Chapter 10

After an insurer has filed an application for a certificate of authority, how long does the Commissioner have to approve the application

90 days

commission

payment to the agent by the insurance company for placing insurance, usually a percentage of the policy premium

An insurance agent's responsibilities include all of the following EXCEPT

Incorrect: Represent the client Correct: perform faithfully; represent the insurer; perform professionally

Which of the following is NOT true regarding a Certificate of Authority?

Incorrect: it is issued to group insurance participants (*before insurers may transact business in a specific state, they must apply for a license or Certificate of Authority from the state department of insurance and meet anh financial (capital and surplus) requirements set down by the state*) Correct: it is equivalent to an insurance license; it is issued by the state department of insurance; it may be necessary for transacting business in a specific state

How is the Commissioner of Insurance selected to be the chief officer of the Department of Insurance

elected to office

Which of the following is the closest term to an authorized insurer?

Admitted (insurers who meet the state's financial requirements and are approved to transact business in the state are considered authorized or admitted into the state as a legal insurer

When does a producer's license expire

Every 2 years on the last day of the producer's birth month

Which requirement provision allows an insured to pay overdue premiums within 30 days for a life insurance policy to remain in effect?

Grace period

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

It is never legal to limit coverage based on marital status

moral turpitude

conduct that is contrary to community standards of justice, honesty or good morals

If the Commissioner is not able to serve due to disability, resignation, or death, which of the following will happen?

The Chief Deputy Commissioner will serve as the Commissioner until the next election

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?

defamation

An outline of coverage must be given to the applicant for a long-term care policy no later than

The time of initial solicitation

statute

a formal written law enacted by legislature; insurance statutes can be found in the state Insurance Code

reciprocity

a mutual interchange of rights and privileges

inducement

an offer that attempts to influence the other party

disclosure

revealed information to help someone make an intelligent and educated decision

commissioner

the head of the State Department of Insurance

promulgate

to make public, to put into action (e.g. laws, court decrees, and similar)

cease and desist

to stop or discontinue

insolvent

unable to meet financial obligations

Once an agent has met the requirements to sell long-term care insurance partnership policies, how often must the agent complete the 4 hours of ongoing training courses.

every 24 months

All of the following are examples of violations of replacement EXCEPT

Correct: advising an applicant to answer questions correctly Incorrect: failing to ask the applicant questions regarding replacement; intentionally answering a question incorrectly; any deceptive or misleading information

surplus lines

insurance not available from authorized insurers; placed with non admitted insurers who specialize in offering insurance to the high-risk market

authorized insurer

insurer who has received a Certificate of Authority from the department of insurance to transact insurance in this state

How long is the waiting period for benefits to be paid in a long-term care policy or rider

90 days

Medicare supplements specifically exclude all of the following EXCEPT

Incorrect: surgical expenses of persons eligible for Medicare (*Medicare supplement policies are designed primarily as supplements to reimbursements under Medicare for the hospital, medical or surgical expenses of a persons eligible for Medicare. These policies do not include Medicare Advantage plans, outpatient prescription drug plans or any Health Care Prepayment Plan that provides benefits related to Social Security*) Correct: medicare advantage plans; outpatient prescription drug plans; any health care prepayment plan providing benefits related to Social Security

home office

insurer's headquarters, principal place of business

Lloyd's Associations

operate an insurance mechanism, in which members are liable only for their portion of risk (not an insurance company)