Delaware Insurance Laws

No more than 10,000 for each act act of insurance fraud.

What is the maximum administrative penalty for an act of insurance fraud by any person in this state?

300 weeks= 5 years and 7 months.

What is the maximum amount of time for an injured worker to receive compensation for partial disability under workers compensation?

To prevent a producer or insurer from further violating laws for transacting insurance.

What is the purpose of a cease-and-desist order?

To assure stability in the property insurance market of this state, to make basic property insurance available for qualified property.

What is the purpose of the Delaware FAIR Plan?

provides a mechanism for the payment of covered claims under certain insurance policies to avoid excessive delay in payment and to avoid financial loss.

What is the purpose of the Guaranty Association Act?

Basic property insurance to eligible risks.

What kind of insurance does the FAIR Plan provide?

Surgical, medical, dental, optometric, chiropractic, and hospital services, medicines and supplies, etc.

What medical benefits are required by the Workers Compensation Laws?

-18 years of age. -competent, trustworthy, financially responsible and of good reputation, -not committed any act that is grounds for denial, suspension or revocation. -has paid the appropriate fees with an application for each line of authority. -has successfully passed the examination(s) for the line(s) of authority for which the person has applied.

What qualifications must a candidate for a producer license meet in this state?

The broker must file this affidavit with the commissioner within 30 days after the insurance was affected.

When is a surplus lines broker required to execute an affidavit?

Does not offer a binding authority.

Describe the binding authority of agents for NFIP policies.

The issuance and delivery by an insurer, at the end of a policy period, of a policy superseding a policy previously issued and delivered by the same insurer or the issuance and delivery of a certificate or notice extending the terms of an existing policy beyond its policy period.

Define the term "renewal" in property policies.

-Nonpayment of premium. -Discovery of fraud. -Willful or reckless acts of omissions. -etc.

For what reasons may a property policy be cancelled?

-Nonpayment of premium. -the policy was obtained through misrepresentation. - Any insured violated any of the terms and conditions of policy.

For what reasons may an auto policy be canceled or nonrenewed?

The fee to renew a license is $300 and the license runs from January 1st for a full year.

How and when are premium finance company licenses renewed?

Chosen by qualified electors of the state at general elections and commissioned by the governor for a term of 4 years.

How is the commissioner of insurance selected for office, and how long is the term?

notice within 30 days.

How long does a producer have to notify the commissioner of change of name or address?

The recorded must be open to examination by the commissioner at all times within 5 years after issuance of the coverage to which it relates.

How long must surplus lines brokers maintain records?

30 days before the end of the policy period.

How much notice is required for nonrenewal of a property policy?

30 days prior to the effective date of cancellation, but if its due to nonpay it much be at least 10 days prior.

How much notice must the insurer give the insured when canceling an auto policy?

$3,500.

How much will workers compensation provide for funeral expenses?

as often as deemed appropriate, but at least once every five years.

How often must the commissioner examine insurers' books and records?

no

Is it legal to present an insurance policy as a share of stock?

Coverage A: Building Property Coverage B: Personal Property Coverage C: Other Coverages Coverage D: Increased Cost of Compliance

The general property policy form provides four coverages. What are they?

Dwelling Policy Form, General Property Policy Form, and Residential Condominium Building Association Policy Form.

The national flood insurance program is comprised of what three forms?

15 Days.

To avoid unfair claims settlement practices, an insurer must acknowledge a claim within how many days of receipt of notice of claim?

-Providing false information. -Violating insurance laws. -Obtaining a license through fraud. - Convicted a felony. -Cheating on an exam.

Upon what grounds can the Commissioner revoke or suspend a producer license?

fine of up to 2,300 per violation, imprisonment for up to 1 year, or both. The maximum fine for corporations is 6,900 per violation.

What are the applicable penalties for violations of the insurance code?

-Grant or deny applications for certificates of authority. -Examine each insurer, rating organization, or any other organization or association authorized to transact insurance in this state; -Enforce and execute the duties imposed by the insurance code; -Adopt and promulgate rules and regulations; -Have the powers and expressed authority to carry out all duties; -Enforce payment of fee, charges and taxes; -Have additional rights, powers and duties provided by other laws of Delaware.

What are the broad powers and duties of the commissioner of insurance?

-every 2yrs. -24 credit hours. -3 need to be in ethics. -if a producer holds a health license who solicits long term care policies, they must complete 3 hours in courses on long term care insurance. -Resident adjusters: 12 credit hours, 3 in ethics. -5 credits NOT from ethics, that can carry over to the next license period.

What are the continuing education requirements for producers in this state?

15,000/30,000/10,000

What are the minimum liability limits for auto insurance in Delaware?

15,000/30,000

What are the minimum required liability limits for uninsured motorist coverage?

express, implied, apparent

What are the types of authority?

any inducement offered to the insured in the sale of insurance products that is not specified in the policy.

What constitutes rebating?

full coverage or liability

What coverages may be selected on Form A?

Classification of exposure to different hazards, and expenses based on any rate attributable to acquisition.

What factors are workers compensation rates based on?

-must be in compliance with the insurance title code and must be an incorporated stock, mutual, or reciprocal insurer.

What factors qualify an insurer for a certificate of authority?

-Household worker -Casual worker in a private home. -Household who earns less than $750 in cash in any 3-month period from a single private home or household. -Farm laborers or their respective employers.

What forms of employment are excluded from the Workers Compensation laws?

DMV will assess the owner of the vehicle w/ a penalty of $100 for each vehicle without the required insurance for a period of up to 30 days.

What happens if you let your auto insurance lapse during the insured vehicle's registration year?

The benefits will be gone until they remarry and will get 2 years of indemnity benefits in a single lump-sum.

What happens to the surviving spouse's workers compensation benefits if he/she remarries?

"Write Your Own" service policies on a no bear risk basis through a special arrangement with the Federal Insurance Administration.

What is a WYO insurance company, and how is it used?

A person who is responsible for the property of another.

What is a fiduciary?

An agreement by which an insured or prospective insured promises to pay to an insurance premium finance company.

What is a premium finance agreement?

A person engaged in the business of entering into premium finance agreements or otherwise financing the payment of insurance premiums.

What is an insurance premium finance company?

Mixing the client's money with the producer's personal money.

What is commingling?

To place insurance in an unauthorized insurer under the surplus limes law covering a subject of insurance resident, located or to be performed in Delaware.

What is the definition of export?

Agency is a fiduciary relationship between and person and a brokerage. An individual is a representative of one or more insurance companies and must be appointed by a company.

What is the difference between an individual license and an agency?

Implied

Which type of authority is not expressed or written into the contract, but which the producer is assumed to have in order to transact the business?

The commissioner

Who determines which classes of insurance are eligible for export?

Any person having an insurable interest in real and tangible personal property at a fixed locations who has made a diligent effort to obtain basic property insurance.

Who is eligible for insurance through the Delaware FAIR Plan?

An insurance producer holding a valid property and casualty license for the State of Delaware.

Who is eligible to write insurance through the Delaware Automobile Insurance Plan?

The insurance producer is responsible.

Who is responsible for collecting the required premium for insurance through the automobile Insurance Plan?

To provide insurance coverage for people who hold a valid driver's license and are entitled to, but unable to obtain insurance through the voluntary market.

Why was the Delaware Automobile Insurance Plan created?

To protect against financial losses that could occur due to an agent's negligent acts.

Why would an agent wish to purchase errors and omissions insurance?