Illinois Life Producer State - Designated Exam SIMULATOR (75 questions)
All of the following are examples of insurance advertisements
1. A celebrity endorsement of an insurance company 2. A mass mailing announcing a new insurance product 3. A full page announcement of an insurer conducting business in a new territory
List actions that constitute life insurance policy replacement
1. Cash surrender an existing policy and purchase a new policy 2. Discontinue premiums on an existing policy and apply the payments to a new policy 3. Take reduced paid-up insurance and purchase a new policy with another insurer
The director is permitted to
1. Enforce All Illinois Insurance Statutes 2. Examine an insurers financial records 3. Issue cease and desist orders
An applicant may be refused insurance coverage due to
1. Health 2. Age 3. Occupation
All of these must be included on an insurance producers license
1. Name of producer 2. Producer ID number 3. Date of issue
All of these are unfair trade practices
1. Rebating 2. Discrimination 3. Twisting
All of these statements concerning a licensee's responsibility for premiums received are true
1. The licensee may not commingle premiums with personal funds 2. The licensee shall hold them in a fiduciary capacity 3. The licensee must remit them to the insurance company within a specificed time
It is NOT acceptable to discriminate the amount of benefits for life and health insurance policies between individuals of
1. The same country of origin 2. Different religious faiths 3. The same racial category
A new life insurance policy owner may review and return it for a full refund within __ days after policy delivery
10 days
The total amount of premiums that a producer writes on a controlled business may not exceed the total amount written on all other business within a __ month period
12 month
A lapsed producer's license may be reinstated without having to pass a written exam if the license lapses within _______ months after the renewal fee due date
12 months However, a penalty in the amount of double the unpaid renewal fee shall be required after the due date
T the producer has collected premium monies from a client. T may personally hold these funds for a maximum of __ Days before depositing them in a Premium Fund Trust Account
14 days Any funds from applicants or policy owners that will be held for 15 days or longer by the producer must be deposited in a Premium Fund Trust Account (PFTA)
What is the minimum age for an individual to be a licensed Illinois Insurance producer
18
How many days is a temporary producers license valid
180 days Issued by the director
Every _ year(s), a producer must complete 24 hours of continuing education
2 years In order to keep license in good standing
A producer must complete _ hours of ethics per continuing education reporting period
3 hours To renew a producer license, a producer must complete 24 hours of continuing education courses every 2 years, with 3 of those hours being on the subject of ethics.
Producer must report felony convictions to the director within __ days after the entry date of the judgment
30 days
The holder of a business entity registration is required to notify the director within __ days of a change in office location
30 days
Within how many days must a licensee notify the director of a change in address
30 days
According to Illinois insurance law, life insurance claim payments made after __ days from receipt of satisfactory proof of loss must receive the insurers current interest rate
31 days If settlement of a claim is not reached within 31 days of receipt of satisfactory proof of death, the insurer shall pay interest on the claim at the rate no less than that paid on proceeds left on deposit with the insurer, computed from the date of death.
Producers must keep record of service fees charged or received for a period of _ years
7 years
All of the following are examples of insurance advertisements except
A memo from an employer announcing the availability of coverage for employees
A producer is attempting to replace an existing life insurance policy with a new one. What must this producer submit as part of the application?
A signed statement by the applicant regarding the replacement
Which of these is a requirement for obtaining a nonresident insurance producer license
A similar license must be held by the producer in his/her state of residence
Which of the following is a requirement to attain a nonresident producer license
Be licensed as a producer in the producer's state of domicile
Q the producer knowingly misappropriated fiduciary money in the amount of $150. This is his second offense. Q will likely be charged with a
Class 4 felony If a producer producer knowingly misappropriates or converts fiduciary moneys in the amount of $150 or less, they are guilty of a class A misdemeanor. Repeated occurrences of such actions are subsequently rated a class 4 felony.
Which of the following is considered a producers fiduciary responsibility
Collect premiums and remit to the insurance company as soon as reasonably possible
Which of these actions does not constitute life insurance policy replacement
Convert term coverage to a whole life policy
Illinois' 10-day free look period for life insurance policies begin at the
Date of delivery
A business entity wishes to become approved as a producer for soliciting insurance business. Before doing so, the business entity is required to submit to the director a(n)
Designated producer assigned for compliance with Illinois insurance laws
It is acceptable to discriminate the amount of benefits for life and health insurance policies between individuals of
Different classes (they will be able to afford different benefits)
The guaranty fund
Ensures that claims filed against insolvent insurance companies will be paid
How is the Illinois life and health insurance guaranty associated funded
From member companies
The director
Has authority to review policy forms if they will be issued for delivery in Illinois
An entity that acts as an insurance producer
Has the same bond requirements as an individual producer
Which of the following types of insurance may a limited lines producer sell
Industrial life insurance Industrial (home service) insurance is a policy priced well below it's counterparts and is sold by producers who sell it door to door. It is popular among low- to middle income buyers
Which of these accounts are producer license fees deposited into
Insurance producer administrative Fund All licensing fees collected by the director are paid into a special fund in the state treasury known as the Insurance producer administration Fund
Which licensee faces possible license revocation by the Director
Licensee who commingles monies belonging to policyholders with personal funds
A(n) _______ lines producer may sell travel accident insurance in Illinois
Limited
The director of insurance is authorized to
Make reasonable insurance rules and regulations
An Illinois producer must do which of the following to continue as a residential licensee
Meet continuing education requirements 24 hours of continuing education every 2 years with 3 of those hours being in the subject of ethics
A producer is circulating incorrect information about the benefits of a policy. This producer may be found guilty of
Misrepresentation
During the course of an insurance transaction, if a producer makes a false or incomplete statement, he/she could be found guilty of
Misrepresentation
Which Unfair Trade Practice involves making a false statement on an insurance application in order to receive money from an insurer?
Misrepresentation
An example of unfair claims practice would be
Misrepresenting insurance policy provisions affecting a loss
When a producer submits an insurance application, the application is required to contain the producers
Name and signature
In the event of a replacement, what must be given to the insurance applicant at the time of application
Notice Regarding Replacment
What must be signed by both the producer and applicant when an existing life insurance policy is being reissued with a reduction in cash value
Notice regarding replacement
Which of these contracts are affected by replacement regulations
Ordinary life insurance
An accelerated (living) benefit is payable based upon the occurrence of a qualifying event. This qualifying event is certified by a(n)
Physician
In Illinois, which of the following must be delivered to a policyowner upon the sale of an individual life insurance policy
Policy summary and buyers guide
A producer charged an insurance applicant an administration fee. At what point must the producer give a written disclosure for this fee
Prior to any services being rendered
Who signs a "notice regarding replacement" form when an application is taken for a new life insurance policy that replaces an existing one
Producer and applicant A copy must also be left with the applicant
Which of the following actions by a producer would not result in a license suspension or revocation
Producer representing a foreign insurance company
Which of the following is not a valid reason for the director to suspend or revoke a producers license
Producer represents more than one insurance company
Which of the following actions by a producer would not result in a license suspension or revocation
Producer sells a replacement policy that causes an insured to lapse an existing policy
Which of the following triggers an accelerated (living) benefit
Qualifying event Such as terminal illness or needing long-term care
An applicant may not be refused insurance coverage due to
Race
Q the producer has recently replaced one insurance policy with another. In Illinois, replacement is
Regualted and requires full disclosure
All of these are unfair trade practices except
Reinsurance
The act of replacing an existing insurance policy with another is called
Replacement
The director is NOT permitted to
Set insurance rates within the state
Life insurance replacement regulation protects the interests of
The Policyowner Since it's usually not in their best interest to replace existing coverage
All of these statements concerning a licensee's responsibility for premiums received are true except
The licensee must hold them in a separate account before transmitting them to the insurance company
Why would the director issue a temporary license
To allow the personal representative of a deceased producer to provide service to existing policyowners
An individual received a quote from an insurance company that is a different rate from individuals in the same risk class. The insurance company may be accused of
Unfair discrimination
Which Unfair Trade Practice involves making false statements about the financial condition of another insurance company
defamation
Replacement can be defined as
exchanging an existing policy for a new policy
An example of unfair claims practice would be
failing to effectuate prompt, fair, and equitable settlements of a claim
A hearing must be held before a producer's license can be suspended or revoked. Prior to the hearing, the Director of Insurance is required to
give written notice to the producer
During the course of an insurance business transaction, who does the producer legally represent
insurance company
A license may be denied, suspended, or revoked if the licensee
is found guilty of misrepresentation
An example of rebating would be
offering a client something of value not stated in the contract in exchange for their business
An example of unfair discrimination would be
offering different terms of coverage for different policyowners having the same risk classification
An individual who has a contract with an insurance company to represent it is called a(n)
producer
A producer has influenced an existing policyowner to convert an existing whole life policy to Reduced Paid-up insurance. The producer then sells the policyowner a new universal life policy. This transaction is called a(n):
replacement
An insurance producer could be found guilty of rebating by
sharing commissions with a client who has purchased insurance
Who negotiates viatical settlements between a policyowner and a viatical settlement provider
viatical settlement broker
In a viatical settlement, how much does the policyowner receive for a life insurance policy
Amount less than the death benefit
Which of these statements accurately reflects Illinois law regarding life insurance advertisements
An insurance agency is responsible for advertisements placed by it's insurance producers
All of these must be included on an insurance producers license except
Appointing insurance company