Chapter 4

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

Continue education, pay renewal fee

On its advertisement and company claim that it has funds and its possession that are in fact, not available for the payment of losses or claims, what is this company guilty of

MisRepresentation

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

Misrepresentation

Who must be notified of a producer change of address?

The department of insurance

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

defamation

Estate issued document empowering uninsurance company to become an admitted insurer is called what

Certificate of authority

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

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

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

Certificate Authority

Who is an insured agent

A person authorized to sell solicit and negotiate insurance contracts

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 competition, or an unfair practice what order will be issued?

Cease and assist order

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

Discrimination

Insurer were classified according to their domicile. What are the three types of insurers?

Domestic, foreign and alien

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

Fiduciary

What type of insure is formed under the laws of another state

Foreign

What is controlled business

Insurance on the producer for life or property or on producers, family or business associates

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

Insurance, company, officers, directors, or anyone who does not make deals

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

Only producers properly licensed

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 owns stock companies

Stock holders

Who is responsible for the costs associated with the examination of insurers

The insurer who is being examined

Two mayors certificate of authority be issued

To ensure her authorized to transact business in the state

What is the purpose of a cease-and-desist order?

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

Which type of misrepresentation persuades an insured to their treatment to cancel labs or switch policies from one to another

Twisting

When would a misrepresentation on an insurance application be considered fraud

When it is intentional and material

When is controlled business legal

When the commissions from controlled business do not exceed the aggregate commissions on all the other business

When can the commissioner and Director examine insurer?

Whenever deemed necessary, but at least once every 3 to 5 years

What type of license represents the insurance company?

agent