Arizona Life Insurance Chapter 11: Laws and Rules

The maximum prison sentence given under federal law for unfair and deceptive insurance practices is

15 years

A life insurance policy in Arizona becomes incontestable after it has been in force for

2 years

An annuity becomes incontestable after it has been in force for

2 years

A licensee whose name or address changes must notify the Department of Insurance within

30 days

A terminated employee has how many days upon termination to convert group life insurance coverage to an individual policy?

31 days

An insurance company may delay the payment of the cash value of a surrendered whole life insurance policy for up to

6 months

Under the Telemarketing Sales Rule, telemarketing calls may NOT be received until

8:00 AM

Under the Telemarketing Sales Rule, telemarketing calls may ONLY be received between the hours of

9:00 AM and 10:00 PM

Under the Telemarketing Sales Rule, telemarketing calls may NOT be received after

9:00 PM

In Arizona, an attempt to defraud an insurance company is considered

A felony

The term "life settlement broker" may refer to

A licensed life settlement provider

All of the following are unfair claims settlement practices EXCEPT

An attempt to settle a claim by arbitration

The administration of a reciprocal insurer who manages the premiums collected from the group's members is called

An attorney in fact

The administrator of a reciprocal insurer who manages the premiums collected from the group's members is called

An attorney in fact

When a company is licensed by the Department of Insurance to do business in this state, it becomes

An authorized company

All of the following may obtain a temporary's producer's license EXCEPT

An employee of a licensed producer who is retired

Misrepresenting pertinent policy provisions relating to coverage after a loss is

An unfair claims settlement practice

The refusal of doing business with an individual or business is call a(n)

Boycott

An insurer that confines or largely limits the exposures it writes to those of its owners is called

Captive

Proceeds of a life settlement contract could be subject to the claims of

Creditors

Under which marketing system do insurers solicit customers by mass media advertising and mail without the services of an agent?

Direct response

Arizona law requires the Human Immunodeficiency Virus (HIV) consent form to

Disclose the types of individuals or organizations that may receive a copy of the test results

A producer's license may be suspended

For misappropriation of premiums

When determining the suitability of an annuity for a consumer, the insurance provider is obligated to

Make reasonable efforts to fit the annuity with the consumer's needs

Life settlement brokers are permitted to do all of the following EXCEPT

Make the first transaction up to 30 days before approved for a license

If a producer misleads or fails to adequately disclose the title and true nature of a policy offered to a potential insured, it may be considered

Misrepresentation

When advertising a life insurance policy, a producer is required to disclose the

Name of the actual insurer

A life insurance producer is required to give a disclosure notice about information practices to an applicant or proposed insured

Prior to or at the time of signing the application

The Director may suspend a producer's license when the producer

Rebates a portion of the commission to the insured

All of the following claims settlement practices could initiate a cease and desist order EXCEPT

Refusing to pay a claim without conducting a reasonable investigation of all available information where material facts are in dispute

Any of the following may be unfair claims settlement practices EXCEPT

Refusing to pay persons bringing false or fraudulent claims

A transaction in which a new life insurance policy is purchased and an existing life insurance policy is surrendered is called

Replacement

Regulations for variable insurance contracts are set by all of the following EXCEPT

Securities and Exchange Commision

Security laws passed by Congress are enforced by which Federal agency?

Security and Exchange Commission

Regulations for variable insurance contracts are set by all of the following EXCEPT

State attorney general's office

Under the Fair Credit Reporting Act

The consumer who was investigated must be advised that credit, insurance employment was denied because of an unfavorable report.

Under the Fair Credit Reporting Act, which statement is true?

The consumer who was investigated must be advised that credit, insurance or employment was denied because of an unfavorable report.

The Arizona Life and Disability Insurance Guaranty Fund protects an insured in the event of

The insurer's insolvency

Unless it is regarding fraud, which of the following statements about the contestability of a life Insurance policy is true?

The policy can usually only be contested by the insurer during the first two years of contract

When an individual purchases insurance as a result of threats made by the producer, there has been a violation of

Unfair trade practice laws

When replacing a life insurance policy, which of the following is advisable?

Wait until the new policy is issued and delivered before surrendering existing policy

If a basic illustration is not provided, an insurer MUST provide a policy summary to a prospective insured at which of the following times?

When the policy is delivered

When an insured under a group life insurance plan in Arizona elects the conversion option, the new policy is issued

Without requiring evidence of insurability

An insurer operating in the U.S. but headquartered outside the U.S. is

an alien insurer

Which provision makes the application part of the annuity contract?

Entire Contract clause

The period during which a buyer may return a fixed annuity contract for a full refund is called the

Free look period

A life insurance illustration showing future premiums being paid out of nonguaranteed values must disclose that

The policyowner may need to resume premium payments depending on actual results

A licensed producer who lives in another state and transacts insurance in Arizona is called

a nonresident producer

During the first two years a life insurance policy is in force, the insurer may contest a policy for all the following reasons EXCEPT

Misstatement of age in the application

Illustrations used in the sale of life insurance contain a statement that must be signed by

The producer

A whole life policy that provides a choice of dividend options must include the following statement about dividends

They are not guaranteed

A producer must maintain customer records for how many years following the completion date of the insurance transaction?

Three

A producer must report to the Director any administrative action taken against her by any governmental agency within

30 days

Which of these situations would NOT potentially involve a prison sentence under Federal law?

Transacting insurance with a nonresident license

According to the Federal Fraud and False Statements Act, which of these is considered to be an intentional violation?

Making false entries in a company's books

According to the federal fraud and false statements regulation, what is required for a prohibited person to transact insurance business in this state?

Written consent from the state insurance regulatory agency