Property and Casualty License Ch 5 and 6
A person who, for a fee, examines, evaluates, and assesses contracts of insurance for another and offers advice on methods of reducing risk, must be licensed as
A risk manager
Which of the following would be required to be licensed as an insurance producer
A salaried employee who advertises and solicits insurance
After attending a company party at the corporate headquarters, an employee causes a car accident, is injured, and arrested for DUI. His medical injuries total $2,500, and his legal fees and fine for the DUI arrest total $12,000. How much will the company's workers compensation policy pay
$0
An insured has a policy with an insurance company that became insolvent. The policy has $1,600 of unearned premium. How much of this premium will the insured be able to recover from the Texas Property and Casualty Insurance Guaranty Association
$1,600
If an auto policy has split limits of 30/60/25, how much will the policy pay for property damage in a single accident
$25,000
Which of the following is the basic auto liability limit required for bodily injury or death to any one person in any one accident
$30,000
How many hours of continuing education can be carried over from one licensing period to the next
0
What is a required notice of cancellation of a Homeowners policy to the insured
10 days
The date of "maximum medical improvement" is defined as the earliest of the date that, based on medical probability, further medical improvement to an injury can no longer be reasonably anticipated, or
104 weeks
An employee's average weekly wage is computed according to the sum of wages paid in what period of time immediately preceding the date of the injury?
13 consecutive weeks
An insurer must acknowledge receipt of a Notice of Claim within how many days
15
In order to qualify for supplemental income benefits, an employee mush have an impairment rating of at least
15%
A risk managers license is good how many years
2
Within how many years must an agent renew an insurance license
2
If an agent has completed 35 hours of continuing education in one renewal period, how many CE hours will the agent have to complete in the next renewal period
24
If an agent suspects that insurance fraud is being committed, within how many days must the agent notify the Insurance Fraud Unit of the Department of Insurance?
30 days
The Commissioner of Insurance issues a Cease and Desist Order to an agent. If the agent wishes to contest the charges in court, how many days after the order was issued does the agent have to make the request
30 days
The limits of liability for bodily injury or property damage stated in an auto insurance policy are 30/60/25. What are the maximum limits of liability allowed for uninsured/underinsured motorist
30/60/25
How long must producer maintain records of continuing education course completion
4 years
No one whose license has been revoked can receive another license in Texas for
5 years
The insurance Commissioner may examine the affairs of any insurer as often as necessary, but not less frequently than once every
5 years
If a deceased employee is survived by an eligible spouse and 3 dependent children, what percentage of the death benefit will be paid to the spouse
50%
An insurer may cancel a personal auto policy if the policy has been in effect for at least how many days
60 days
Insurers must file all rates and forms for Commissioner's approval within how many days prior to use?
60 days
Under workers compensation, an insurance carrier will pay death benefits to the legal beneficiary in an amount equal to what portion of the employee's average weekly wage
75%
An agent's license will terminate within how many days from the due date of obligatory fees and continuing education requirements?
90
Which of the following is NOT a possible penalty for a violation of the Insurance Code
A fine of up to $100,000
Which of the following individuals could legally receive commissions from the sale of a life insurance policy
A licensed life insurance agent
A Managing General agent must complete the continuing education requirements that are set for
A local recording agent
Which of the following persons is required to hold a producer license
A person who negotiates insurance contracts
Which of the following is another term for an authorized insurer
Admitted
When transacting business in this state an insurer formed under the laws of another country is known as a/an
Alien insurer
Who are members of the Texas Windstorm Insurance Association
All authorized property insurers
Which of the following is a requirement for eligibility for coverage in the Texas Automobile Insurance Plan?
All of the above
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 under any circumstances
The Texas Windstorm Insurance Association provides windstorm and hail insurance
In the seacoast territory of this state only
What is surplus lines insurance
Insurance placed with an unauthorized insurer
An applicant for a license in Texas must include a statement with his application that provides information about all the following except
Intending to apply for another license
Which of the following best describes a misrepresentation
Issuing sales material with exaggerated statements about policy benefits
Which of the following is a TRUE statement about a temporary license issued in this state
It can only be issued once in any 6-month period
Which of the following is not true regarding a Certificate of Authority
It is issued to group insurance participants
In which of the following situations is it legal to limit coverage based on marital status
It is never legal to limit coverage based on marital status
A health care provider wants to provide medical professional liability insurance for its employees. Unfortunately, the provider has searched unsuccessfully for an insurance carrier that can provide this insurance
Joint Underwriting Association
All of the following are types of adjuster's licenses available in this state except
Life and health claims adjuster
The qualify for a surplus lines license, the applicant must be licensed as a(n)
Local recording agent
An employee who refuses services or refuses to cooperate with services provided by the Rehabilitation Commissions will
Lose entitlement to supplemental income benefits
According to the Texas Financial Responsibility Law, operating a motor vehicle without the required liability insurance is considered a/an
Misdemeanor
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. What is the company guilty of?
Misrepresentation
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
Rebating
All of the following are considered unfair trade practices in the business of insurance except
Sharing commissions
An Insurance Service Representative may perform any of the assigned duties in the office of a property and casualty agent, EXCEPT
Solicit applications for insurance
Words or terms that appear in an insurance policy in bold face print include
Specific definitions as to their meaning as used in the policy
Which of the following insurers are owned by stockholders
Stock
Insurance procured from an unauthorized insurer is called
Surplus lines insurance
A nonadmitted insurer who provides insurance coverages that are not available from an admitted insurer is called
Surplus lines insurer
Which of the following is an example of a producer being involved in an unfair trade practice of rebating
Telling a client that his first premium will be waived if he purchases the insurance policy today
An agent discovers his newest client was the result of a referral. To show his thanks to the referring customer, the agent could
Thank the customer
Bob's insurer declared bankruptcy. It has not yet paid his $1,000 claim. Which of the following is true?
The Property and Casualty Insurance Guaranty Association will cover his claim
The following are all causes for the Insurance Commissioner to suspend or impose conditions upon the continuance of an agents license except
The applicant has been shown to be a poor personal credit risk
Which of the following is not a licensing requirement for a corporation in the state of Texas
The business must be able to pay up to $50,000 in the event that is proven to be negligent
An insurer can cancel a personal auto policy by giving the named insured 10 days prior written notice for any of the following reasons EXCEPT if
The cancellation is to take effect on the 12-month anniversary of the policy
An employee may be eligible for supplemental income benefits upon
The expiration of the impairment income benefit period
An employee is injured on the job but decides not to tell his employer. He is treated in the emergency room and stays home to recuperate. Five days later, he feels better and returns to work, but the pain becomes worse, and he doesn't return for 5 more days. He then gives his medical bills to his employer for reimbursement. Based on these facts, should the workers compensation policy pay these medical bills
Yes, the employee notified the employer within 30 days of the injury
All of the following are requirements for applications for a Risk Manager license in Texas EXCEPT
Have at least 2 years of insurance experience
To become a Texas insurance agent, an individual must
Have passed a licensing exam within the 12 months before applying
If an insurer meets the state's financial requirements and is approved to transact business in the state, it is considered what type of insurer
Authorized
What type of insurance can be obtained through a surplus lines insurer
Coverage that is unavailable through authorized insurers
Injuries that occur when an employee is traveling to or from work are
Covered under workers compensation only when the means of transportation is paid for by the employer
All of the following would be considered rebating except
An agent misrepresents policy benefits to convince a policyowner to replace policies
Which of the following can qualify for a surplus lines license
Any of the above
All of the following must be true of an individual before a license can be issued EXCEPT that the
Applicant submitted his or her most recent tax return to the department
In Texas, how is the Commissioner of Insurance placed in office
Appointed by the Governor for a term of 2 years
A recent college graduate bought a new car and is trying to get automobile insurance on it as required by the lienholder. After being rejected by several insurance companies due to his driving record, he finally talked to an agent who can get him coverage. His agent called him a residual market risk. From which type of automobile insurance plan can the applicant purchase insurance
Assigned risk
Which members of a corporation or partnership are required to obtain an individual insurance agent's license in order for the association to be licensed
At least one officer or partner and nay other person acting as an agent
All of the following are considered unfair or deceptive acts in connection with the sale of insurance except
Attempting to settle a claim in which liability is clear
In insurance transaction, fiduciary responsibility means
Handling insurer funds in a trust capacity
Which of the following conditions would most likely be compensable under workers compensation
Carpal tunnel syndrome
Which of the following must an insurer obtain in order to transact insurance within a given state
Certificate of authority
Forcing a client to buy insurance from a particular lender as a condition of granting a loan is defined as
Coercion
When an individual obtains an insurance license for the primary purpose of writing insurance on him - or herself, or for members of his or her immediate family, or business, this is called
Controlled business
An insurance professional advises a client regarding the benefits of her life insurance policy, in exchange for a fee. Which of the following terms best describes this type of insurance professional
Counselor
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
Defamation
Which of the following actions is not in violation of the Unfair Claims Settlement Practices Act
Denying an unsubstantiated claim
Which of the following will not be considered unfair discrimination by insurers
Discriminating in benefits and coverages based on the insured's habits and lifestyle
Two individuals 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
Discrimination
When twin brothers applied for life insurance from Company A, the company found that while neither of them smoked and both had a very similar lifestyle, one of the twins was in a much stronger financial position than the other. Because of this, the company charged him a higher rate for his insurance. This practice is considered
Discrimination
The requirements that agents not commingle insurance monies with their own funds is known as
Fiduciary responsibility
All of the following would be considered an insurance transaction EXCEPT
Obtaining an insurance license
What is the major difference between a stock company and a mutual company
Ownership
Which of the following statements is INCORRECT with regard to surplus lines insurance
Policies written by a surplus lines insurer typically contain standard coverages and forms
Which of the following statements is incorrect with regard to surplus lines insurance
Policies written by a surplus lines insurer typically contain standard coverages and forms
Who might receive dividends from a mutual insurer
Policyholders
Pertaining to insurance, what is the definition of a fiduciary responsibility
Promptly forwarding premiums to the insurance company
Which of the following was created to pay benefits due to insureds after their insurance companies have been declared insolvent
Property and Casualty Insurance Guaranty Association
All of the following are true regarding rebates except
Rebates are allowed if it is in the best interest of the client
For which of the following actions can an agent's license be suspended or revoked
Rebates of premiums
Under the Texas Property and Casualty Insurance Guaranty Association, what is the maximum amount that a claimant may recover from an occurrence under a policy issued by an insolvent insurer
The lesser of the above amounts
An agent holds an insurance license in the state of Kansas and would like to transact insurance in Texas. The agent became licensed before written examinations were required. Therefore, the agent has not actually passed any kind of examination. Which of the following is true
The written examination requirement will be waived
An insurance agent wants for a client to replace her current annuities plan with another one. He presents the new one in an incomplete and dishonest way, which makes the new contract seem far more appealing than the original one. The policyowner ends up surrendering her original contract and replacing it with the new one. Which term best describes what the agent did
Twisting
If the death of an employee results from a compensable injury, the insurance carrier will pay
Up to $10,000 for the cost of burial