NC State - Property and Casaulty
Which of the following statements is NOT true regarding the Consumer Division? A A receipt for an insurance premium must be dated and signed by the agent B An agent may not buy salvage from a claimant C An agent charging a service fee must display that fee in their office D Commingling is prohibited
A receipt for an insurance premium must be dated and signed by the agent A premium receipt must be dated, state the name and address of the agency, agent, broker, or limited representative, state the name of the insurer and be signed by the person accepting the payment.
An insurance professional who represents the insured is a: A Insurance producer B Broker C Agent D Limited representative
Broker An insurance broker is a person who places insurance with an authorized insurer that has not appointed the person, and is deemed to represent an insured.
Which of the following is NOT prohibited from disclosing personal information about a client under the Insurance Information and Privacy Protection Act of North Carolina? A Insurer B Agency support personnel C Agent D Client
Client No insurers, agents, or agency support personnel may disclose any personal information about a client in connection with an insurance transaction, without having the client's written authorization before the disclosure occurs. The client owns their information and is free to disclose it.
An adjuster is a person who investigates all of the following types of insurance claims, except: A Health B Casualty C Property D Life
Life An adjuster is a person who investigates health, property, or casualty insurance claims.
Which of the following is NOT correct about unauthorized insurers? A The insurer is subject to North Carolina insurance laws B The insurer does not have a certificate of authority C The insurer might be licensed in a foreign jurisdiction D Business is considered to be contrary to public welfare
The insurer is subject to North Carolina insurance laws Unauthorized insurers are not subject to North Carolina insurance laws, which are designed to protect the insurance consuming public.
Agent B obtains a license to sell property and casualty insurance in North Carolina. In order to act as an agent for an insurer, what does Agent B need from the insurer? A A license B An authorization C An appointment D An approval
An appointment To act as an agent in North Carolina, a person must obtain a license for the kinds of insurance for which the person intends to act as an agent and, if acting for an insurer, an appointment from the insurer.
An insurer must provide claim forms to a claimant within _____ days of receiving notice of loss. A 45 B 30 C 20 D 15
15 An insurer must provide proof of loss forms to a claimant within 15 days of receiving notice of loss. If the insurer fails to do so, the insured may submit written proof of the occurrence, character, and extent of loss to fulfill the policy's requirements.
A temporary license may be issued to an individual for up to how long? A 365 days B 30 days C 180 days D 90 days
180 days The Commissioner may issue a temporary license, without regard to education, experience, or exam requirements, for up to 180 days.
Each property agent licensee must obtain how many insurance continuing education credits during each biennial compliance period? A 20 B 24 C 12 D 15
24 24 credit hours are required, including 3 credits obtained by completing an ethics course, and 3 credits on flood insurance and the National Flood Insurance Program.
When renewing a policy issued in North Carolina, a privacy information notice does not need to be provided to the insured if a notice meeting the requirements was provided within the previous ______ months. A 36 B 24 C 6 D 12
24 No notice is required if a privacy information notice has been provided to the insured within the previous 24 months.
What are the minimum policy limits that the Facility will cover a risk ceded by a member insurer? A 15/30/5 B 30/60/25 C 50/100/25 D 25/50/10
30/60/25 The Facility provides 100% reinsurance for 30/60/25, or $30,000 for bodily injury per person, $60,000 for bodily injury for 2 or more persons in any one accident, $25,000 for property damage per accident, and $1,000 for medical payments per person, except motorcycles and mopeds.
Following a complaint's final disposition, each insurer or its agents in North Carolina must maintain a record of all written complaints for at least how many years? A 3 B 2 C 4 D 5
5 Each insurer or its agents must maintain a record of all written complaints for at least 5 years after the complaint's final disposition or, for domestic companies, until the Commissioner adopts a final report of a general examination that contains a review of these records, whichever is later.
Property policies in North Carolina may be issued for a term up to: A 10 years B 7 years C 1 year D 3 years
7 years Property insurers are prohibited from issuing policies with a term longer than 7 years.
Agent R holds a North Carolina nonresident insurance license when they move to North Carolina. To continue being licensed, R must apply for resident licensure within: A 180 days of establishing legal residence B 270 days of establishing legal residence C 120 days of establishing legal residence D 90 days of establishing legal residence
90 days of establishing legal residence If a nonresident licensee moves to North Carolina and wants licensure in this state, they must apply for resident licensure within 90 days of establishing legal residence.
For the SDIP's point system, the Bureau must obtain records of convictions for moving traffic violations from the DMV at least how frequently? A Every 6 months B Every 2 years C Every 3 years D Every year
Every year Records of conviction of moving traffic violations must be obtained at least annually and applied to the Bureau's member companies.
The Insurance Guaranty Association provides coverage under which of the following circumstances? A Insurance company guarantees renewal of property and casualty policies B Applicant has been rejected by at least 2 property insurers C Insurance company is insolvent D Applicant for insurance is ineligible due to claim history
Insurance company is insolvent The Insurance Guaranty Association provides a mechanism for the payment of covered claims to avoid financial loss to claimants or policyholders because of the insolvency of an insurer.
The maximum limits of insurance for policies ceded to the Facility include all of the following, except: A $1 million Uninsured Motorist coverage per person and per accident B $100,000 bodily injury coverage per person C $2,000 medical payments coverage per person D $1,000 physical damage coverage
$1,000 physical damage coverage Physical damage coverage is not provided by the Facility. Though the base reinsurance limits are 30/60/25 with $1,000 for medical payments, the Facility may allow additional ceding privileges up to 100/300/50 limits, as well as up to $2,000 for medical payments per person. Uninsured Motorist and Underinsured Motorist coverages may not exceed $1 million.
An agent who has adverse administrative action taken against them in another jurisdiction must report the adverse action to the Commissioner within how many days after the final disposition? A 180 days B 90 days C 30 days D 15 days
30 days The report made within 30 days after the final disposition of the matter must include a copy of the order, consent order, and any other relevant legal documents. If an agent is being criminally prosecuted, a report must be filed within 30 days of the initial pretrial hearing date, and convictions must be reported within 10 days of the conviction.
The North Carolina Rate Bureau assesses and recommends rates for property and casualty insurance against loss to residential contents and real property with not more than ___ housing units. A 6 B 4 C 8 D 10
4 The North Carolina Rate Bureau assesses and recommends rates for property and casualty insurance against loss to residential contents and real property with not more than 4 housing units. The Bureau also assesses and recommends rates for theft, physical damage, and liability coverage for nonfleet private passenger motor vehicles, and coverage under Workers' Compensation and Employers Liability insurance.
The Commissioner has the power to do all of the following, except: A Cause someone to be arrested if there is evidence to charge them with a criminal violation B Inspect records, as provided by the producer of record C Issue a restraining order to stop law violations, but only if criminal charges are filed D Require a licensee to notify the Commissioner of an address change within 10 days of the change
Issue a restraining order to stop law violations, but only if criminal charges are filed The Commissioner must apply to the appropriate court, and the court will issue a restraining order requiring that any violation cease and desist, even if criminal charges have not been filed. If there is evidence to charge a person with a criminal violation, the Commissioner may arrest with a warrant or cause the person to be arrested.
A rate currently being used by a member insurer of the North Carolina Rate Bureau is deemed by the Commissioner to be excessive, and the Commissioner orders the rate to be discontinued. After this order, the member insurer must: A Discontinue use of the rate and apply for judicial review B Place in escrow the amount that is potentially excessive C Request a hearing within 45 days, during which the insurer may continue use of the rate D Immediately cease using the rate and return excess premium to all affected policyholders
Place in escrow the amount that is potentially excessive The Commissioner's order will automatically be subject to judicial review without a request for a review. During the interim period pending judicial review, the insurer must place in escrow the premium amount that is potentially excessive until the court reaches a final determination. The funds will be distributed appropriately, to policyholders if the rate is excessive or to the Bureau if it is not excessive.
Offering a premium discount not specifically included in the policy is called: A Misrepresentation B Rebating C False information D Twisting
Rebating Rebating is offering any rebate, discount of premium, advantage, or valuable consideration not specified in the policy, but does not include a bonus, reduction in premium for mailing premium, and readjusting group rates based on claims experience.
In North Carolina, a violation of the Privacy Protection Act is punishable by all of the following, except: A $100,000 fine B Up to $10,000 per violation C License suspension D License revocation
$100,000 fine A fine up to $50,000 may be imposed if multiple violations occur with such frequency that it is considered a general business practice.
C is at fault in a major car accident and is subject to a $100 surcharge on C's auto policy. C is then convicted of a traffic violation related to the accident, which is subject to a $75 surcharge. What surcharge is assessed on C's policy? A $100 B $175 C $150 D $75
100 If an insured is at fault in an accident and is then convicted of a moving traffic violation in connection to the accident, only the higher premium surcharge between the accident and conviction may be assessed on the policy.
An insurer in North Carolina must provide proof of loss forms to a claimant within _____ days of receiving notice of loss. A 30 B 15 C 20 D 45
15 An insurer must provide proof of loss forms to a claimant within 15 days of receiving notice of loss. If the insurer fails to do so, the insured may submit written proof of the occurrence, character, and extent of loss to fulfill the policy's requirements.
According to North Carolina Rate Bureau guidelines, an insurer must give the insured at least ________ advance written notice whenever the insurer changes the premium rate. A 72 hours B 15 days C 30 days D 7 days
15 days When an insurer changes the coverage, other than at the request of the insured, or changes the premium rate, it must give the insured at least 15 days advance written notice of such coverage change or premium rate change, but this does not apply to Workers' Compensation insurance and Employers Liability insurance.
The North Carolina Motor Vehicle Reinsurance Facility defines a clean risk as any private passenger vehicle owner when the owner and all licensed operators in the household have: A 2 years of licensed driving experience and no SDIP points during the experience period B 2 years of licensed driving experience and no more than 3 SDIP points during the experience period C 3 years of licensed driving experience and no more than 1 SDIP point during the experience period D 3 years of licensed driving experience and no SDIP points during the experience period
2 years of licensed driving experience and no SDIP points during the experience period
How much time does an insurer have to notify the Commissioner after an agent's appointment is terminated? A The insurer is not required to notify the Commissioner B 15 days C 30 days D 60 days
30 days An insurer that terminates a producer's appointment must notify the Commissioner within 30 days after the termination's effective date. The notice must state the cause for termination if the cause is also ground for license suspension, probation, revocation, or nonrenewal. Insurers must give a copy of the notice to the producer within 15 days of notifying the Commissioner.
If the Commisioner finds that a filed rate does not comply with requirements, the Commissioner must notify the Bureau of the disapproval within how many days after the rate was filed? A 60 days B 90 days C 50 days D 30 days
50 days If a rate filed by the Bureau does not meet requirements, notice of disapproval must be sent to the Bureau within 50 days after the rate was filed, including an explanation of why it was disapproved. If a rate is later ordered to be no longer effective by the Commissioner because it is unfairly discriminatory or excessive, the order will be subject to judicial review.
According to North Carolina regulations, an insured who obtains surplus lines insurance is subject to: A A 2% premium tax B A 5% premium tax C A $5,000 fine for the first offense D A $10,000 fine per violation for the second and subsequent offenses
A 5% premium tax Surplus lines insurance from nonadmitted insurers is allowed when coverage cannot be obtained through the open market from admitted insurers, but the insured is subject to a 5% tax of gross premiums, payable to the Commissioner. The insured must also submit a report to the Commissioner containing information regarding the surplus lines coverage, filed within 30 days after obtaining or renewing the policy. The fines apply to violations of North Carolina's rules prohibiting business by unauthorized insurers.
The right to sue a person to recover property is called: A Voir dire B Common law C A chose in action D Litigation
A chose in action A chose in action is the right to sue a person to recover property, money, goods, or debts. This is relevant to North Carolina's laws regarding false pretenses and cheats, which makes it a felony to use false pretense to obtain or attempt to obtain any money, property, chose in action, or other thing of value from another person.
The North Carolina Motor Vehicle Reinsurance Facility provides automobile insurance to each of the following, except: A A person whose vehicle has been principally garaged in North Carolina for at least 6 months B Military personnel stationed in North Carolina who intend to return to their home state C A person who is unable to obtain insurance in the regular market D A farmer who wants to insure farm equipment
A farmer who wants to insure farm equipment The Facility will insure motor vehicles, which are self-propelled vehicles designed for use on a highway, including motorcycles, but not farm or construction equipment.
The Post-Assessment Insurance Guaranty Association provides a mechanism to do all of the following for the payment of covered claims under certain insurance policies, except: A Avoid financial loss to claimants or policyholders because of the insolvency of an insurer B Assess the cost of such protection among insureds C Avoid excessive delay in payment D Assist in the detection and prevention of insurer insolvencies
Assess the cost of such protection among insureds The Post-Assessment Insurance Guaranty Association provides a mechanism for the payment of covered claims under certain insurance policies to provide an association that protects insureds in the event of insurer insolvency. The Association will assess the cost of such protection among insurers, not insureds.
All of the following are duties of the Commissioner of Insurance of North Carolina, except: A Conducting examinations, investigations, and hearings as necessary to administer state insurance laws B Administering oaths C Creating insurance laws to protect the public D Issuing, refusing, suspending, or revoking certificates of authority to insurers and licenses to insurance agents
Creating insurance laws to protect the public While the Commissioner of Insurance can establish rules and regulations necessary to fulfill North Carolina insurance laws, they cannot make insurance laws, which is the responsibility of the state legislature.
The Safe Driver Incentive Plan distinguishes safe drivers from drivers with driving records containing each of the following, except: A At-fault accidents B Excessive collision claims C Minor moving traffic violations D Major moving traffic violations
Excessive collision claims Safe Driver Incentive Plans adequately and factually distinguish among various classes of drivers that have safe driving records and various classes of drivers that have a record of major traffic violation, minor traffic violations, at-fault accidents, or a combination, but not a history of collision claims.
Which one of the following actions would result in a misdemeanor charge? A For an agent to sign a blank contract B For an agent or broker to knowingly use honest representations to transact insurance business C To make a true statement to get a commission or benefit from an insurer D To willfully make a true statement on an insurance application
For an agent to sign a blank contract It is a misdemeanor for an agent or limited representative to sign a blank contract.
If a licensee fails to complete continuing education requirements, they are subject to all of the following, except: A They may reinstate their license within 4 months after the end of the compliance year B If the license is not reinstated within 4 months, the licensee is only required to pass the licensing examination to reinstate it C The license may be reinstated by meeting CE requirements and paying an administrative fee D Their license will lapse
If the license is not reinstated within 4 months, the licensee is only required to pass the licensing examination to reinstate it Licensees whose license has lapsed due to incomplete CE requirements may reinstate their license within 4 months by completing CE requirements and paying an administrative fee. After those 4 months, licensees must complete both the prelicensing education requirement and the licensing exam requirement.
North Carolina insurance statutes require insurance professionals to do all of the following, except: A Refuse gratuity for recommending a repair service provider B Obtain separate written consent for each service fee charged to applicants C Keep accounting records separate and apart from other business records D Inform customers orally of any service fees charged
Inform customers orally of any service fees charged If an agent, broker, or limited representative charges a service fee, they must display a notice about the fee in their place of business. They must also obtain separate written consent from the applicant for each service fee and provide a receipt.
The North Carolina Rate Bureau assesses and recommends rates for all of the following insurance coverages, except: A Property and casualty insurance for residential property and its contents B Inland Marine C Physical damage and liability coverage for nonfleet private passenger motor vehicles D Workers' Compensation and Employers Liability insurance
Inland Marine The purpose of the Bureau is to assess and recommend rates for residential property and its contents, nonfleet private passenger motor vehicles, and Workers' Compensation and Employers Liability insurance. The Bureau does not do the same for Inland Marine coverages.
All of the following insurers would be allowed to conduct insurance business in North Carolina, except: A Insurer ABC is certified, but not admitted B Insurer JKL legally provides coverage for risks not located in the state at the time of policy issuance C Insurer GHI is a surplus lines insurer providing coverage that cannot be obtained through the open market from admitted insurers D Insurer DEF provides coverage for a nuclear electric generating plant
Insurer ABC is certified, but not admitted Unauthorized insurers are prohibited from conducting business in North Carolina. Insurers must be certified and admitted by the Commissioner, or qualify under an exception, such as providing coverage for a nuclear electric generating plant, covering subjects of insurance not located in the state at the time of issuance, or being a surplus lines insurer. Reinsurance and marine, aircraft, or liability insurance are also excepted from this rule.
If an insurer deems a Workers' Compensation risk to be too difficult to place in the voluntary market, the North Carolina Rate Bureau will: A The Bureau will not insure the Workers' Compensation risks that cannot find coverage in voluntary market B Bind coverage for 90 days or until the employer finds coverage in the voluntary market, whichever is the shorter period C Issue a binder for 30 days until the Bureau can designate a member insurer to insure the risk as part of the Bureau's duty as a risk-sharing plan D Instruct the employer to self-insure to meet North Carolina's requirements for Workers' Compensation insurance
Issue a binder for 30 days until the Bureau can designate a member insurer to insure the risk as part of the Bureau's duty as a risk-sharing plan The Bureau acts as a risk-sharing plan for risks that are too difficult to place in the voluntary market, including Workers' Compensation risks. If a Workers' Compensation risk is too difficult to place, the Bureau will bind the risk for 30 days once the deposit premium is paid, and will then assign the risk to one of the member insurers.
An insurer may deviate from the Bureau's rates only if the insurer does all of the following, except: A File the proposed deviation with the Bureau and the Commissioner B Obtains the insured's consent if the rate is lower than the Bureau-approved rate C Get approval for the deviation by the Commissioner D Base the deviation on sound actuarial principles
Obtains the insured's consent if the rate is lower than the Bureau-approved rate All deviations must be filed with the Bureau and Commissioner, get Commissioner approval, and be based on sound actuarial principles. Only rates higher than the approved rate require the insured to sign a consent to rate form.
When the North Carolina Motor Vehicle Reinsurance Facility rates its policies, all of the following statements are correct, except: A The Facility rating classifications and policy forms must be filed with the Commissioner B Rates for clean risks must not exceed rates for clean risks not reinsured by the Facility C Rates must be developed to produce a profit D Each member insurer must provide actuarial information to the Facility
Rates must be developed to produce a profit All rates must be on an actuarially sound basis and be calculated to produce neither a profit nor a loss.
The North Carolina Rate Bureau is intended to do which of the following? A Recommend rates for physical damage and liability coverages for private passenger motor vehicles B Protect consumers against insurer insolvency C Insure low-risk property in order for the voluntary market to insure high-risk property D Deregulate Workers' Compensation and Employers Liability insurance in the state
Recommend rates for physical damage and liability coverages for private passenger motor vehicles The North Carolina Rate Bureau assesses and recommends rates for physical damage and liability coverage for nonfleet private passenger vehicles, Workers' Compensation and Employers Liability insurance, and insurance on residential property and its contents. The Bureau also holds hearings for grievances and acts as a risk-sharing plan to insure uninsurable or high-risk persons or property.
The Commissioner may revoke an agent's license for all of the following reasons, except: A Making a material misstatement on a licensing application B Failing to pay court-ordered child support C Reporting a crime from another jurisdiction to the Commissioner D Mishandling funds received while transaction insurance business
Reporting a crime from another jurisdiction to the Commissioner If an agent is prosecuted for a crime in any jurisdiction, they are required to report it to the Commissioner within 30 days after the initial court appearance, and if the agent is subsequently convicted, they must deliver notice within 10 days of the conviction. The other answer options are grounds for license revocation.
All of the following are general duties of the Commissioner, except: A Issuing licenses to insurance agents B Selling contracts of insurance C Reporting any violation of insurance law to the attorney general D Administering and enforcing insurance laws and rules
Selling contracts of insurance The Commissioner does not sell insurance. The Commissioner administers and enforces the state's insurance laws, including issuing licenses to agents and reporting violations of the law to the attorney general.
Which of the following statements regarding the North Carolina Insurance Guaranty Association is false? A In general, the Association is obligated to pay covered claims of more than $50 and less than $300,000 B The Association will not pay any amount exceeding the insolvent insurer's obligation C The Association is a for-profit corporate entity D Any person or insurer that writes any kind of insurance applicable to the Association must be a member of the Association
The Association is a for-profit corporate entity The North Carolina Post-Assessment Insurance Guaranty Association is a nonprofit, unincorporated entity.
Nonresidents may be eligible for coverage through the North Carolina Motor Vehicle Reinsurance Facility if: A The nonresident is a full-time student attending a university in Kansas, with plans to stay outside of North Carolina after completing the program B The nonresident is in the military, is stationed outside of this state, and does not intend to return to North Carolina C The nonresidents owns a motor vehicle registered in North Carolina that is principally garaged in another state D The nonresident owns a motor vehicle registered in North Carolina and garaged in the state for at least 6 months during the current or preceding year
The nonresident owns a motor vehicle registered in North Carolina and garaged in the state for at least 6 months during the current or preceding year Nonresidents may be eligible for coverage through the Facility if they own a vehicle registered in North Carolina and principally garaged in the state, meaning it has been garaged in the state for at least 6 months during the current or preceding year.
It would be considered twisting for an insurer to: A Refuse to approve a loan unless the applicant buys insurance from an affiliated insurer B Discriminate between individuals of the same class in the amount of premium charged or benefits paid C Accept premiums by credit card but charge a fee for the service D Willfully misrepresent or incompletely compare the terms of an insurance policy to induce the policyholder to replace it
Willfully misrepresent or incompletely compare the terms of an insurance policy to induce the policyholder to replace it Twisting is giving prospects misleading information or comparisons about an insurance policy in order to sell them a replacement policy. The other choices describe prohibited practices, but they are not examples of twisting.
If a licensee changes their residential or email address, they must notify the Commissioner in writing within how many days? A 15 B 30 C 20 D 10
10 A licensee must notify the Commissioner in writing within 10 days of a change in residential or email address or of being convicted of a crime other than an auto misdemeanor.
All of the following are general regulations for insurance policies issued in North Carolina, except: A A lender may not require a customer to buy insurance from an affiliated insurer in order to get a loan B Policies with a coinsurance provision must label the policy as a Coinsurance Contract on the Declarations page C If premiums are paid by credit card, no service charge may be added to the insured for the service D A home loan provider may not accept a binder as evidence of insurance
A home loan provider may not accept a binder as evidence of insurance A home loan provider must accept a binder or other temporary written contract of insurance as evidence of insurance, as long as it includes specified identifying information and a provision that the binder may not be cancelled without 10 days' written notice to the mortgagee.
Which of the following actions would NOT result in a misdemeanor penalty in North Carolina? A An agent willfully makes a false statement on an insurance application B An unlicensed person acts as an agent C An insurance agency employee embezzles $500 from the agency D An agent signed a blank contract
An insurance agency employee embezzles $500 from the agency Any embezzlement is a felony: Class H if under $100,000, and Class C if $100,000 or more. The other actions would result in a misdemeanor.
All of the following statements regarding SDIP surcharges are correct, except: A SDIP points must be equal to the severity of the claimant's injury B A major accident is an at-fault accident resulting in bodily injury, death, or property damage of at least $3,850 C A person with less than 3 years driving experience may not be surcharged D A subclassification plan surcharge must be applied to a policy for 3 policy years
A person with less than 3 years driving experience may not be surcharged An insurer may provide for premium surcharges for insureds having less than 3 years' driving experience as licensed drivers.
Which of the following statements is correct regarding general business regulations for property insurance issued in North Carolina? A Policy credits are not available for policy forms providing functional replacement cost coverage B A premium overpaid for a sum in excess of a building's actual cash value must be reimbursed at 6% annual interest from the date of issue C A property policy may not be insured for a term exceeding 8 years D A policy covering fire damage will cover a loss for actual cash value if ACV has been added to the policy by an endorsement
A premium overpaid for a sum in excess of a building's actual cash value must be reimbursed at 6% annual interest from the date of issue A property policy pays actual cash value at the time of a total loss, and if the premium for the policy exceeds the actual cash value of the building, the insured is entitled to a reimbursement for the difference back to the inception of the policy, plus 6% annual interest.
Agent U sells an insurance policy on behalf of an unauthorized insurer, despite knowing that the insurer is unauthorized in North Carolina. When the policyholder submits a claim, the insurer only pays for a portion of it. Agent U is subject to all of the following consequences, except: A Knowingly placing insurance with an unauthorized insurer is a Class H felony B Agent U is jointly liable with the unauthorized insurer to pay the remainder of the claim C License suspension, probation, revocation, or nonrenewal D Agent U is liable for the unpaid portion of the claim
Agent U is jointly liable with the unauthorized insurer to pay the remainder of the claim Anyone who transacts insurance for an unauthorized insurer is strictly liable for any unpaid claim. Knowingly placing insurance with an unauthorized insurer is a Class H felony, and unknowingly doing so is a Class 1 misdemeanor, with both instances making the agent subject to license suspension, probation, revocation, or nonrenewal.
Which of the following individuals does not require an insurance agent's license in North Carolina? A An individual wishing to represent purchasers of insurance B An individual who has earned the Chartered Life Underwriter (CLU) designation C An agency clerk who maintains records for agents D An individual licensed in Virginia wishing to sell insurance in Winston-Salem
An agency clerk who maintains records for agents Administrative, managerial, or clerical employees of insurance producers do not require an agent license as long as they do not receive commissions from policies written or sold in the state. An individual licensed in another state is required to get a nonresident license before selling insurance in North Carolina. An individual representing purchasers requires a broker's license.
Which of the following is NOT a duty required of the Commissioner of Insurance? A Approve or disapprove insurance rates, forms, and safe driver incentive plans B Conduct examinations and investigations C Compile a list of rates charged by insurers for residential property D Establish laws, rules, and regulations regarding North Carolina insurance
Establish laws, rules, and regulations regarding North Carolina insurance The Commissioner of Insurance administers rules and regulations necessary to fulfill North Carolina insurance laws. The Commissioner does not create or establish them.
Which of the following is an unfair claims settlement practice? A Thoroughly representing pertinent facts or insurance policy provisions relating to the coverage B Telling an insured the policy of appealing a claim's denial C Requiring the insured to cooperate with the investigation D Failing to promptly explain a claim's denial based on applicable provisions or laws
Failing to promptly explain a claim's denial based on applicable provisions or laws Failing to promptly explain the policy or legal basis for a claim's denial is an unfair claim settlement practice. Refusing to pay claims without conducting an investigation based upon all information, misrepresenting facts about insurance policy provisions, and informing insureds of a policy to appeal arbitration awards to compel them to accept settlements for less than the amount awarded in arbitration are also unfair claim settlement practices.
The Commissioner of Insurance may suspend, place on probation, revoke, or refuse to renew a license for all of the following reasons, except: A Knowingly accepting business from an appropriately licensed broker B Committing dishonest or fraudulent practices in the insurance business C Cheating on an insurance exam D Forging another's name on an insurance document
Knowingly accepting business from an appropriately licensed broker Knowingly accepting business from an unlicensed or inappropriately licensed broker would be a reason the Commissioner of Insurance may suspend, place on probation, revoke, or refuse to renew a license.
When the Bureau or the Commissioner modifies insurance rates for private passenger vehicles, all of the following factors are taken into account, except: A Use of the vehicle B Number of claims C Vehicle characteristics D Insureds' years of driving experience
Number of claims Factors that inform rates set by the Bureau or the Commissioner include insureds' years of driving experience, vehicle characteristics, and use of the vehicle, without limitation to farm use, business use, and work commutes.
According to North Carolina's Insurance Information and Privacy Protection Act, an adverse underwriting decision for an individual insurance policy would include any of the following, except: A Terminating coverage on a specific policy B An agent declining to make an application with the specific insurer the applicant requested C Offering to insure at a rate that is higher than standard D Policy rescission
Policy rescission For individually written coverage, the rescission of a policy, termination of a policy on a statewide basis, or a declination of coverage because it is not available on a statewide basis are examples of decisions that are not adverse underwriting decisions.
All of the following are unfair claims settlement practices, except: A Making known to insureds or claimants a policy of appealing arbitration awards B Not attempting in good faith to promptly, fairly, and equitably settle a claim in which liability has become reasonably clear C Promptly explaining, based on applicable provisions or laws, a claim's denial D Compelling insureds to sue to recover amounts due by offering substantially less than the amounts typically recovered in actions brought by legal process
Promptly explaining, based on applicable provisions or laws, a claim's denial Failing to promptly explain, based on applicable provisions or laws, a claim's denial is an unfair claims settlement practice.
All of the following are reasons to terminate coverage issued by the Facility, except: A The named insured is a nonresident with the vehicle principally garaged in North Carolina B Nonpayment of premium C Termination of the insurer's contract with the agent who wrote the policy D The named insured is no longer an eligible risk
The named insured is a nonresident with the vehicle principally garaged in North Carolina Coverage through the Facility may be terminated if the named insured is an ineligible nonresident. A nonresident with a vehicle principally garaged in North Carolina is still eligible for coverage, so coverage may not be terminated on the basis of the insured's nonresident status.
