are completed and submitted by insureds.
If compensation is authorized, it must be made in writing, including the amount of compensation and signed by the person to be charged. How long must a copy of this record be kept? A-At least 3 years B-At least 5 years C-At least 1 year D-At least 2 years
A-At least 3 years
An insurance company assures its new policyholders that their premium costs will not increase for a period of at least five years. However, due to increasing financial strain, they plan to raise premium costs for all insureds by 10% over the next two years. What term best describes this act? A-Fraud B-Defamation C-Unfair discrimination D-Errors and omissions
A-Fraud
Which of the following would NOT be a violation of state insurance regulations? A-Agent B charges his clients a consulting fee, in addition to the premium for placing a policy. B-Agent C uses her license to write only business other than controlled. C-Agent D collects premiums due on policies and deposits the funds in his own personal account. D-Agent A uses her license to write only insurance for herself and her immediate family.
B-Agent C uses her license to write only business other than controlled.
An agent has recently changed his email address. What must the agent do to comply with the regulation for change of address? A-Report the address change to the NAIC B-Inform the Department within 30 days C-Inform all his customers within 30 days D-Nothing, email addresses are not subject to regulations
B-Inform the Department within 30 days
For which of the following reasons can a temporary license be issued? A-To provide temporary help to a licensed producer B-To service the existing business C-To solicit new business D-To negotiate new insurance contracts
B-To service the existing business
How long does a licensee have to notify the Superintendent of a change of address? A-90 days B-Immediately C-30 days D-60 days
C-30 days
If a certificate of appointment is terminated, a statement must be filed with the Superintendent within A-15 days. B-20 days. C-30 days. D-45 days.
C-30 days.
When must agents submit license renewal applications to the Superintendent? A-At least 30 days before the anniversary of the day they received their licenses B-Within 10 business days of their birthdays C-At least 60 days before the license expires D-By the last day of February of every year
C-At least 60 days before the license expires
According to the Fair Credit Reporting Act, all of the following would be considered negative information about a consumer EXCEPT A-Late payments. B-Failure to pay off a loan. C-Disputes regarding consumer report information. D-Tax delinquencies.
C-Disputes regarding consumer report information.
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
Treatment of nonpublic personal financial information about individuals requires the insurer to do which of the following? A-Provide notice to individuals about its privacy policies and practices, no later than at the time an insurance policy is delivered, and annually thereafter. B-Describe the conditions under which a licensee may disclose nonpublic personal financial information about individuals to affiliates and nonaffiliated third parties. C-Provide methods for individuals to prevent a licensee from disclosing that information. An opt out notice must be provided to allow the consumer a choice to limit disclosure of personal information. D-All of the above.
D-All of the above.
Which of the following is NOT a prerequisite for an insurance license in New York? A-Complete prelicensing education B-Be a state resident on the date of application C-Pass the required examination D-Be at least 21 years of age
D-Be at least 21 years of age
Which of the following terms describes making false statements about the financial condition of any insurer that are intended to injure any person engaged in the business of insurance? A-Undercutting B-Twisting C-Slandering D-Defamation
D-Defamation
An insurance agent was born in 1983. He obtained his New York insurance license in 2014. When will the agent's license expire? A-January 1st every even-numbered year B-Every year on the license issue date C-Every 2 years on the license issue date D-On the agent's birthday every odd-numbered year
D-On the agent's birthday every odd-numbered year
Federal law makes it illegal for any individual convicted of a crime involving dishonesty or breach of trust to work in the business of insurance affecting interstate commerce A-Under any circumstances. B-Unless they have served an appropriate prison sentence. C-Without receiving written consent from a Federal Judge. D-Without receiving written consent from an insurance regulatory authority.
D-Without receiving written consent from an insurance regulatory authority.
In order for a nonresident licensee to become a resident producer in New York, the licensee must A-Apply within 90 days of becoming a resident. B-Wait 6 months and close out all existing business. C-Fulfill New York's prelicensing requirements. D-Pass a written exam.
A-Apply within 90 days of becoming a resident.
An agent who includes a statement or omits a statement which, when taken in context of the whole presentation, may tend to mislead or deceive the persons addressed has committed A-Twisting. B-Coercion. C-Misrepresentation. D-Defamation.
C-Misrepresentation.
Under the Fair Credit Reporting Act, individuals rejected for insurance due to information contained in a consumer report A-Must be advised that a copy of the report is available to anyone who requests it. B-May sue the reporting agency in order to get inaccurate data corrected. C-Must be informed of the source of the report. D-Are entitled to obtain a copy of the report from the party who ordered it.
C-Must be informed of the source of the report.
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
A spouse was granted a temporary license for her deceased husband's agency on March 1. On May 1 she processed an application for life insurance on a new applicant. Which of the following is true? A-The spouse's license had expired. B-The application is valid as submitted. C-The application was processed without a valid license. D-The application is not valid as submitted.
C-The application was processed without a valid license.
Every insurance company in the state of New York must file annually with the office of the Superintendent to show that it is A-Admitted. B-Certified. C-Authorized. D-Solvent.
D-Solvent.
Which of the following is NOT correct regarding false statements by a person engaged in the business of insurance? A-Omissions of material fact on insurance application are fraud. B-False statements about financial condition of an insurer are unlawful. C-Statements made with the intent to deceive are unlawful. D-Only written statements can be considered fraud.
D-Only written statements can be considered fraud.
If an individual's license has been revoked, how soon can he or she obtain a new license? A-After 1 year of the revocation B-Within 12 months, based on the original violation C-After 60 days of the revocation D-Never; once revoked, the license cannot be reinstated
A-After 1 year of the revocation
Which of the following acts committed by an agent would be sufficient violation to warrant revocation or suspension of the agent's license? A-Forgery B-Speeding in an automobile C-Trespassing through a neighbor's yard D-Public drunkenness
A-Forgery
Which of the following is NOT a qualification for licensing as an insurance producer in this state? A-Have a letter of recommendation attesting to the applicant's trustworthiness B-Complete the required minimum hours of prelicensing training C-Be at least 18 years of age D-Be a state resident at the date of application
A-Have a letter of recommendation attesting to the applicant's trustworthiness
Which of the following is NOT true concerning the purpose of the Insurance Fraud Prevention Act? A-It helps insurers to not sell policies to those applicants who are high risks. B-It permits the Department to receive assistance from federal and state law enforcement agencies. C-It permits the Superintendent and Department to investigate insurance fraud. D-It helps stop fraudulent acts more effectively.
A-It helps insurers to not sell policies to those applicants who are high risks.
Under the Fair Credit Reporting Act, if the consumer challenges the accuracy of the information contained in his or her report, the reporting agency must A-Respond to the consumer's complaint. B-Defend the report if the agency feels it is accurate. C-Change the report. D-Send an actual certified copy of the entire report to the consumer.
A-Respond to the consumer's complaint.
Which of the following is NOT considered a misrepresentation as it pertains to unfair trade practices? A-Exaggerating the benefits provided in the policy B-Making comparisons between different policies C-Making misleading oral statements about a policy D-Stating that the insurance policy is a share of stock
B-Making comparisons between different policies
Which of the following individuals must pass the written examination to be licensed as an insurance agent? A-A ticket-selling airline representative for one-time issuance of baggage or accident insurance B-An applicant who has passed the written examination for an insurance agent's license in the past if he applies within 2 years following the date of license termination C-A producer previously licensed in New Jersey who is applying for a New York license 120 days after becoming a resident of this state D-A nonresident licensee currently licensed in another state
C-A producer previously licensed in New Jersey who is applying for a New York license 120 days after becoming a resident of this state
Which of the following would be required to be licensed as an insurance producer? A-A salaried full-time employee who furnishes information for group insurance B-An insurance company director who performs executive, administrative and managerial duties C-A salaried employee who advertises and solicits insurance D-A person whose activities are limited to producing insurance advertisements
C-A salaried employee who advertises and solicits insurance
All of the following are reasons to terminate an agent's certificate of appointment EXCEPT A-An agent's license expires and is not renewed. B-An appointment is terminated by the insurer under the terms of agent's contract. C-An agent's license is suspended or revoked. D-An agent becomes disabled and is unable to complete his duties for the duration of the disability.
D-An agent becomes disabled and is unable to complete his duties for the duration of the disability.
Which of the following would NOT be considered rebating? A-Sending a gift certificate to the insured's employee after the insurance has been effected as a thank you for the referral B-Sharing commission with the insured C-Collecting a lower premium than what is specified in a policy as a token of client appreciation D-Giving a client a $20 pen with the insurer's logo during the insurance application process
D-Giving a client a $20 pen with the insurer's logo during the insurance application process
It would be considered unfair discrimination to ask an insurance applicant about which of the following and then use that information as a rating factor to determine insurability? A-Age B-Gender C-Address D-Sexual orientation
D-Sexual orientation
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.
A certificate of appointment is valid until any of the following EXCEPT A-The agent becomes a nonresident licensee in another state. B-The agent's license is suspended or revoked. C-The agent's license expires and is not renewed. D-The appointment is terminated by the insurer under the terms of the agent's contract.
A-The agent becomes a nonresident licensee in another state.
In which of the following situations is it legal to limit coverage based on marital status? A-Divorce within the last six months of applying for insurance B-It is never legal to limit coverage based on marital status. C-Excessive number of divorces, as defined by the Insurance Code D-Legal separation during the application process
B-It is never legal to limit coverage based on marital status.
In comparison to consumer reports, which of the following describes a unique characteristic of investigative consumer reports? A-The customer has no knowledge of this action. B-The customer's associates, friends, and neighbors provide the report's data. C-They provide additional information from an outside source about a particular risk. D-They provide information about a customer's character and reputation.
B-The customer's associates, friends, and neighbors provide the report's data.
In order to qualify for a certificate of authority, every person, firm, association, corporation or joint-stock company must meet all of the following requirements EXCEPT A-If a mutual company, provide statements of at least 3 incorporators, proof of the required initial surplus in cash or investments, and the required number and amount of actual applications for insurance. B-The entity must be part of the New York Labor Union. C-The entity must fully comply with all applicable provisions of New York's insurance laws. D-If a stock company, the amount of capital and surplus required by law must be paid in cash or investments.
B-The entity must be part of the New York Labor Union.
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
