Illinois Common to All Lines
The Illinois Insurance Guaranty Fund was established to protect all of the following EXCEPT..? A) Insurers B) Insureds C) Policyholders D) Claimants
A) Insurers
What is the resident producer license fee payable once every two years? A) $250 B) $100 C) $180 D) $50
C) $180
An insurer publishes intimidating brochures that portray the insurer's competition as financially and professionally unstable. Which of the following best describes this act? A) Illegal until endorsed by the Guaranty Association B) Legal, provided that the other insurers are paid royalties for the usage of their names C) Illegal under any circumstances D) Legal, provided that the information can be verified
Illegal under any circumstances
Of the following persons which one would be required to hold a producer's license? A) Person soliciting policies of insurance B) An officer of an insurer who does not receive commissions C) A trainer at an insurance company who does not sell insurance D) Underwriter
A) Person soliciting policies of insurance
The act of rebating is considered a(n)..? A) Felony B) Infraction C) Class A misdemeanor D) Class B misdemeanor
D) Class B misdemeanor
If a licensee charges any fee separate from a commission off of the insured's premium, and if the fee exceeds 10% of the premium's value, what must the licensee obtain? A) Director's permission B) Special tax form C) Premium Fund Trust form D) Insured's signature
D) Insured's signature
any inducement offered to the insured in the sale of insurance products that is not specified in the policy is an unlawful practice known as..? A) False advertising B) Coercion C) Rebating D) Twisting
C) Rebating
A person is in the process of becoming permanently licensed as a producer. A temporary producer's license may be issued for a maximum period of..? A) 90 days B) 100 days C) 120 days D) 180 days
A) 90 days
Which of the following defines the term controlled business? A) Insurance written on the interests of the producer who solicits a policy B) Insurance policies regulated by the State Department of Insurance C) Lines of authority for which a producer is licensed D) Transactions that are subject to the examination by the Director
A) Insurance written on the interests of the producer who solicits a policy
Which of the following situations would describe a proper handling of premiums by a producer in this state? A) A temporary producer is not under the obligation to hold the premiums in a fiduciary capacity B) A producer who holds premiums for 15 days establishes a Premium Fund Trust Account C) A producer is using the premiums account as a general operations account D) Fiduciary account balance is less than the amount deposited due to the number of claims
B) A producer who holds premiums for 15 days establishes a Premium Fund Trust Account
Ron's application to become an insurance producer has been denied. What is the soonest possible time that he can apply again? A) 1 year B) 2 years C) 3 years D) Once the application is denied, all subsequent applications will also be denied
C) 3 years
How long must an insurer keep books an records of insurance transactions in the Premium Fund Trust Account? A) 3 years B) 5 years C) 7 years D) Indefinitely
C) 7 years
All of the following are regulated areas of the insurance industry EXCEPT..? A) Trade practices B) Investments C) Commissions D) Producers
C) Commissions
A producer failed to complete the required continuing education credit hours for this compliance period, and allowed his license to lapse. Within what time period after the deadline may the license be reinstated? A) 30 days B) 90 days C) 6 months D) 12 months
D) 12 months
In order for a firm to maintain its registration as a legal insurance company, what must it do? A) Nothing. Once a firm is registered with the Director, there is nothing that an insurer must do in order to maintain the registration B) Submit registration application annually C) Pass a semi-annual inspection for the first 2 years D) Submit a biennial fee to the Director
D) Submit a biennial fee to the Director
Within how many days may a person who is being examined by the Director for nonfinancial business practices request a hearing after receiving the examination report? A) 3 days B) 10 days C) 15 days D) 30 days
B) 10 days
A producer receives notice that his license has been terminated. If the producer wants to have the charges reviewed in court, within what time period must the request be made? A) 15 days B) 30 days C) 45 days D) 60 days
B) 30 days
If an insured requests forms that are necessary to present a claim, within how many working days must the insurer provide the forms? A) 5 days B) 10 days C) 15 days D) 20 days
C) 15 days
All of the following could be considered rebates if offered to an insured in the sale of insurance EXCEPT..? A) Stocks, securities, or bonds B) An offer to share in commissions generated by the sale C) Dividends from a mutual insurer D) An offer of employment
C) Dividends from a mutual insurer
If a licensed producer dies, the Director may issue a temporary license to that producer's representative for an initial period of..? A) 9 months B) 1 year C) 60 days D) 180 days
D) 180 days
The Director suspends a producer's license. Which of the following occupations could serve the producer during the suspension? A) Insurance counselor B) Insurance producer C) Insurance underwriter D) None of the above
D) None of the above
The Director notifies a producer of license termination on March 1. On April 15, the Director receives a request to review the charges in a court of law. What is the latest possible court date that can be set for the hearing? A) April 25 B) May 15 C) October 15 D) The court date will not be established
D) The court date will not be established
If a person applies to become a life insurance producer, what is the minimum number of hours of pre-licensing education that must be completed in a classroom? A) 7.5 B) 10 C) 12.5 D) 20
A) 7.5
Which of the following is an example of a producer being involved in an unfair trade practice of rebating? A) Telling a client that his first premium will be waived if he purchases the insurance policy today B) Inducing the insured to drop a policy in favor of another one when it is not in the insured's best interest C) Charging a client a higher premium for the same policy as another client in the same insuring class D) Making deceptive statements about a competitor
A) Telling a client that his first premium will be waived if he purchases the insurance policy today
Producers who broker insurance must file a bond along with the application for license. The bond must be issued in favor of the people of Illinois, and must be on a continuous form and for an amount equal to 5% of the premium brokered the previous year, NOT to exceed..? A) $10,000 B) $25,000 C) $50,000 D) $100,000
C) $50,000
The Director may refuse to issue a license if a licensee's aggregate amount of premiums on controlled business exceeded the aggregate amount of premiums on all other insurance business during..? A) Any 1 year B) The licensing period C) 2 calendar years immediately preceding the extension date of the license D) The 6-month period immediately following the issuance or extension license
C) 2 calendar years immediately preceding the extension date of the license
A group insurance policy was solicited by a limited insurance representative. Which of the following is true according to the disclosure? A) Disclosure regulation does not apply to group insurance B) The name of the representative must be displayed on each certificate of insurance C) The representative's name and signature must appear on the master policy D) Disclosure regulation does not apply to limited insurance representatives
C) The representative's name and signature must appear on the master policy
Illinois law requires that a licensed insurance producer notify the Director, in writing, of any change in their residential address within..? A) 30 days B) 60 days C) 90 days D) 10 days
D) 30 days
The Director issued a written notice about a hearing for a business entity. The hearing is scheduled for May 1st. The affected business entity should receive the notice no later than..? A) April 1st B) 3 business days before the hearing C) 2 weeks in advance D) April 20th
D) April 20th
All of the following are true about the bond requirements in the state of Illinois EXCEPT..? A) Maintaining a bond or appointing insurance company is a requirement to holding a producer's license B) The maximum the bond would have to be is $50,000 C) The amount of the bond must be $2,500 or 5% of the premiums collected in the previous year D) Insurance producers with insurance companies that take responsibility for their actions are still required to post a bond
D) Insurance producers with insurance companies that take responsibility for their actions are still required to post a bond
Which of the following best describes a misrepresentation? A) Making a deceptive or untrue statement about a person engaged in the insurance business B) Making a maliciously critical statement that is intended to injure another person C) Discriminating among individuals of the same insuring class D) Issuing sales material with exaggerated statements about policy benefits
D) Issuing sales material with exaggerated statements about policy benefits
Which of the following best describes the unfair trade practice of defamation? A) Assuming the name and identity of another person B) Issuing false advertising material C) Refusing to deal with other insurers D) Making derogatory oral statements about another insurer's financial condition
D) Making derogatory oral statements about another insurer's financial condition
If an actuary would like to sell life insurance policies, what licensure is needed? A) Producer's license for life insurance B) General producer's license C) Broker's license D) Insurer's license
A) Producer's license for life insurance
If a nonresident is applying for a license in Illinois and his home state does not require continuing education for Illinois residents..? A) The applicant must complete the required education in Illinois before being issued a license B) The applicant can take a federal exam that will serve the continuing education requirement in Illinois C) If the applicant has been licensed for over 10 years in his home state, the continuing education requirement is waived D) The continuing education requirement will be waived in Illinois
D) The continuing education requirement will be waived in Illinois
All of the following are true about license denial, suspension or revocation EXCEPT..? A) Failing to pay child support or state income taxes is grounds for loss of license B) An agent may still sell insurance on a suspended license for 180 days C) A suspended, denied or revoked license must be surrendered to the Director D) An agent may lose his or her license for forging another signature
B) An agent may still sell insurance on a suspended license for 180 days
With which entity must a corporation register before it will be allowed to operate as an insurance agency? A) MIB B) Director C) National Federation of Insurers D) Federal Board of Insurance
B) Director
All policy applications must identify which of the following? A) Director B) Producer who solicited the applicant's business C) Conditions of acceptance D) MIB
B) Producer who solicited the applicant's business
In the event an insured is found guilty of committing defamation, the insurer may be subject to the maximum penalty of..? A) $1,000 B) $5,000 C) $10,000 D) $20,000
C) $10,000
Before each license renewal, an insurance producer must complete at least how many hours of continuing education? A) 14 B) 20 C) 24 D) 30
C) 24
An applicant receives a temporary insurance producer license. After 80 days, the owner of the insurance company decides to sell the business. Which of the following is TRUE? A) The license may be converted to a permanent producer license B) The Director will assess the case and make the ultimate decision C) The license will automatically terminate D) The license can be applied elsewhere
C) The license will automatically terminate
All of the following are true regarding rebates EXCEPT..? A) Rebates are only allowed if specifically stated in the policy B) Rebating can be anything of economic value, given as an inducement to buy C) Dividends are not considered to be rebates D) Rebates are allowed if it's in the best interest of the client
D) Rebates are allowed if it's in the best interest of the client
Which of the following would be considered an unfair claims settlement practice? A) A claims adjuster advises the insured that if the claim goes to arbitration, the insured would probably receive less than what is currently being offered B) Requesting the insured to submit a signed, proof of loss statement, after the insured has already verbally advised the insurer of the claim C) Requesting the insured swear under oath concerning the facts of the claim D) The settlement of the claim is delayed for 30 days in order for the insured to conduct an investigation
A) A claims adjuster advises the insured that if the claim goes to arbitration, the insured would probably receive less than what is currently being offered
Which of the following terms describes making false statements about the financial condition of any insurer that are intended to injure any person engaged in the business of insurance? A) Undercutting B) Twisting C) Slandering D) Defamation
D) Defamation