Insurance Test Final Chapter pt 2

Is it possible for a labor union to be a legitimate group sponsor?

Yes

Nonresidents

a nonresident agent that wishes to place coverage in MD will be granted a license if. 1) the nonresident is licensed in their home state 2) the non resident's home state grants nonresident applicants from maryland the same waver 3) the non resident has provided the commissioner with a copy of the license appliation from their home state, or a uniform application 4) The applicant pays the $54 licensing fee

Limited Liability Company

is a permitted form of an unincorporated business organization A business organization in which the business (not the owner) is liable for the company's debts

How many Pre-Licensing hours for a line of authority must be completed before an individual can take the licensing exam? 1) 3 hours 2) 60 hours 3) Pre-licensing is not a requirement 4) 20 hours

20 hours

If a temporary license is issued, it is valid for (?) months?

15 months

Corporation

A business entity that is formed according to state law. The organization is comprised of a board of directors and executive officers such as a president, Vice president, etc. Investors in the corporation receive proof of ownership in the form of shares. A business owned by stockholders who share in its profits but are not personally responsible for its debts

What is a fiduciary that handles funds in a trust capacity?

An agent

Examination

Any applicant granted a pre-licensing waiver, will have 6 months to successfully pass both the general and state licensing exams. To qualify for a certificate of qualification, an applicant must pass a closed book examination within 6 months after completing their pre-licensing education. the pre-licensing exam scores are only valid for 6 months.

When must the commissioner examine the affairs and transactions of each domestic insurer?

Every 5 years

Any type of deceptive advertising used in the state is described as which of the following? 1) misrepresentation 2) Churning 3) Twisting 4) rebating

Misrepresentation

What is an inducement used in the sale of insurance that is not specifically stated in the policy called? 1) Rebating 2) Marketing 3) commingling 4) defamation

Rebating

An insurance company's underwriters are responsible for making the decision regarding the (?) of an applicant based on their information 1) discrimination 2) Privacy 3) risk classification 4) behaviour

Risk Classification

business entities

1) Limited Liability Company 2) Partnership 3) corporation

Requirements for Insurance Advisor's license

1) be a member in food standing of the society of actuaries, the casualty actuarial society or the conference of actuaries in public practice 2) Hold a chartered property and casualty underwriter, chartered life underwriter, certified employee benefit specialist, or a certified financial planner designation 3) successfully complete a course of study equivalent to a course required for any of these societies of designations, and hold a certified insurance counselor designation. 4) as a determination of an applicant's trustworthiness and competency, all applicants must pass a written examination. A Surtey bond of $1000 must be posted by insurance advisors

Business entity qualifications

1) have at least 1 licensed individual working for them 2) Be licensed for the type of insurance they are selling 3) Be appointed by at lease one insurer

An insurance producer's license can be renewed for an additional (?) years

2 years

Bob, a producer violated an insurance regulation and the commissioner will conduct a hearing to review the circumstances of his violation. When will bob get a written notice regarding his hearing? 1) 15 days before hearing 2) 30 days before hearing 3) 10 days before hearing 4) 7 days before hearing

3) 10 days before hearing

Which of the following will most likely give advice about insurance coverage? 1) a business entity 2) an agent 3) an advisor 4) the commissioner

3) an advisor

The commissioner has many duties. Which of the following is not a duty for the commissioner? 1) establishing rules for producers 2) Revoking a producer's license due to a fraudulent act he/she performed 3) establishing rates 4) enforcing the insurance code

3) establishing rates

Which of the following does not relate to a charging document? 1) an indictment 2) a citation 3) statement of charges 4) a fine

A fine

Producers

A producer is anyone who performs activities of an insurance agent. These activities include selling, soliciting, and negotiating insurance contracts for compensation. Producers are required to obtain a Certificate of Qualification for the various types of insurance they intend to sell. They must be appointed by at least one authorized insurance company

License fee and application

An applicant must pay a license fee of $54, and submit a completed application to the commissioner

Advisors

Clients are given advice about insurance exposures, coverage, and insurance recommendations by insurance advisors. Insurance advisors must obtain a license.

Partnership

Exists when two or more people are engaged in a common enterprise A business in which two or more persons combine their assets and skills

What is it called when words are used to misrepresent the benefits of a policy? 1) commingling 2) rebating 3) discrimination 4) False Advertising

False Advertising

Viatical Settlement Broker

On behalf of a viator and for a feem commission, or other valuable consideration, offers or attempts to negotiate a biatical settlement. Viatical Settlement brokers must be licensed as a life insurance producer (agent), renew their license every other year by filing the appropriate application, and pay a fee to the commissioner. Arranges the agreement between the viatical settlement purchaser, provider, and viator. The broker works on behalf of the viator in this agreement

Insurance trade practices are regulated by the?

State

Temporary License

State law provides for the issuance of a Temporary producer's license in certain situations, without the applicant having to take an examination. The issuance of a temporary license will be granted if certain conditions are met.

Who does the commissioner inform and counsel on all matters relating insurance?

The Govenor

Tim, a producer, persuaded his client to switch to his policy that is truly not in his best interest. What is this called? 1) coercion 2) Twisting 3) Boycott 4) intimidation

Twisting

What act was adopted to make sure claims are handled fairly?

Unfair Claims Practices act

Three partners are going to open an insurance company. How many of them must be licensed? 1) at least 2 of them 2) none 3) all of them 4) at least one

one of them

Initial Licensing qualifications

the following requirements must be met for applicants to receive a certificate of qualification to act as an insurance provider 1) 18 years old 2) be trustworthy/of good character 3) meet the educational requirements and experience requirements for a producer 4) file an application with the commissioner 5) submit any other information required by the commissioner 6) Complete 20 pre-licensing course hours for each line of authority.

What is the maximum fine an agent may need to pay for violating the insurance laws? 1) $100,000 2) $1,000,000 3) $1,000 4) $50,000

$100,000

One of the requirements for receiving an insurance advisor's license is filing for a (?) bond

$1000

Licensing purpose

The state requires all people to be licensed to sell insurance products, so it has control over those selling insurance

Individuals not required to be licensed

1) officers, employees, producers (Agents) or other representatives of an authorized insurance company while they are acting for an insurance company. 2) producers acting on behalf of their clients 3) Attorneys acting within the course of their occupation 4) Licensed public adjusters acting within the scope of their license. 5) those selling travel, credit life or credit health

Temporary License conditons

1) upon the death of an agent, a surviving family member, legal representative, or employee may receive a temporary license. 2) If a producer is unable to perform their duties because of injury, disability, or mental incapacity, a temporary license may be granted to a surviving family member, legal representative, or employee. -- The representative must submit to the commissioner an appropriate application and the commissioner will, within 30 days, issue a temporary license or reject an application. the Temporary license will be valid for 15 months.

A licensed life insurance agent can perform all of the following except. 1) solicit life policies 2) negotiate P&C policies 3) Advertise life policies 4) sell life insurance

2) negotiate P&C policies

I worked at a firm for 15 years and I was dismissed last Friday, due to a reduction in sales. How long do I have to convert my group life insurance?

31 days

If producer John, renews his license before it expires, what would happen? 1) The term of his license would be extended 2) nothing would happen 3) There will be an additional administrative charge 4) A new license would be issued

4) A new license would be issued

Jill wants to take out a loan. As a condition, her banker stated she needed to buy credit insurance from a certain company to qualify for the loan. Jill's banker is guilty of which of the following? 1) defamation of character 2) misrepresentation 3) coercion 4) Intimidation

Coercion