Life Insurance and Annuities - Policy Replacement and Cancellation

An insurer has been found guilty of a code violation regarding replacement. The insurer then repeats the violation. What will be the minimum penalty?

$30,000

What is the minimum free- look period for newly issued life insurance polices in this state?

10 days

All insurance policies and annuity contracts delivered to senior citizens in the State of California are subject to a cancellation period of at least

30 days

Any insurer who engages in the insurance business and violates the code with respect to insurance replacement shall on the first violation

Be fined a sum of 10,000

Which of the following is true regarding a policy with a face value less than 10,000?

If it's returned during the free look period, the agreement will be void.

Which of the following insureds have a right to cancel an individual life policy for a full refund within 30 days of policy delivery?

Insureds who are 60 years of age or older

During replacement of life insurance, a replacing insurer must do which of the following?

Obtain a list of all life insurance policies that will be replaced

An insured has the right to cancel a policy by written notification to the insurer. This notification may be mailed to the insurer or returned to the original agent who made the sale. Upon receipt of the cancellation request, the insurer will

Refund any premiums and policy fees within 30 days of notice if the policy is within the cancellation period specified by the insurer.

Which rule would apply if an agent knows an applicant is going to cash in an old policy and use the funds to purchase new insurance?

Replacement rule

How must a producer respond to an applicant wishing to replace existing life insurance?

The producer must provide the applicant with a Notice Regarding Replacement.

During the free-look period, the premium for a variable annuity may be invested in all of the following EXCEPT.

Value funds

An insured has the right to return the new insurance policy for a full refund during the

free look period