Washington Laws and Rules Pertinent to Insurance

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The Commissioner of Insurance serves a term of ___ years.

4

To be classified as a small employer in Washington, an employer must employ

1-50 employees

If an accident and health (disability) policy is reinstated after it had lapsed for nonpayment, there is a waiting period of ___ days before a claim of covering sickness will be covered.

10

A disability policy where the premiums are due monthly require a grace period of

10 days

The free look period provided in a life insurance policy is usually

10 days

An individual insurance producer who allows his or her license to expire may, within ___ months from the expiration date, reinstate the same license without passing a written exam.

12

What is the MINIMUM benefit period that must be offered by a Long-Term Care policy?

12 months

An insurer must send a notice of appointment for a producer within ___ days from the date of an executed agency contract or after submitting the first application to the insurer.

15

A producer license applicant must be at least ___ years of age.

18

A temporary license is valid for a maximum of ___ days

180

After a disability policy has been in force for ___ year(s), it is considered incontestable.

2

A life insurance policy becomes incontestable after it has been in force for

2 years

Written notice of a health (disability) insurance claim should be given to the insurer within ___ days after the occurrence of any loss covered by the policy.

20

Producers must complete ___ hours of continuing education biannually.

24

In conjunction with a Washington insurance license renewal, which one of the following is the continuing education REQUIREMENT?

24 hours every 2 years

Carmen's individual life insurance policy has recently lapsed. She may reinstate her policy anytime within ___ year(s)

3

No legal action can be initiated after ___ years from the initial time written proof of loss has been provided.

3

The open enrollment period for Medicare and Medicare Supplements begins ____ months before an individual's 65th birthday.

3

Tim's individual life insurance policy has just recently lapsed. His policy may be reinstated at any time within ___ year(s)

3

Washington requires that a licensee completes ___ hour(s) of continuing education on the subject of ethics every reporting period.

3

Washington requires that an insurance producer must complete ___ hour(s) of continuing education on the subject of laws and ethics every reporting period.

3

The standard grace period for a life insurance policy sold in Washington is

30 days

The standard grace period for a group life insurance policy sold in Washington is

31 days

As classified by the Affordable Care Act (ACA), a Silver Plan offers

70% actuarial level of coverage provided

An insurance producer is BEST defined as

A person who has a contract with an insurance company to represent it

An example of rebating is

A producer who shares commissions with a client

Life insurance replacement can be best described as

A transaction in which a new life insurance policy is purchased and an existing life insurance policy is surrendered

A company that is chartered and organized in any country other than the United States is called a(n) _____ company.

Alien

A group policy may be issued to a labor union. The members eligible for insurance under the policy shall be

All of the members of the union

Which of the following statements regarding the Fair Credit Reporting Act is TRUE?

An insurer does NOT need to discuss any credit history inconsistencies with the applicant

All of these are considered forms of advertising EXCEPT

An insurer's AM Best rating

Before a producer may sell, solicit, or negotiate insurance from an insurer, the producer must have a(n)

Appointment

_____ is the authority given to a producer to sell, solicit, or negotiate policies on the behalf of an insurer.

Appointment

Advertising regulations exist to

Assure full and truthful disclosures to the public

When does a family health (disability) policy's coverage for a newborn child begin?

At the moment of birth

No insurance company may transact business in Washington without a Certificate of _____.

Authority

An insurance company that has qualified and received a Certificate of Authority from the Insurance Department to sell insurance in this state is called a(n)

Authorized insurer

Which of these procedures do insurers have the right to perform where it is not forbidden by law?

Autopsy

A domestic insurance company in Washington MUST

Be formed under the laws of Washington

What happens if the insurer discovers that the insured's age was accidentally misstated on an application for an individual life insurance policy?

Benefits will be calculated according to how much coverage the premium paid would have been purchased for the correct age

Coverage for newborns under an accident and health (disability) plan MUST include coverage for

Birth abnormalities

How are health plans classified according to the Affordable Care Act?

Bronze, Silver, Gold, Platinum

What enables applicants to compare different life insurance policies and helps them choose which policy is best for their needs?

Buyer's guide

An example of replacement is

Canceling a term life policy to buy a whole life policy

Which of the following is required for an insurer to conduct business in this state?

Certificate of Authority

An Outline of _____ is required for long-term care policies and provides a brief description on the important features of the policy.

Coverage

Which of the following unfair trade practices involves a producer who makes malicious, public statements regarding an insurer's financial condition?

Defamation

Which of the following unfair trade practices involves a producer who makes public, malicious statements about an insurer's financial condition?

Defamation

Advertising regulations exist in order to

Demonstrate full and truthful disclosures to the public

A Medicare Supplement policy's outline of coverage MUST include a(n)

Description of policy benefits

Which of the following circumstances requires an individual to be a licensed producer?

Discussing premiums with a potential insured

A company that is chartered and organized of the state in which its home office is located is called a(n)

Domestic insurer

One role of the Commissioner is to

Enforce state insurance laws

What is the purpose of the Washington Life and Disability Insurance Guaranty Association?

Ensures that claims filed against insolvent insurance companies will be paid

What provision states that the policy and application shall constitute the entire contract between parties?

Entire contract

How often must the Commissioner examine each domestic insurance company?

Every 5 years

How often must an insurance producer's license in Washington be renewed?

Every two years

Replacement can be BEST described as

Exchanging a new policy for one already in force

Which of these is not a characteristic of a Fraternal Benefit Society

Exists for profit

An example of an Unfair Claims Settlement practice is

Failing to promptly provide reasonable explanations for the denial of claims

A producer is meeting with a client to determine whether an annuity would be suitable for purchase. Which of the following topics needs to be discussed with the client?

Financial objectives

Violations of US Code Title 18 section 1033, may result in

Fine and/or imprisonment

The renewability provision for an individual long-term care insurance policy must be located on the policy form's

First page

XYZ Life Insurance company's home office is located in Ohio and is incorporated in Ohio. In Washington, they are considered to be

Foreign

What is a nonprofit entity, operating under a lodge system?

Fraternal

Under the Affordable Care Act, which of these plans is designed to provide coverage that is actuarially equivalent to 80% of the full actuarial value of the benefits provided under the plan?

Gold

Which of the following is NOT information found in a life insurance buyer's guide?

How to take legal action against an insurance company

Refusing an insurance applicant because of marital status is an example of

Illegal discrimination

If an accident and health (disability) is reinstated after it had lapsed for nonpayment, accidents will be covered

Immediately

Under which circumstance may a deferred insurance commission be paid to an individual?

Individual was a licensed producer at the time of the sale

An insurer is REQUIRED to offer which of the following to each long-term care applicant at the time of purchase?

Inflation protection

An _____ _____ sells, solicits, or negotiates insurance contracts for compensation.

Insurance producer

The identity of the _____ must be made clear in every health (disability) insurance advertisement.

Insurer

Who is required to notify the producer in the event of appointment termination?

Insurer

A foreign insurance company doing business in Washington

Is a company that was formed under the laws of another state

An alien insurer

Is an insurer that is operating in the U.S. but headquartered outside the U.S.

Which of the following is CORRECT regarding disclosure regulation?

It requires the delivery of a buyer's guide and a disclosure document to applicants

An insurance company may only pay commissions to a(n)

Licensed producer appointed by the insurer

A producer may be disciplined by the Commissioner for which of the following actions?

Misappropriation of premium funds

A licensee who informs an insured of inaccurate terms, benefits, or advantages of any policy is committing which of the following violations?

Misrepresentation

Benefits for a Medicare Supplement policy

Must not duplicate Medicare benefits

All of the following are typically included in a life insurance policy illustration EXCEPT

Names of the beneficiaries

A producer who is licensed in Washington but resident in another state is called a

Nonresident producer

When a producer is determining the suitability of an annuity for a client, which of these is NOT usually taken into consideration?

Number of dependents

When a producer is replacing an existing ordinary life insurance policy, the producer must take all of the following actions EXCEPT

Obtain the beneficiary's signature on a summary of all policies to be replaced

A producer who sells an individual life insurance policy in Washington must deliver to the policyowner a(n)

Policy Summary and Buyer's Guide

XYZ Corp was issued a group health policy for its employees. Under this plan a

Policy must be issued to XYZ, and a certificate must be issued to each employee

Replacement regulation is designated to protect

Policyowners from misrepresentations and loss of benefits

All Medicare Supplement policies MUST contain which provision?

Pre-existing conditions may be excluded from coverage for a maximum of 6 months

A life insurance producer is required to give a disclosure notice about information practices to an applicant or proposed insured

Prior to or at the time of signing the application

A(n) _____ negotiates an insurance contract on behalf of an insurer.

Producer

An individual who has a contract with an insurance company to represent it is called a(n)

Producer

When must a claim on a life insurance policy be paid after proof of loss has been received by the insurer?

Promptly

Which of the following is NOT a circumstance to which a temporary producer license can be issued?

Prospective producer who is willing to take the state licensing exam

What is considered the purpose of the Guaranty Association?

Protects insured from insolvent insurers

Which of these is NOT an Unfair Claims Settlement practice?

Providing claim payments to insureds under the the guidance of the insurance contract

An example of misrepresentation is

Providing incorrect, misleading, incomplete, or materially untrue information in the license application

Barry offers Chris a mountain cabin for the weekend to secure his order for his insurance business. This is an example of

Rebating

Insurance producer Kelly offers an insured $500 shopping card if an insurance product is purchased through her. What is this an example of?

Rebating

The promise of a discount in premium as an inducement to purchase insurance is known as

Rebating

Which of the following is an example of a producer's fiduciary duty?

Recording receipt and remittance of premiums due to the insurance company

Any transaction in which new life insurance is purchased and, as a result, the existing life insurance will be surrendered is called

Replacement

Which of these individuals would require continuing education?

Resident producer

Long-term care policies sold in Washington may NOT exclude coverage for

Senile dementia

Which of these is NOT an Unfair Claims Settlement practice?

Settling a claim by arbitration

Kiara filled out a life insurance application and was given a policy illustration that showed future premiums being paid out of nonguaranteed values. This illustration MUST disclose that

She may need to resume premium payments, depending on actual results

According to the Affordable Care Act, what metal tier is required to have an actuarial value of 70% with covered individuals paying 30% through deductibles, co-pays, and other cost sharing features?

Silver Plan

A ______ is the person who is responsible for payment for a health maintenance organization (HMO).

Subscriber

What may be the result of replacing an existing life insurance policy with a new one?

Surrender charge

A _____ license may be issued in cases where a producer has become disabled or dies, requiring a replacement to service the producer's business.

Temporary

A producer does NOT have a fiduciary responsibility to

The Washington Guaranty Association

When a Medicare Supplement insurance policy is being replaced, who must sign the notice of replacement?

The producer and the applicant

An insurer may pay a commission in which of the following scenarios?

To a licensed producer who is appointed with the insurer

An insurance company that has been denied or not yet applied for a Certificate of Authority is called

Unauthorized

Under which circumstances may a commission be shared between two producers?

When they are both licensed in the same line of business

The Fair Credit Reporting Act protects consumers

With guidelines regarding credit reporting and distribution

Proof of loss on a health (disability) insurance claim must be submitted to an insurer within ___ days after the insured's date of loss.

90

In Washington, an insurance producer cannot sell, solicit, or negotiate policies for an insurer unless there is an agreement in place between the producer and insurer. This agreement is called a(n)

Appointment

Within ___ days after policy delivery, disability policies can be returned for a 100% premium refund.

10

An insurer must submit all policy forms and applications to the Commissioner at least ___ days before they can be used.

30

Every producer licensed in Washington must notify the Commissioner within ___ days of any change of the address.

30

If an Insurer terminates a producer's appointment, it must notify the Commissioner within ___ days of the termination.

30

The Right-to-Examine period is ___ days for all Long-Term Care Policies sold in Washington.

30

Within ___ days after policy delivery, both Medicare Supplement and Long-Term Care policies can be returned for a 100% premium refund.

30

The required grace period for life insurance policies sold in Washington is

30 days

Greg had recently been terminated from his job that covered him for group life insurance. How long does he have to convert his coverage to an individual policy?

31 days

The Commissioner must examine the financial affairs of each admitted insurer operating in Washington at least once every

5 years

An insurer may exclude preexisting conditions on a Medicare Supplement policy for ___ months.

6

If an insurer refuses to pay a claim, how many days must the insured wait to take legal action against a health insurer after submitting written proof of loss?

60

The grace period for an accident and health (disability) policy is ___ days for weekly premium policies.

7

A person cannot sell Long-Term care insurance unless that person is licensed as an insurance producer and has successfully completed a one-time education course of

8 hours

A life policy loan in Washington cannot charge a fixed rate of interest higher than

8%

In the event of a controversy between the insured and the company, the producer is considered to represent the

Company

An association operating solely for the benefit for its members and their beneficiaries is called a

Fraternal Benefit Society

Which of the following is NOT considered to be an act of "transacting insurance"?

Gathering prospective buyer information

In Washington, a Long-Term Care policy must be ______ renewable.

Guaranteed

In Washington, a Medicare Supplement policy must be ______ renewable.

Guaranteed

The Washington Life and Health _____ Association is used to rehabilitate insolvent users.

Guaranty

A producer's license may only be suspended or revoked if the producer

Has been afforded a right to a hearing

Maria the producer would like to advertise an annuity product on a highway billboard. Which of the following must be included in the advertisement?

Her name

An insurer would be committing Unfair Discrimination if coverage was denied based upon

Marital status

A policyholder's unmarried child is incapable of self support due to a physical disability. The child is provided medical care coverage under the parent's policy

Until policy termination with proof of incapacity

A type of policy that would help pay for uncovered Medicare claims is called

Medicare Supplement

The Life and Disability Guaranty Association provides funds to carry out its powers and duties by assessing

Member insurers

During the examination of an insurer's books and records by the Commissioner, the insurer

Must not impede the examination

A Medicare Supplement policy can be cancelled by the insurer for

Nonpayment

A person who is not a legal resident of Washington may be licensed to act in this state as a(n) _____ insurance provider without taking a written examination.

Nonresident

Charles is a producer who is licensed in Washington but resides in Oregon. Charles is considered to be a(n)

Nonresident producer

When replacing a life insurance policy, a producer must provide the applicant with a

Notice Regarding Replacement

Suitability is best described as

Obtaining information from the applicant to determine whether an insurance or annuity product is appropriate

Inducement is BEST defined as

Offering to buy, sell, give, or allow a prospective insurance employment, stock or special favors in exchange for an insurance contract

The _____ is responsible for determining the appropriateness of a Medicare Supplement policy for an applicant

Producer

Twisting is

Replacing an insurance policy from one insurer to another based on misrepresentation

A(n) _____ company is owned by its shareholders.

Stock

An advertisement for an insurance product may contain

The insurer's name

An example of an unfair claims settlement practice is

Turning down a claim without providing the basis of denial

The act of using misrepresentation to induce an insured person to terminate an existing policy and purchase a new policy is referred to as

Twisting

A producer has committed an insurance crime that violates the U.S. Code 1033 (interstate commerce). Who would be responsible for the prosecution of this crime?

US Attorney General


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