Nevada Statues and Codes Common to All Lines Quiz Questions Chapter Ten

Every insurance administrator must file a surety bond with the commissioner, which is written for an amount of at least?

Answer: $100,000 Explanation: no person may act as an administrator, or hold themselves out to the public as an administrator, unless they have obtained a certificate of registration as an administrator from the commissioner, and filed a bond issued by an authorized Shorty in favor of the state of Nevada , continuous inform, and in amount, determined by the commissioner of not less than $100,000.

How many hours of approved continuing education within a three-year period are required?

Answer: 30 Continuing Education units Explanation: each licensee must certify that he, or she has successfully completed 30 hours of approved, continuing education within a three-year period before the date of renewal of his or her license.

When requested by a person, aggrieved by an act, a hearing must be held within how many days after the commissioner receives the written demand?

Answer: 30 days Explanation: the commissioner shall hold a hearing within three days after filing the application, unless postponed by mutual consent.

Which of the following will not be considered a limited lines, producer license? A. A producer selling only life insurance. B. A producer selling rental car insurance. C. A producer selling travel, or baggage insurance. D. A producer selling life insurance only.

Answer: A producer selling only life insurance Explanation: a limited lines, insurance producer is authorized to solicit only specialty insurance products, such as credit life, fixed, annuities, travel and baggage, or rental car insurance. Life insurance is not a limited lines insurance.

The document that indicates that an insurer has been approved and is authorized to transact insurance in a particular state is known as?

Answer: Certificate Authority Explanation: when the commissioner of a particular state has determined that an insurer has met all of the requirements for transacting insurance in that state, a certificate of authority shall be issued to that insurer.

Which of the following best describes an insurance company that has been formed under the laws of this state?

Answer: Domestic Explanation: A company is domestic when doing business within the state in which it is incorporated.

When an agent is handling premium funds, while conducting business, the insurance agent acts in a?

Answer: Fiduciary capacity Explanation: money designated as premium belongs to the insurance company. An agent is handling this money in a position of trust. Fiduciary is the term that refers to the handling of money.

They requirement that agents must account for all insurance, funds collected, and without the express consent of the insurance company(ies) are not permitted to commingle those funds with their own funds, is known as?

Answer: Fiduciary responsibility Explanation: money collected with respect to an insurance transaction must be held in a position of trust by the agent.

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

Answer: It is never legal to limit coverage based on marital status. Explanation: availability of insurance, benefits, or coverage may not be denied based on sex or marital status. Marital status may be considered for the purpose of defining person, eligible for dependent benefits.

Which of the following is not considered a misrepresentation as it pertains to unfair trade practices? A. Making comparisons between different policies. B. Stating that the insurance policy is a share of stock. C. Exaggerating the benefits provided in the policy. D. Stating that the competitors will arbitrarily increase their premiums each year.

Answer: Making comparisons between different policies Explanation: Making accurate comparisons of policies is NOT illegal.

Which of the following best describes the unfair trade practice of defamation? A. Refusing to deal with other insurers. B. making derogatory oral statements about another insurer financial condition C. Assuming the name and identity of another person. D. Issuing false advertising material.

Answer: Making derogatory oral statements about another insurer's financial condition Explanation: making oral or written statement, directly, or indirectly, which are derogatory or maliciously critical of another, and shorter, would be an example of the unfair trade practice of defamation

The commissioner of influence is responsible for all of the following actions except?

Answer: Setting premium rates Explanation: the commissioner organizes, manages and supervises all the activities of the division of insurance. Commissioner may also examine investigate all authorized insurers. The Commissioner does not, however, set the premium rates - those are established by law.

When a producers appointment with the insurer is terminated, who must notify the commissioner?

Answer: The appointing insurer Explanation: an insurer, or its authorized representative, who terminates the appointment, or other relationship of a producer, for any reason, must notify the commissioner within 30 days after the effective date of the termination.

Agents who persuade insureds to cancel a policy in favor of another one when it might not be in the insured's best interest are guilty of?

Answer: Twisting Explanation: Twisting is a misrepresentation that persuades an insured, or a policy owner, to their detriment, to cancel, lapse, or switch policies.

The mechanism used by individuals to transfer their risk of loss to a larger group of individuals that have similar exposure to loss is called?

Answer: insurance Explanation: insurance is the mechanism where an insured is protected against, lost by a specified future contingency or peril in return for the present payment of premium. Because many other individuals, with the same or similar risk of loss are paying premiums, funds are available to indemnify those who actually suffer that loss .