Nevada Statutes and Codes Common to All Lines

When is controlled business legal?

When the commissions from controlled business do not exceed the aggregate commissions on all the other business (specific limits may vary from state to state)

When can the commissioner or Director examine insurers?

Whenever deemed necessary, but at least once every few years (please check your state regulations for specific time requirement)

What type of licensee represents the insurance company?

agent

If a producer makes maliciously critical statements about another insurer what is the illegal practice called?

defamation

Two individuals who are in the same risk and age class are charged different rates for their insurance policies due to an insignificant factor. What is this called?

discrimination

Insurers are classified according to their domicile. What are the three types of insures?

domestic, foreign, alien

What type of insurer is formed under the laws of another state?

foreign

Who is an insurance agent?

A person authorized to sell, solicit and negotiate insurance contracts

When would a misrepresentation on an insurance application be considered fraud?

When it is intentional and material

What are the most common penalties for violations of insurance statutes?

A cease and desist order, a fine, and license suspension or revocation

Who is considered a nonresident agent?

An agent who resides and is licensed in another state, but who is authorized to transact insurance in this state

If an insurer holds a certificate of authority, it is known as what type of insurer?

Authorized or admitted

If an insurer meets the states financial requirements and is approved to transact business in the state, it is considered what type of insurer?

Authorized or admitted

If the commissioner/superintendent finds a licensee engaging in an unfair method of competition or an unfair practice, what order will be issued?

Cease and desist order

What document is required for an insurance company to transact insurance?

Certificate of Authority

A state issued document, empowering an insurance company to become an admitted insure is called what?

Certificate of authority

What are producers required to do in order to renew their license?

Complete continuing education hours and pay a renewal fee

The requirement that agents must account for and promptly remit all insurance funds collected is known as what type of agent responsibility?

Fiduciary Reponsibility

In general who can be excluded from producer, licensing, and examination requirements?

Insurance company officers, directors, or any other employees who do not transact insurance and who do not receive commissions for their services (usually, their responsibilities include administrative, executive or clerical)

What is a controlled business?

Insurance on the producer's own life or property, or the lives or property of the producer's family or business associates

On its advertisement, a company claims that it has funds, in its possession that are in fact not available for the payment of losses or claims. What is the company guilty of?

Misrepresentation

What illegal act does a producer commit when the producer represents a policy in a more favorable light than the policy really is?

Misrepresentation

Who may share in the commission from the sale of an insurance policy?

Only producers properly licensed for the type of insurance transaction

An agent offers a client free tickets to a sporting event in exchange for the purchase of an insurance policy. What is the agent guilty of?

Rebating

Who must be notified of a producers change of address?

The Department of Insurance (Commissioner/Director/Superintendent)

Who is responsible for the cost associated with the examination of insurers?

The insurer who is being examined

To whom may certificate of authority be issued?

To an insurer authorized to transact business in this state

What is the purpose of a cease and desist order?

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

Who owns stock companies?

stockholders

Which type of misrepresentation, persuades an insured to their detriment to cancel, lapse, or switch policies from one to another?

twisting