Alabama Laws & Regulations

Question 1

The Commissioner must hold a hearing within _____ days after receipt of demand from an aggrieved person.

Answer 1

30 days

Question 2

The Commissioner will conduct an examination of every domestic insurer at least once every ______ years.

Answer 2

5 years

Question 3

What is the minimum age to obtain a producer’s license?

Answer 3

18 years old.

Question 4

The Commissioner may issue a 1) __________, for a maximum of 2) ________ months to a surviving spouse, business partner, or employee if a producer 3)______, 4) becomes _______, or 5) ________.

Answer 4

1) . Temporary producer license
2) 6 months
3) dies
4) disabled
5) called to military service

Question 5

The criminal fine for insurance code violations are up to $_____ for each intentional violation.

Answer 5

$1,000 for each intentional violation.

Question 6

1) _______ OR 2) _______ CIVIL violations that could also result in suspension or revocation of license.

Answer 6

1) Producer OR

2) Service Representative

Question 7

Amount of fine for each CIVIL violation is up to $_____ for each violation.

Answer 7

$10,000

Question 8

30 days is the time frame to report 1) _______ 2) ______, or 3)________ to 4) _______.

Answer 8

1) Change of address
2) Administrative actions
3) Criminal charges
4) Commissioner

Question 9

Producer insurance transaction records must be retained for at least how long?

Answer 9

3 years

Question 10

1)______ hours of CE is required every 2)_______.

Answer 10

1) 24 hours

2) 2 years

Question 11

Every two years, _____ hours of CE credit is required, which must include ____ hours on _____ OR _______.

Answer 11

1) 24 hours
2) 3 hours
3) ethics
4) business practices

Question 12

Appointment of Producer: An 1) ______ must file a notice of appointment within 2) _____ days of the 3) ______ OR 4) __________.

Answer 12

1) Insurer
2) 15 days
3) Agency contract date OR
4) FIRST insurance application.

Question 13

An insurer that terminates an appointment must notify 1) _______ within 2)_____ days.

Answer 13

1. The Commissioner

2. 30 days

Question 14

Binders are valid up to ____ days OR until ________, whichever is ______.

Answer 14

1. 90 days
2. the policy is issued
3. shorter

Question 15

The Insurance Guaranty Association’s maximum liability per covered claim is 1)________ for workers’ compensation claims.

Answer 15

1. Full amount

Question 16

The Insurance Guaranty Association’s maximum liability per covered claim is $_______ for all covered claims except workers’ compensation claims.

Answer 16

$150,000 for all covered claims EXCEPT for workers’ comp claims which is the FULL AMOUNT for each covered claim.

Question 17

Notice of cancellation for Automobile Insurance is 1) ____ days before effective date of 2) _____________.

Answer 17

1) 10 days

2) cancellation for nonpayment of premium

Question 18

Notice of cancellation for Automobile insurance is 1) _____ days before effective date of cancellation for all reasons other than 2) ______.

Answer 18

1) 20 days

2) for all reasons other than cancellation for nonpayment of premium which is 10 days.

Question 19

The minimum bodily injury limits for Uninsured/underinsured motorist insurance 1)$________ per person and 2)$_______ per accident.

Answer 19

1) . $25,000 per person

2) $50,000 per accident

Question 20

Stacking of limits is allowed up to _______ vehicles, IF ______________________.

Answer 20

3 vehicles IF multiple cars are insured ON THE SAME POLICY.

Question 21

MINIMUM AUTO LIABILITY LIMITS:

1) $25K for ________
2) $50K for ________
3) $25K for _______

Answer 21

1) Bodily injury or death per person in any one accident.
2) Bodily injury or death to 2 or more persons in any one accident.
3) Damage to property of others in any one accident.

Question 22

Accident Prevention Course: 1) ______ operator must be age 2)_____ or older AND 3)_________________ to receive accident prevention course discount.

Answer 22

1. Principal operator
2. 55 or older
3. Successfully complete an accident prevention program

Question 23

For workers’ comp, laws are mandatory for employers with ___ or more employers.

Answer 23

5 or more covered employees

Question 24

TTD and PTD is ____% of the employee’s _____ subject to a maximum and minimum weekly compensation.

Answer 24

1. 66.67%

2. AWW

Question 25

TPD and TTD benefits are paid during the period of disability, but not beyond ____ weeks.

Answer 25

300 weeks

Question 26

WC burial expenses are paid up to $_______.

Answer 26

$6,500

Question 27

The workers’ comp laws are mandatory for employers who employ 5 or more covered employees in any one business, except:

1) _____
2) _____
3) _____

Answer 27

1) . domestic employees;
2. farm laborers; or
3. persons whose employment is casual and not in the usual course of the employer’s business or profession.

Question 28

Surplus lines insurance may be obtained from unauthorized insurers subject to the following conditions:

1. ___
2. ___
3. ___

Answer 28

1. The insurance must be obtained through a licensed surplus lines producer.
2. The full amount of insurance required must not be obtainable from authorized insurers after diligent effort.
3. The insurance must not be obtained for the purpose of securing advantages for a lower premium rate than that accepted by an authorized insurer.

Question 29

Within 1)____ days after the effective date of any surplus insurance, the surplus lines producer must file a 2)_________.

Answer 29

1. 30 days
2. Written report of the transaction stating the facts to determine if the coverage has been lawfully placed as a surplus line.

Question 30

Who may obtain a surplus lines producer license?

Answer 30

Any person licensed as a resident insurance producer for PROPERTY insurance who has had sufficient experience in the insurance business may be licensed as a surplus lines producer.

Question 31

An applicant for a surplus lines producer license must:

1. ______
2. _____
3. _____

Answer 31

1. Submit a license application
2. Submit a license fee
3. File a $50K bond

Question 32

A licensed surplus lines producer may accept and place surplus lines business for a 1)________ and may 2)_______.

Answer 32

1. licensed insurance producer

2. may compensate the producer.

Question 33

An automobile policy in force 60 days or more may only be cancelled for specific reasons, such as:
1. 
2.
3.
4.
5.
6.
7.

Answer 33

1. nonpayment of premium
2. material misrepresentation
3. violations of policy terms and conditions
4. failing to disclose motor vehicle accidents and moving traffic violations for the preceding 36 months IF ASKED IN THE APPLICATION
5. making a false or fraudulent claim
6. the named insured (or any other resident operator) driver’s license suspended or revoked within 36 months prior to cancellation notice; and,
7. conviction during the preceding 36 months for any felony, criminal negligence resulting in death, homicide, or assault arising out of the operation of a motor vehicle; and operating a motor vehicle while intoxicated or under the influence of drugs.

Question 34

Written notice of cancellation of an automobile policy must be provided at least:

1. ___ OR
2. ___

Answer 34

1. 10 days in advance if due to nonpayment of premium; OR

2. 20 days in advance for all other reasons

Question 35

Automobile polices must include uninsured motorist and underinsured motorist coverages, unless ______.

Answer 35

Unless the coverage(s) is rejected in writing by the insured.

Question 36

The maximum Alabama Insurance Guaranty Association benefits per covered claim are the following:
1.
2.

Answer 36

1. The full amount of covered WC claims

2. For all other claims, the amount of each covered claim that is in excess of $100 and is less than $150,000.

Question 37

What is “twisting”?

Answer 37

The illegal replacement practice of misrepresenting a policy to induce a policyholder to lapse, forfeit, or surrender an existing policy and purchase a new policy from a different insurer.

Question 38

T/F: A person may issue or deliver agency company stock in a corporation or an advisory board contract as an inducement to insurance.

Answer 38

False: Cannot issue or deliver stock, shares, benefit certificates or any other capital in any common law corporation of any kind promising returns and profits as an inducement to insurance. `

Question 39

Any insurer making a false annual or other statement required and individuals making oath and subscribing to the false statement will be fined between $____ and $____.

Answer 39

$500 and $5000.

Question 40

No licensee may divide or share commissions with others, except ______

Answer 40

Except that a producer may divide or share commissions with other producers who are licensed for the same kinds of insurance.

Question 41

DOMESTIC ABUSE INSURANCE PROTECTION ACT: To recover for a P&C claim under this provision, the innocent coinsured is required to do one of the following two things:

Answer 41

1. File a complaint under these provisions against the abuser for the act causing the loss and not voluntarily dismiss the complaint. OR
2. Seek a warrant for the abuser’s arrest for the act causing the loss and cooperate in the prosecution of the abuser.

Question 42

The Domestic Abuse Insurance Protection Act does not prohibit a property or casualty insurer from nonrenewing cover for the subject of if, after a claim, the subject of abuse 1._______ or 2. _________.

Answer 42

1. remains married to OR

2. continues to reside in the same household with the abuser.

Question 43

The fact amount of insurance provided by an industrial fire policy covering buildings and other structures or contents under the same ownership may not exceed 1.______ for a weekly policy.

Answer 43

1. $7,500

Question 44

For a monthly industrial fire policy, the maximum face amount covering a building or dwelling is 1._______ and for contents 2.$_______.

Answer 44

1. 40K for building or dwelling
2. 20K for contents

Notes: An insurer may not issue both a weekly and a monthly industrial fire policy covering the same property.

-The fire policy provisions does not prohibit a company from applying to write greater amounts if the rating plan is approved by the Insurance Department.

Question 45

An insurer issuing an industrial fire policy may not use the caption “___________”

Answer 45

“The Standard Fire Policy”

Question 46

When a policy designation is made for an industrial fire policy, the words 1._______, 2. _______, 3. _______, or 4.________ must be part of the caption.

Answer 46

1. industrial
2. monthly
3. weekly premium
4. home service