Life & Health

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Instead of revoking or suspending an insurance license, the Superintendent may:

- Require a licensee to pay a penalty up to $500 per offense -Pay a maximum penalty of $2,500 for all offenses

Examples of Rating services

-AM Best Company -Standard & Poor's -Moody's Investment Servives -Weiss Insurance Rating - Fitch Ratings

An insurance producer may have his/her license suspended or revoked by earning commissions for business written on his/her own property and risks if the commission received are more than what percentage of the licensee's net aggregate commissions during the preceding 12 months ?

10%

If the Superintendent determines a licensee is liable for a civil penalty, he/she may enter a judgment against the licensee within __________ of the determination

120 days

Insurance producers are required to complete how many hours of approved continuing education during each 2-year license period?

15

Within how many days from the date of execution of the agency contract or the date the first insurance application does the certificate of appointment hae to be filed

15 days

How long are the terms that insurance licenses are issued for ?

24 months (2 years)

All licensees are required to notify the superintendent of a change in address within__________ of the change

30 days

License renewal applications must be submitted no few than___________days before the expiration of the licesnse to avoid a __________late filing fee

60, $10

Foreign Insurer

An insurer organized under the laws of any other state, possession, territory, or the District of Columbia of the United States, whether or not it is admitted to do business in this state.

Domestic Insurer

An insurer organized under the laws of this state, whether or not it is admitted to do business in this state

Fradulent insurance Act

Any act committed by a person who, knowingly and intentionally plans to defraud an insurer, self-insurer, or agent by submitting any written statement in connection with an insurance application, certificate of insurance, or claim that while knowing the statement contains materially false information concerning any material fact or conceals, for the purpose of misleading, information concerning any material fact

What is the penalty for transacting insurance without a certificate of authority?

$1,000 (first violation ) $2,500( each subsequent violation

What is the fee for a replacement license?

$15

What is the overall maximum penalty for not filing an annual statement

$25,000

What is the max daily penalty for failing to file an annual statement

$250 /day

What is the penalty for violating the "aiding unauthorized insurer" provision

$500

Joint Underwriting Association/ Joint Reinsurance Pool

Requires insurers writing specific coverage lines in a given state to assume their share of profits/losses or the total voluntary market premiums

Moral turpitude

an act or behavior that gravely violates the sentiment or accepted standard of the community

Insurance provider

an individual who is licensed to sell, solicit, or negotiate insurance in New York

nonresident insurance agent/broker

an individual who is not a resident of New York and who is licensed or authorized to act as an insurance agent or broker in the state where he/she resides

personally identifiable financial information

any information -a consumer provides to a licensee to obtain an insurance policy or insurance services -about a consumer that results from an insurance transaction between a licensee and the consumer -a licensee obtains about a consumer in connection with the provision of insurance services or products to that consumers

warranty

any insurance contract provision that conditions the applicability of coverage on any fact that either reduces or increases the likelihood of any loss, damage, or injury- including death, disability, injury , physical and moral hazards, and any cause of loss or peril insured against

Insurance Agent

any person (individual or business entity) authorized or acknowledged by an authorized insurer to act as its agent in the solicitation, negotiation, or sale of insurance

Insurance broker

any person (individual or business entity) who , in exchange for commision or any type of compensation, helps another person- in any manner- to 1. solicit, negotiate, or sell insurance 2.place insurance 3.purchase insurance

independent adjuster

any person or business entity that, in exchange for money, commission, or anything of value- acts on behalf of an insurer to investigate and adjust insurance claims arising under the insurers policies

public adjuster

any person or business entity that-in exchange for money, commision, or anything of value- acts on behalf of an insured to investigate and adjust insurance claim.

Residual Markets

are a last resort private coverage source for businesses and individuals who have been rejected by the voluntary insurance market

self-insurers

assume all of the financial risk faced without transferring that risk to an insurer sets aside funds in an amount equal to or greater than the expected losses

Insurance Agencies

captive or independent organizations that recruit, contract with, train, and support insurance producers.

Insurance Frauds Bureau

charged with detecting, investigating, and preventing insurance fraud and referring fraudsters for prosecution

Insurance brokers act on behalf of the _________

client

The National Association of Insurance Commissioners

consists of all state and territorial insurance commissioners/ regulators provides resources, research, legislative and regultory recommendations and interpretations for state insurance regulators -promotes uniformity among states members may accept or reject recommendations has no legal authority to enact or enforce insurance laws

Lloyd's of London

consists of groups of underwriters called Syndicates, each of which specializes in insuring a particular type of risk ( not an insurance company) members are individually liable for each risk they assume

clear and conspicuous

a notice is reasonably understandable and is designed to call attention to the information it contains and the importance of that information

The Superintendent is responsible for:

-ensuring the solvency of the state's insurers -eliminating insurance fraud, criminal abuse of the insurance industry, and unethical conduct in the transaction of insurance in this state -receiving and mediating consumer complaints and referring them to any appropriate federal, state or local law enforcement agencies

What must the certificate of authority contain?

-insurer's name -home office address -the certificate's term -the state or country in which the insurer was organized - the lines of insurance for which the insurer is authorized to transact in this state

A license is considered to be in good standing during its term unless:

-it is revoked or suspended by the superintendent -all certificates of appointment have been terminate by insurers (if this occurs, the license becomes inactive_ -the license fails to file a renewal application, if it was in good standing before expiration.

continuing education statutes do not apply to:

-licensees holding licenses that did not require an examination -limited and other licensees that are exempt from continuing education requirements by the superintendent -life settlements, if the licensee is acting as a life settlement broker with a life line of authority

Continuing education statutes applies to resident and nonresident licensees with the following lines of authority :

-life insurance, annuities, variable annuities, and variable life insurance -sickness, accident, and health insurance -all lines of property and casualty insurance -life settlements

Requirements for RRGs

-must be made up of a large number of homogeneous or similar units -membership is limited to risks with similar liability expsoures - must have sufficient liquid assets to meet loss obligations

Stock Insurance Company

-private and for profit -owned by stockholders or shareholders - directors and officers are elected by stockholders and put in place a management team to carry out the company's mission -stockholders may receive taxable corporate dividends as a share of the company's profit when and if declared by the directors

Any person, firm association, corporation is prohibited from acting as an agent or broker to conduct any of the following activities on behalf of an unlicensed or unauthorized insurer

-solicit insurance -negotiate insurance -effectuate insurance -place risks with such an insurer -in any manner, assist or aid such an insurer in effecting any insurance agreement, policy, or contract

Once a license has been revoked, the licensee cannot obtain any type of insurance licensee in this state for at least ____________ from the date of revocation or from the date of a final determination resulting from any judicial review

1 year

Public Adjuster License Requirements

1. 1 year of experience in the insurance business that involves sales, underwriting, claims or other appropriate experience. 2. 40 hours of formal training in an approved course or program of instruction

Adjuster Licensing Requirements

1. cannot act on behalf of an insurer unless licensed as an independent adjuster 2.cannot act on behalf of an insured unless licensed as a public adjuster 3. 18 years old 4. complete license application/ pay fees 5. No criminal record/employed someone who has 6. Provide references that satisfy appropriate requirements

Certificate of appointment are valid until

1. terminated by the carrier according to the agency contract's provisions 2. the agent's license is suspended or revoked 3.the agents license expires and it does not renew

Before a resident license can be revoked or suspended, the Superintendent must give the licensee and all sublicensees a hearing with ___________

10 days advance notice

The Superintendent must give a nonresident liensee___________ before revoking a license

10 days' written notice

Reciprocal Insurance Company

a group-owned insurer whos main activity is risk sharing formed by individuals, firms, and business corporations that exchange insurance on one another

McCarran-Ferguson Act of 1945

Established that the federal government will not regulate the business of insurance in areas which the states have historically had the authority to do so (such as producer and company licensing) unless the states fail to cooperate.

certificate of authority

a license issued to an insurance company authorizing it to transact insurance in this state

Risk Sharing Plan

Insurers agree to apportion among themselves those risks that are unable to obtain insurance through normal channels.

When do business entity licenses renew/expire (property and casualty lines of authority)

June 30th of even-numbered years

When do business entity licenses renew/expire ( life and health lines of authority)

June 30th of odd-numbered years

By what day does the insurer have to file an annual financial statement with the Superintendent

March 1

Fraternal Benefit Societies

Primarily social organizations that engage in charitable and benevolent activities that provide life and health insurance to members; membership consists of members of a given faith, lodge, order, or society; usually organized on a non-profit basis.

what is the best manner in which a licensee must provide a clear and conspicuous notice to its customers that accurately reflects its privacy policies and practices?

The notice must be provided at the time the insurance application is taken and annually therafter

Affiliate

a company that controls, is controlled by, or is under common control with another company

Federal Insurance Office (FIO)

established by the Dodd-Frank Wall Street Reform and Consumer Protection Act monitors: -the insurance industry and identifies issues and gaps in the state regulation of insurers -access to affordable insurance by traditionally under deserved communities and consumers, minorities, and low-and moderate-income persons

Insurance Frauds Prevention Act

established to eliminate the commission of arson as a form of insurance fraud

Independent Financial Rating Services

evaluate and rate the claims paying ability and financial stability of insurance companies assign letter ratings that indicate the financial strength of each company which may be based on both public and nonpublic data

On what basis do non-exempt resident and nonresident licensees have to complete approved continuing education courses

every 2 years ( biennial)

The superintendent has the authority to create insurance laws (true or false)

false

what must be done if an agent apointment is terminated for cause

file with the Superintendent a statement containing the reason for termination within 30 days of the termination

Risk Retention Groups (RRG)

group-owned insurers that primarily assume and spread the liability-related risks of its members. They are owned by their policyholders, and are licensed in at least one state. However, they may insure members of the group in other states.

Nonpublic Personal Health Information

health information that identifies an individual who is the subject of the information or provides a reasonable basis to believe the information could be used to identify a specific individual

In what situation does a licensee write controlled businnes

if he/she receives more than 10% of his/her aggregate net commisions in the preceding 12-month period from the placement of insurance on the life of, or property owned by -the spouse of the individual applicant/licensee -any corporation of which the individual applicant/licensee and/or his/her spouse own more than 50% of the shares -of any firm or association of which the individual applicant/licensees and/or his/her spouse are members

Reinsurance Companies

insurance companies that operate to accept all or a portion of the financial risk of loss from the primary (or "ceding") insurance company

insurance producers

licensed individuals representing and appointed by an insurance company when transacting insurance business

Treaty Reinsurance Agreement

reinsurance agreement that automatically accepts all new risks presented by the ceding insurer ( the company seeking or requesting the reinsurance from the reinsurer)

Insurance companies

manufacture and sell insurance coverage in the form of insurance policies or contacts of insurance

Firms/ Associations

may authorize its members and employees to act as individual insurance consultants on its behalf

Corporations

may only authorize the sublicensees listed on its license to act as individual insurance consultants on its behalf

Insurance consultant

meets with clients and discusses insurance, providing advice and recommendation in exchange for a consulting fee based upon a written agreement signed by the client

When do individual licenses renew/expire ( even numbered year birthday)

on the individuals birthday in each even numbered year

When do individual licenses renew/expire (odd numbered year birthday)

on the individuals birthday in each odd numbered year

Fiduciary

one who is entrusted to care for, or act on behalf on another

mutual insurance company

owned by policyholders (member) that elect Board of Trustees/Directors. Policy holders may receive non-taxable dividends as a return of any divisible surplus Board of Trustees carries out the company's mission

Nonpublic Personal Financial Information

personally identifiable financial information and any customer list, description, or grouping that is derived using personally identifiable personal information that is not publicly available

Non-participating Polices

policy holders not entitled to receive dividends

Participating polices

policyholders are entitled to receive any dividends as a return of excess premium

sell/sale

refer to the exchange of insurance for money or its equivalent on behalf of a licensed insurer, fraternal benefit society, or HMO

solicit/solicitation

refers to the attempt to sell insurance or to ask or encourage a person to apply for a particular type of insurance from a particular licensed insurance company, fraternal benefit society, or HMO

Domicile

refers to the jurisdiction (i,.em state or country) where an insurer is formed or incorporated

Negotiate/ Negotiation

refers to the process of one individual discussing with another person a specifc insurance contract and its major benefits, terms, and/or condition - so long as the person engaging in the negotiation either sells or obtains insurance from licensed insurers, fraternal benefit societies, or HMOs

Facultative Reinsurance Agreement

reinsurance agreement that allows the reinsurance company an opportunity to reject coverage for individual risks, or price them higher due to their substandard (higher risk) nature

A temporary insurance license authorizes the licensee to ____________

renew existing insurance on behalf of the original licensee

What must the superintendent do after a hearing ?

serve a a copy of a written report that contains his/her findings upon the person charged and any other involved party

business entity

term includes a corporation, association, partnership, limited liability company, limited liability partnership, or other legal entity.

Home State

the U.S location where the person mantains a principal place of residence or business and in which the person is licensed to act as an insurance producer

capital and surplus

the amount of the insurer's assets after liabilities are subtracted..

What do the requirements for a certificate of authority include ?

the insurer meeting the capital and surplus requirements of insurance code

An Insured

the person or entity that is covered by the insurer, which covers losses due to loss of life, health, property, or liability

An Owner

the person responsible for paying the policy's premium; this person is not necessarily the insured under the policy, but has various rights that are specified in the contract

Rebating

the unfair and prohibited practice that involves the offer of a special premium or favor as an incentive to purchase insurance

persons who are excluded from the definition of "insurance broker"

those who are not required to be licensed as an "insurance producer"

Commissioner, Director or Superintendent

typically appointed by the Governor, has the power to issue rules and regulations to help enforce these statutues

What is the penalty for violating a cease and desist order

up to $5,000

What is the civil penalty that the Superintendent is authorized to impose in case of a fraudulent insurance act

up to $5,000 plus the amount of the claim for each violation


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