Insurance Regulations

The document that indicates that an insurer has been approved and is authorized to transact insurance in a particular state is known as what?

Certificate of Authority.

An insurance agent/brokers license appointment is effective until what?

- The agent's license expires or is revoked - The appointment has expired - Written notice of termination of the appointment is filed with the Commissioner

Who is guilty of an illegal act when a property insurance policy is knowingly written with limits that exceed the amount that could be expected to be paid in the event of loss?

-The insurer issuing the policy - The applicant who requests the policy - The insured who accepts the policy

Who is required to be licensed as an insurance producer?

A salaried employee who advertises and solicits insurance

The purpose of insurance regulation is to...

Promote the public welfare

When an insured's auto is damaged by collision with an at-fault uninsured motorist, what is the maximum deductible amount that may be applied to the loss paid under uninsured motorist property damage?

$100

Insurance contracts are agreements between which two parties?

Insured and insurer

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 what?

Misrepresentation

What may NOT be included in an insurance company's advertisement?

That its policies are covered by a state Guaranty Association

When a notice of nonrenewal is furnished to an insured, how soon a copy of the notice must be provided to the insured's agent?

Within 5 business days

Driver X parked her car on a busy downtown street. Before she could get out of her car, Drive Y made contact with her car's rear bumper. There was no visible damage to either vehicle and no one was hurt. Who must show proof of vehicle insurance?

Neither one of the drives are required to show proof because there was no damage and no injury

Under what circumstance may an insurer use a 20-day notice to increase premium amounts by changing rates?

On a one-time basis in connection with the renewal of the policy

Required records of insurance transactions of an agent, broker, or adjuster, must be kept for a period of....

5 years after the transaction has been completed

All of the following situations considered rebating EXCEPT A. An agent invites a prospective insured to a baseball game and pays $75 for admission for both of them B. An agent gives out as a raffle prize to a prospective policyowner a new blender with a market retail value of $300 C. An agent offers a prospective insured a $150 dollar voucher for a restaurant D. An agent provides a prospective policyowner with monthly cash payment of $20 for 6 consecutive months

A. An agent invites a prospective insured to a baseball game and pays $75 for admission for both of them

A driver moves to this state with motor vehicle coverage of 15/25/5. All of the following are true EXCEPT A. The driver must obtain new insurance B. The driver's coverage for bodily injuries is $15,000 C. The driver has proof of financial responsibility in this state D. The driver may be personally liable if an accident occurs

C. The driver has proof of financial responsibility in this state

What describes making false statements about the financial condition of any insurer that are intended to injure any person engaged in the business of insurance?

Defamation

When an insurer cancels the agency contract of an independent agent, the insurer must renew expiring policies

For a period of 1 year

What would be considered false advertising?

Implying that the agent is the insurer

Any person who transacts insurance without a license is punishable with a Class B felony. If the commissioner has reason to believe that any person has violated this rule, the commissioner may not do what?

Impose a prison sentence of no more than 6 months

What is surplus insurance?

Insurance placed with an unauthorized insurer

Every order by the Commissioner suspending any insurance license must specify the period during which the suspension will be effective and may not last longer than how long?

12 months

All of the following violations may result in an agent's imprisonment EXCEPT A. Failing to report to the department a criminal prosecution taken against the agent in another jurisdiction B. Embezzling funds from the insurer C. Knowingly obtaining information about a consumer under false pretenses D. Engaging in the business of insurance after being convicted of breach of trust

A. Failing to report to the department of a criminal prosecution taken against the agent in another jurisdiction

According to the Fair Credit Reporting Act, all of the following would be considered negative information about a consumer EXCEPT A. Late payments B. Failure to pay off a loan C. Disputes regarding consumer repost information D. Tax delinquencies

C. Disputes regarding consumer report information

The insurance Commissioner is empowered by the Washington Insurance Code to perform all of the following duties EXCEPT A. Levy fines against insurers found in violation of the Insurance Code. B. Revoke the appointment of a deputy. C. Make revisions to the Insurance Code. D. Investigate the business practices of insurers.

C. Make revisions to the Insurance Code

A producer did not do his research and placed insurance coverage through an unauthorized insurer. When this becomes known, what may the commissioner do?

Order a policy replacement

A producer has established a separate account for premiums collected on life insurance policies sold by the producer. Who is entitled to the interest earned on the deposits in the separate account?

Producer

Agent J offers his clients free tickets to sporting events in exchange for the purchase of an insurance policy. J is guilty of what?

Rebating

An insurance application cannot ask about what information about an applicant?

Sexual orientation

The term "producer" refers to any person appointed by an insurer to do what?

Solicit applications for insurance on its behalf

If an insurance company makes a payment to the insured because the at-fault motorist's insurance company is insolvent, the insured's insurance company must have the subrogation rights against what?

The insolvent insurance company

What is an agreement between an insured and an insurer, where the insurer agrees to indemnify the insured for specific losses in exchange for a premium?

The insurance contract

How is it determined whether an insurer is allowed to write business in a state?

The insurers domicile or location of incorportation will determine whether a company is domestic, foreign or alien

If there is unearned premium on a canceled policy, the insurer must return the money to the insured

Within 45 days after the date of the cancellation