*4 TB - Insurance Regulations Flashcards
The responsibility of the federal government in regulating the insurance industry is limited to:
Monitoring the ethical conduct of individual insurance adjusters
Fair labor standards and anti-trust matters
Monitoring financial solvency of insurance companies
Reviewing and approving rates, polices, and forms
Fair labor standards and anti-trust matters!
The responsibility to regulate the insurance industry belongs to:
I. The state government
II. The federal government
III. The state insurance department
I only
III only
I and II only
I, II, and III
I and II only
Both federal and State government regulate the insurance industry
An insurance company that is formed and domiciled under the laws of a particular state is an example of a (n):
Domestic Insurer
Foreign Insurer
Domiciled Insurer
Alien Insurer
Domestic Insurer
Which of he following is a requirement for obtaining an agents or adjusters license?
Must be 21 years of age
Must have completed at least two years of college course work
Must have an insurance producers license in the state
Must satisfy the insurance commissioners of trustworthiness
Must satisfy the insurance commissioners of trustworthiness
The unethical act of persuading a policy owner to drop a policy so key for the purpose of selling another policy is known as:
Twisting
Rebating
Defamation
Misrepresentation
Twisting
An insurer that refuses to pay claims without conducting a reasonable investigation based upon all available information is guilty of:
Twisting
Unfair claim settlement practices
A felony
Misrepresentation
Unfair claim settlement practices
An insurer that distributes a statement that misrepresents the benefits, advantages, conditions, or terms of any insurance policy would be guilty of:
Unfair claim settlement practices
Misrepresentation and false advertising
Defamation
Coercion
Misrepresentation and false advertising
Should an agent or adjusters have a change of address, the obligation to notify the insurance department lies with:
I. The company that employs the adjuster or company that appoints the agent
II. The licensee
III. The licensee’s Supervisor
I and II
I only
II only
I, II, and III
II only
An incorporated insurance company with its capital divided into shares is the definition of:
A mutual company
A domestic company
A stock company
A foreign company
A stock company
The insurance dept has been advised that an agent is guilty of an insurance code violation. The commissioner will:
Call for a hearing
Revoke the license pending a hearing
Revoke the license
Fine the agents insurance company
Call for a hearing
Which of the following would be considered an Unfair Trade Practice?
Twisting
Rebating
Coercion
All are Unfair Trade Practices
All are Unfair Trade Practices
Which of the following is NOT considered to be an unfair claims practice?
Misrepresenting pertinent facts or uninsured policy provisions relating to coverages at issue
Refusing to pay a claim without conducting a reasonable investigation based upon all available information
Attempting to settle claims on basis of an application that was altered without notice to or the knowledge of the insured
Failing to honor an uncovered claim
Failing to honor an uncovered claim
Although their liability is clear, B.B.S., Insurance company routinely delays all claim payments for 90 days, and in doing so:
Avoids a lot of little nuisance claims
Substantially eliminates fraudulent claims
Is guilty of an unfair claim settlement practice
Avoids any acts of illegal discrimination between claimants
Is guilty of an unfair claim settlement practice
Which of the following would be considered unfair or deceptive acts by an adjuster?
Requesting that a first party claimant signs a release that extends beyond the subject matter which gave rise to the claim payment.
Advising the claimant the their rights may be impaired if a form of release is not completed within a specified period of time unless for the purpose of notification of statue of limitations.
Issuing check or draft, in a partial settlement of a loss or claim under specific coverage that contains language that releases the insurer or insured from total liability
All of the above
All of the above
A act of terrorism must be “certified” to be such an act by:
The president of the United States
The senate
The House of Representatives
The secretary of the treasury
The secretary of the treasury
All of the following events are considered acts of terrorism, except:
Acts of riot and civil commotion
Acts considered dangerous to human life, property or infrastructure
Acts resulting in damage within or outside the United States
Acts committed by an individual or individuals acting on behalf of any foreign person or foreign interest
Acts of riot and civil commotion
In order to be certified as an act of terrorism under the Federal Terrorism Act, property and casualty losses must exceed _______ for any one event:
$500,000
$1,000,000
$3,000,000
$5,000,000
$500,000
Is the treshold for the act to apply
None of the following can be covered by the Federal Terrorism Act insurance program, except:
Most commercial property and casualty risks
Federal crop insurance
Personal insurance policies
Health and Life insurance policies
Most commercial property and casualty risks
These can be covered
No act will be certified by the secretary as an act of terrorism under the federal terrorism act if:
The act is not committed as part of the course of war declared by congress
The act is one of terrorism is defined by the act
The losses that occur relate to commercial property risks
The losses that occurs relate to life insurance
The losses that occurs relate to life insurance
All of the following are considered acts of rebating, except:
An agent provides all-expenses paid cruise to a client and his wife in exchange for writing the coverage on his national chain of restaurants
An agent sends holiday greeting cards to all the clients on his mailing list
An adjuster receives a monthly check from an auto body repair shop for recommending the repair shop to clients who have a claim
All of the these situations are considered acts of rebating
An agent sends holiday greeting cards to all the clients on his mailing list
Under the extension of the Terrorism Risk Act of 2007 the federal government will share in the losses for a certified act of terrorism if:
Total losses for all insurer exceed $100 million dollars
An insurer is responsible for the first 20% of losses as a detectable, and then the government will pay 85% of remaining claim amounts
All of the above
All of the above
The federal law enacted to control the ways financial institutions and insurance companies deal with the private information of individuals is:
The FAIR plan
The Gramm-Leach-Bliley Act
The CAN-Spam Act
the Fair Credit Reporting Act
The Gramm-Leach-Bliley Act
