Insurance pt. 5
10 years
Any licensed person whose activities affect interstate commerce and who knowingly makes false material statements related to the business of insurance may be imprisoned for up to
False advertising
Circulation deceptive sales material to the public is what type of Unfair Trade Practice
Adjuster
Which of the following entities investigates and negotiated settlement of claims arising under insurance contracts, on behalf of an insurer?
Fraternal benefit society
Which of the following entities is not an insurer but an organization formed to provide insurance benefits for members of an affiliated lodge or religious organization?
The trust that a client places in the producer in regard to handling premiums
Which of the following is an example of a producer's fiduciary duty?
Discriminating in benefits and coverage based on the insured's habits and lifestyle
Which of the following will NOT be considered unfair discrimination by insurers?
Agent C uses her license to write only business other than controlled
Which of the following would NOT be a violation of state insurance regulations?
Coercion
A banker is ready to close on a customer's loan. The bank is prepared to offer the loan but only if the customer purchases an insurance policy from the bank in the amount of the loan. This is an example of
30 days
After receiving a cease and desist order, how long does a person have to request a hearing?
Putting the client's best interests before their own
In what way can an agent demonstrate a high standard of ethics?
Misrepresentation
On its advertisement, a company claims that it has funds in its possession that are, in fact, not available for the payment of losses or claims. The company is guilty of
Misdemeanor
Selling insurance policies without an appropriate license in this state is considered a
15 days
The Commissioner must be notified of new producer appointment within
24 hours every two years
The minimum continuing education requirement for life insurance agents is
Corporate bond
Upon assuming office, the Commissioner must post a(n)
Defamation
When a producer was reviewing a potential customer's coverage written by another company, the producer made several remarks that were maliciously critical of that other insurer. The producer could be found guilty of
Foreign
When doing business in this state, an insurance company that is formed under the laws of another state is known as which type of insurer?
Admitted
Which of the following is another term for an authorized insurer?
30
Within how many days must the insurer that terminates an agent's appointment notify the Commissioner?
The referral fee must be a one-time nominal, fixed-dollar amount
An agent wants to pay a referral fee to an unlicensed employee of a licensed agent. Which of the following statements is true?
A person who investigates claims arising under insurance contracts for fee or commission
An example of an insurance adjuster would be
Fraud
An insurance company assures its new policyholders that their premium costs will not increase for a period of at least five years. However, due to increasing financial strain, they plan to raise premium costs for all insureds by 10% over the next two years. What term best describes this act?
Reinvestigate
Carl's application for a life policy was rejected because of information disclosed in an inspection report. Carl reviewed the consumer reporting agency's file and found they had incorrect information concerning his personal life. Carl can legally require the reporting agency to
Obtain a list of all life insurance policies that will be replaced
During replacement of life insurance, a replacing insurer must do which of the following?
Statement of Good Health
Eddie submitted an application for life insurance without paying the premium. The application was approved, and now the agent is delivering the policy. What should the agent have Eddie sign?
Without receiving written consent from an insurance regulatory authority
Federal law makes it illegal for any individual convicted of a crime involving dishonesty or breach of trust to work in the business of insurance affecting interstate commerce
180 days
Following the death of a licensed agent, the executor or administrator of the deceased agent's estate, or the next of kin could obtain a temporary insurance license, without testing, issued for a period of
Solicit new business
Following the death of her husband, an insurance agent, Mary obtained a temporary insurance license. This license will allow Mary to do all of the following, except
Promptly forwarding premiums to the insurance company
Pertaining to insurance, which of the following is an example of a producer's fiduciary responsibility?
Inviting prospective clients to the grand opening of the company's new office
State law specifically prohibits using illegal inducements in the marketing of insurance. All of the following would be considered illegal inducements EXCEPT
Policyholders of any contract of insurance delivered in Mississippi
The Commissioner of Insurance may examine books and records of any of the following EXCEPT
$10,000
The Commissioner sent a producer a letter, and requested a response from that producer. The producer lost the letter, and, subsequently, never replied. What is the greatest civil penalty she could be assessed for this?
5 years
The Commissioner will examine financial records of every authorized insurer as often as deemed necessary, but at least every
If an insurer becomes insolvent, which of the following would pay benefits to policyholders?
The Guaranty Association
Promote the public welfare
The purpose of insurance regulation is to
The state
The regulation of the insurance industry primarily rests with
Fiduciary Responsibility
The requirement that agents not commingle insurance monies with their own funds is known as
Issue a cease and desist order
When the Commissioner determines that a licensee has violated the regulation of the Mississippi Insurance Code, the Commissioner's first response is likely to be
Alien insurer
When transacting business in this state insurer formed under the laws of another country is known as a/an
Issuing sales material with exaggerated statements about policy benefits
Which of the following best describes a misrepresentation?
Domestic
Which of the following best describes an insurance company that has been formed under the laws of this state?
Notice Regarding Replacement
Which of the following documents must be provided to the policyowner or applicant during policy replacement?
A sub-agent selling on a commission basis
Which of the following employees of an insurance producer must be licensed?
Only written statements can be considered fraud
Which of the following is NOT correct regarding false statements by a person engaged in the business of insurance?
It is issued to group insurance participants
Which of the following is NOT true regarding a Certificate of Authority?
Telling a client that his first premium will be waived if he purchases the insurance policy today
Which of the following is an example of a producer being involved in an unfair trade practice of rebating?
30 days
Producers are required to report to the Commissioner any administrative actions taken against them within how many days?
The policyowner must sign a delivery receipt
What must happen when an individual policy or annuity has been personally delivered to the policyowner?
Existing with the same insurer
When an individual life insurance policy is being replaced, the old policy must be all of the following EXCEPT
The Insurance Commissioner
When an insurer terminates the appointment of one of their agents for cause, the insurer is obligated to notify which of the following?
Handling insurer funds in a trust capacity
In insurance transactions, fiduciary responsibility means
An insurer with a home office in another state
What is a foreign insurer?
35% of aggregate premium in any 24 months
What is the highest percentage of controlled business that a licensed agent is allowed to write?
$1,000
What is the maximum fine for attempting to obtain a license through fraud or misrepresentation?
To protect policyowners against insurer insolvency
What is the purpose of the Insurance Guaranty Association?
Failing to report to the department a criminal prosecution taken against the agent in another jurisdiction
All of the following violations may result in an agent's imprisonment EXCEPT
Obtaining an insurance license
All of the following would be considered an insurance transaction EXCEPT
An agent misrepresents policy benefits to convince a policy owner to replace policies
All of the following would be considered rebating EXCEPT
Commingling
A producer who fails to separate monies from his own personal funds is guilty of
A misdemeanor
A violation of any provision of the insurance laws of Mississippi is considered
ABC
Ace, an independent agent, is appointed by ABC Insurance. Ace decides to place some advertisements in the paper so that people will be aware of the products. Some of the advertisements overstate the benefits of the policies. Who is responsible for this violation of advertising laws?
12 months
After a producer's license expires, they may reinstate it without having to take the licensing exam if they file for reinstatement within
$5,000 per violation
After finding that an individual is engaging in unlicensed insurance activity, the Commissioner issues a cease and desist order. if the respondent violates the order, they may be fined up to
November 20
After receiving a cease and desist order, a licensee requests a hearing regarding an alleged violation on November 10. What is the earliest date the hearing can be held?
Rebating
Any inducement offered to the insured in the sale of an insurance policy that is not specified in the policy is an unlawful practice known as
Nonrenewable coverage expiring in 8 years
To which of the following situations does the Replacement Regulation apply?
Discrimination
Two individual are in the same risk and age class; yet, they are charged different rates for their insurance policies due to an insignificant factor. What is this called?
5 years
What is the minimum required time period during which replacing insurers must keep records pertaining to a replacement transaction?
Illegal
An insurer devises an intimidation strategy in order to corner a large portion of the insurance market. Which of the following best describes this practice?
Illegal under any circumstances
An insurer publishes intimidating brochures that portray the insurer's competition as financially and professionally unstable. Which of the following best describes this act?
Illegal; insurers cannot pay commissions to people not licensed to transact insurance
An insurer wants to reward its office assistants by paying them a commission on each insurance contract sold. This is
Elected by the public for a 4-year term in the same election in which other state officials are chosen
How is the Commissioner of Insurance in Mississippi?
The producer must provide the applicant with a Notice Regarding Replacement
How must a replacing producer respond to an applicant wishing to replace existing life insurance?
5 days
If a producer's appointment is denied by the Commissioner, the Commissioner must notify the appointing agency within
24
If an agent has been licensed for over 18 months, for how many hours of continuing education is the agent responsible?
3 years
If an insurance company has their Certificate of Authority revoked for failure to pay a judgment within 90 days, after paying the judgment, they will be barred from doing business in Mississippi for a period of
An unfair trade practice
If an insurance company makes a statement that its policies are guaranteed by the existence of the Insurance Guaranty Association, that would be considered
The producer must be notified in writing
If the Commissioner has determined not to renew a producer's license, which of the following needs to happen?
A fine of up to $500 and up to 2 years in jail
In Mississippi, any person who acts as an agent without having the proper license may be found guilty of a misdemeanor and subject to a penalty of
Twisting
Agent's who persuade insureds to cancel a policy in favor of another one when it might not be in the insured's best interest are guilty of
Explaining to client the advantages of permanent insurance over term and suggesting changing policies
All of the following actions can be described as twisting EXCEPT
Sharing commissions
All of the following are considered unfair trade practices in the business of insurance EXCEPT
Rebates are allowed if it is in the best interest of the client
All of the following are true regarding rebates EXCEPT
Dividends from a mutual insurer
All of the following could be considered rebates if offered to an insured in the sale of insurance EXCEPT
Attempting to settle an insurance claim through arbitration
All of the following may be grounds for license suspension or revocation EXCEPT
$5,000
An agent breaks an insurance law regulating how long records must be kept. However, penalty for breaking this law hasn't been established. What is the maximum penalty the Commissioner may impose on the agent?
Rebating
An agent offers his client free tickets to a sporting event in exchange for the purchase of an insurance policy. The agent is guilty of
Controlled
An insurance producer just sold an insurance policy to his sister. What kind of business is this?
Apply and pay a fee to a nonresident license in this state
In order to get a nonresident license in this state, producers must
Certificate of Authority
To legally transact insurance in this state, an insurer must obtain which of the following?
Making comparisons between different policies
Which of the following is NOT considered a misrepresentation as it pertains to unfair trade practices?
That its policies are covered by a state Guaranty Association
Which of the following may NOT be included in an insurance company's advertisement?
Replacement rule
Which rule would apply if an agent knows an applicant is going to cash in an old policy and use the funds to purchase new insurance?
Twisting
Which type of misrepresentation persuades an insured, to his or her detriment, to cancel, lapse, or switch policies from one to another?
Return the policy to the insurer
Agent D submitted an application for life insurance on client A. No money was sent with the application. When Agent D attempted to deliver the policy, he discovered that A had suffered a heart attack since the application was taken. The agent should
The Federal Privacy Act of 1974
Because of the great amount of personal information that is available, and because of the increased number of agencies collecting and using this information, the Privacy Protection Study Commission was established to control the misuse of information and misinformation. This act is known as
Coercion
Forcing a client to buy insurance from a particular lender as a condition of granting a loan is defined as
