Aware 2 pass
Which is not part of transacting insurance?
Establishing client lists to contact
An insurer made an error in the issuing, renewing and servicing a policy that was unintentional however; they were still found guilty improper practices. The insurer could be prosecuted for how many violations based on this information?
3
According to Fair Claims Settlement Practices in the CCRs the insurer has how many calendar days to remit payment for a claim once all parties are in agreement:
30 days
According to HIPAA plans can exclude pre-existing conditions for up to 12 months which can be reduced by the amount of time they had "creditable coverage" prior to enrolling in the plan provided there were not significant breaks in coverage. The maximum time there can be for a break in coverage is:
63 days or less
Judgment rating is based on:
An evaluation of the individual risk's characteristics
A company that negotiates and binds ceding reinsurance on behalf of an insurer is considered:
A managing general agent
According to the California Department of Insurance (DOI) an admitted insurer:
Agrees to transacts insurance following the laws of the state of California
The Insurance Information and Privacy Act dictates that insurance companies and Agents:
All are correct statements as well as agents and insurers are to allow insured's and applicants access to the information gathered for the purpose of verifying and disputing its accuracy
According to the California Insurance Code (CIC) it is acceptable to limit, refuse, or impose a different rate for anyone who has a physical mental handicap:
All of these are acceptable reasons
Any person who transacts insurance without a valid license is:
All of these are correct
An agent of an insurance company and the insurer must disclose the insurer's privacy policy according the Gramm-Leach-Bliley Act (required distribution):
All of these are correct and required
In order for a rate to remain in effect it must be:
All of these are required
No insurer may require however they may suggest or recommend that an automobile be repaired at a specific automotive repair dealer under which of the following conditions?
All of these are requirements when an insurer or agent makes a referral
The type of health information that is protected by the Privacy Rule under the provisions of HIPAA is information that:
All of this information is protected under the Privacy Rule
Which of the following provisions is not a part of HIPAA?
Annual limits and lifetime spending limits
Select the CORRECT statement below concerning COBRA and Cal- COBRA:
COBRA and Cal- COBRA protects dependents of employees by mandating for them the same extension and conversion privileges available to employees covered by group plans
To surrender a license for cancellation that is in the possession of an employer or insurer the licensee must:
Deliver the document itself to the Commissioner
Which of the following is considered an unfair claims practice?
Failing to affirm or deny coverage within a reasonable time after receiving proof of loss
Which of the following is not true concerning the Gramm-Leach-Bliley Act?
Financial institutions must give customers an opportunity to "opt-in" before disclosing nonpublic information to an unaffiliated third party
Associations organized to protect claimants, policyholders, annuitants, and creditors of financially impaired insurers are known as:
Guaranty Associations
Any change in any of the producers/licensee's addresses: mailing, business, email or residential the DOI must be notified:
Immediately by electronic means approved by the commissioner
The standards and guidelines that insurers must follow regarding the collection, usages, and disclosures of any information that is obtained about an insured for insurance transactions falls under:
Insurance and Information and Privacy Act
Which of the following insurance professionals would be employed to aid an insurance broker?
Insurance solicitor
The purpose of the 16 point bold type disclosure on a surplus lines policy is to inform the:
Insured that the policy is being issued through a non-admitted insurer
The Commissioner of Insurance and the DOI has all of the following powers, except:
Interpreting policy provisions
When a premium is based solely on an underwriter's evaluation of an individual applicant's loss potential this is known as:
Judgment rating
Which of the following would not be a temptation for an agent to act unethically?
Maintaining the best interest of the client
Which of the following does not contain provisions protecting individual privacy?
McCarran-Ferguson Act
What rating method makes modifications to manual rates to reflect the unique characteristics of each risk?
Merit rating
What is required of a broker/agent before appointing an insurance solicitor?
Must hold a permanent license
According to the code neither party to a contract is bound to communicate information:
Neither party is bound to communicate information based on all of these
A managing general agent with a property & casualty broker/agent license cannot do which of the following?
None of these are excluded from the powers and authority given to the managing general agent.
Which of the following is incorrect concerning rescission?
None of these statements are correct
Licensees that make referrals to automobile repair facilities may:
Not receive any financial benefit for the referral
Which of the following would not be considered an unethical practice?
Not using insurance terminology instead use simply language that a layman can understand
California uses which of the following methods to approve or disapprove the rates filed by insurers for various types of insurance such as homeowners or auto?
Prior approval method
Insurer insolvency (financial instability) is a major concern of consumers. Concerning insolvency which of the following is not true?
Reassure the client that even if the insurer's rating is below average that the insurer is insured against insolvency so their claim will still be paid
The negotiation of a policy would involve which of the following:
Sending the prospect an email suggesting that they buy a certain type of policy
Any person who makes a loan of money using real property as security
Shall not make available the information contained in a borrower's fire or casualty policy if the borrower has filed a statement with the lender that they do not want the lender to disclose this information
The execution of an insurance policy would involve which of the following?
Signing the binder
If an insurer allows an agent to induce a member of the public by making a misleading comparison to change their existing insurance the Commissioner has the authority to:
Suspend the insurer's Certificate of Authority in that particular class/line of insurance
When an organization such as a corporation ceases to exist entirely their license would:
Terminate
Which of the following would not be a qualify event under Cal-COBRA or COBRA:
Termination of employee due to gross misconduct
According to California Insurance Code (CIC) with respect to an inspection for private passenger vehicles that are being added to the insured's personal auto policy:
The California Insurance Codes does not require vehicles to be inspected. This could be an underwriting requirement of the insurer
In exchange for the privilege of transacting surplus lines business in a state, a premium tax is charged on the direct surplus lines premiums written by each surplus lines broker. Which of the following is incorrect concerning the premium tax?
The DOI charges and collects taxes directly from the unauthorized carriers
Where do most states require insurers to file policy forms?
The Insurance Department
Concerning agency names the true name of a corporation or a business entity or individual:
The commissioner can disapprove of any name unless it is the bona fide name of an individual as shown on their birth certificate
Concerning premium financing which of the following is true?
The department of insurance (DOI) requires agents and brokers to maintain records of the compensation they received for premium financing services
A licensee in this state who advertises on the internet and transacts with California residents must identify all of the following on the internet, except:
The expiration date of the licensee's license
Who has ownership of renewals and policyholders between an insurer and an independent agent?
The independent agent
Applicants for insurance must be given advance notice, including all the following types of information, except:
The persons who are collecting information
A person in the business of financing real or personal property it is lawful for them to verbally recommend that insurance be placed through a particular agent or insurer, only if:
The recommendation is also put in writing
The Commissioner may disapprove in writing the use of any true name or any fictitious name by any licensee on any of the following grounds, except:
The use of the bona fide natural name of an individual
The applicant or policyholder must be given a written notice of information practices any time the insurer is seeking information form other than them or public records. This notice applies when its:
This notice applies to all of these situations
