Unit 23- Health Insurance

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Defamation

false, maliciously critical, or derogatory communication that injures reputation

8 characteristics of an ethical insurance producer

honesty, integrity, loyalty, fairness, compassion, respect for others, personal responsibility, and accountability

Full disclosure

informing the prospect or client of all facts involving a specific policy or plan so that an informed decision can be made

Controlled business

insurance written in the licensee's own interests or the interests of his spouse or employer

An insurance producer who solicits insurance on behalf of an insurer represents the

insurer

Unfair Trade Practices Act

model act originally created by NAIC to deal with inappropriate use of advertising

A company that has not been authorized to operate in Colorado is known as

nonadmitted insurer

A company that has not been issued a certificate of authority is refereed to as a ____________ _____________

nonadmitted insurer

Twisting

persuading policyowner to drop policy for the sole purpose of selling another

The essence of an agency relationship is ___________

power

What does need selling involve?

problem analysis, action planning, product recommendation, and plan implementation

If a producer offers to refund part of a prospect's premium in exchange for the purchase of an insurance policy, the producer is committing the illegal act of

rebating

What did IMSA do?

watchdog for ethical principals

Misrepresentation

written or oral statement that does not accurately describe a policy's features, benefits, or coverage

What is the maximum amount the commissioner can fine an insurer for each violation of a cease and desist order?

$10,000

A fraternal benefit society representative need not be licensed as a producer if he sells life insurance with a face amount equal to or less than

$50,000

What is the aggregate penalty the commissioner may charge an insurer that has knowingly engaged in an unfair trade practice?

$750,000

To be licensed to sell life, and accident and health insurance in Colorado, an applicant must complete

100 hours of prelicensing education

How many hours of continuing education must be in courses associated with the lines of insurance for which the producer is licensed?

18

A producer has how many days to file a written appeal to the commissioner after he has been terminated by his appointing insurer?

30

An insurer that terminates a producer's appointment must inform the commissioner within how many days?

30

All of the following may result in license suspension or revocation EXCEPT A. making a factual but subjective comparison of two policies B. making a false statement in a license application C. intentionally violating a cease and desist order D. violating an insurance regulation

A

What does IMSA stand for?

Insurance Marketplace Standards Association

All of the following are duties of the commissioner EXCEPT A. keeping records of the insurers that he has examined B. writing insurance laws C. submitting an annual report to the general assembly D. adopting rules and regulations

B

In CO, all of the following are considered unfair trade practices EXCEPT A. misrepresentation B. rebating C. replacement D. coercion

C

What does NAIC stand for?

National Association of Insurance Commissioners

Is paying a claim without conducting an investigation considered an unfair claim settlement practice?

No

A fiduciary responsibility is defined as

a relationship of special trust and confidence when a person is entrusted with another's funds

What grants power between an insurer and producer?

agency contract

How must insurance producers account for each insurance policy and the premiums they receive on it?

as a separate account of the insured

The commissioner gives approval to an insurer to do business in Colorado in a certificate of

authority

A company that has a certificate of authority is referred to as an _______________ ____________

authorized insurer

Rebating

buyer receives part of commission or anything of value

Market conduct

combination of both ethics and compliance

The commissioner may...

conduct investigations and subpoena witnesses whenever he deems it necessary

Compliance

conducting business in accordance with current rules and laws set by government regulatory agencies and the courts

In general, people who represent fraternal benefit societies to solicit insurance are

considered insurance producers and must meet all licensing requirements

A producer who was to write a majority of his insurance business on the employees and officers of a restaurant owned by his wife is transacting

controlled business

Insurance agency

corporation, partnership, association, or other legal entity that transacts insurance business and must obtain a license

Circulation of a maliciously critical statement about an insurer's financial condition to damage the insurer's reputation or business is called

defamation

Ethics

standards of conduct and moral judgement

When an insurer terminates a producer's appointment, the insurer must notify

the commissioner and producer

When appropriate, the commissioner reports a violation of insurance law to

the district attorney


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