General Insurance

Question 1

All of the following are included as definitions of “transact” as applied to insurance EXCEPT:

Answer 1

Underwriting

Question 2

Which is considered nonpublic personal information as defined by the California Financial Code?

Answer 2

Tax return

Question 3

Which of the following terms refers to any evidence or documentation in the possession of the insurer that provides any evidence of a claim and that reasonably supports the magnitude or the amount of the claimant loss?

Answer 3

Proof of claim

Question 4

An “insurance agent” means a person authorized, by and on behalf of an insurer, to transact which of the following class of insurance?

Answer 4

Annuities

Question 5

When can a person act as an agent of the insurer?

Answer 5

When the insurer has filed with the commissioner a notice of appointment

Question 6

ALL of the following are TRUE regarding the process to change the California Code of Regulations EXCEPT:

Answer 6

The Office of Administrative law (OAL) may substitute its own judgment for that of the rule-making agency

Question 7

A policy shall specify all of the following EXCEPT

Answer 7

the method in which the coverage amount was calculated.

Question 8

All of the following define insolvency EXCEPT

Answer 8

Revocation of certificate of authority by the commissioner

Question 9

What is the maximum fine for a person who transacts insurance without a valid license?

Answer 9

$50,000 and/or imprisonment for period not exceeding one year

Question 10

Which of the following is a party to a contract of insurance bound to communicate EXCEPT

Answer 10

Those which the other would know by retaining a consultant with specialized knowledge in insurance matters

Question 11

Which of the following actions is considered part of the insurance sales process?

Answer 11

Transaction of matters subsequent to execution of the contract and arising out of it.

Question 12

If fiduciary funds are received by any licensee, the funds shall be maintained in any of the following EXCEPT

Answer 12

bonds issued in all 50 states of the United States

Question 13

How is an insurance policy defined

Answer 13

The written instrument, in which a contract of insurance is set forth.

Question 14

According to the Administrative Procedures Act, what is required to make changes to the California Insurance Code?

Answer 14

The Department of Insurance is required to publish proposed changes at least 45 days prior to the hearing or decision to adopt the change

Question 15

where shall an express warranty be made?

Answer 15

in the policy itself

Question 16

which of the following is TRUE regarding advertisements or printed matter used by an agent or broker?

Answer 16

The printed material must accurately show the relationship between the agent or broker and the agency

Question 17

When may a surplus line broker solicit and place insurance for a home state insured with a nonadmitted insurer?

Answer 17

if the same insurance coverage cannot be procured from an admitted insurer

Question 18

when should an agent provide an applicant the effective date of coverage, if known, or the circumstances under which coverage will be effective?

Answer 18

at the time of application or receipt of premium

Question 19

As used in the insurance code, the word “shall” is mandatory and the word “may” is permissive EXCEPT

Answer 19

Unless otherwise apparent from the context

Question 20

A claimant can be any of the following EXCEPT

Answer 20

a person who is conducting an investigation of a claim on behalf of an insurer

Question 21

Which is TRUE regarding a life and health agent who has not been specifically appointed by the insurer?

Answer 21

If a policy is issued, the insurer is considered to have authorized the agent to act on its behalf

Question 22

An agent or representative who issues long term care insurance mudt do all of the following EXCEPT

Answer 22

Complete a total of 10 hours of continuing education if licensed before January 1st, 2002

Question 23

Which circumstances in a pretext interview determine if the questions are permissible?

Answer 23

When an insured is consulted by a person who hide his true identity on purpose when fraud for a claim is suspected

Question 24

which of the following provisions of free insurance offered as an incentive to purchase or rent property is TRUE?

Answer 24

It requires a separate charge or fee.

Question 25

What does concealment, whether intentional or unintentional, entitle the injured party to?

Answer 25

The insurer may rescind the contract on the basis of misrepresentation, concealment or fraud by the insured

Question 26

All of the following are requirements for an agent who advertises and transacts business on the Internet EXCEPT

Answer 26

his or her most recent license and appointment date

Question 27

When should an insurer provide for the continuous operation of a unit or division to investigate possible fraudulent claims?

Answer 27

if admitted to do business in this state, except those otherwise exempted

Question 28

Which of the following is the method wherein a contract of insurance is finalized as relates to the sales process?

Answer 28

execution of a contract of insurance

Question 29

Which is an INACCURATE statement regarding a life settlement contract?

Answer 29

The loan proceeds are used to solely pay premiums for the policy and any expenses incurred.

Question 30

whether admitted or nonadmitted, how does a “foreign” insurer differ from an “alien” or “domestic” insurer?

Answer 30

A “foreign” insurer is organized under the laws of another state within the United States

Question 31

Which are assets that are in excess of an insurer’s liability for reported losses, expenses, taxes, and reinsurance of outstanding risks?

Answer 31

paid-in capital

Question 32

Insurance is which type of contract?

Answer 32

One agrees to indemnify against loss, damage or liability arising from a contingent or unknown risk.

Question 33

All of the following are a duty of an insurer in regards to claims on file and record documentation EXCEPT

Answer 33

Maintaining any sales material, which had a material impact on the claims process.

Question 34

According to CIC Section 1711, an organization ceases to exist as an entity eligible to hold a license EXCEPT

Answer 34

upon the termination of all contacts

Question 35

All of the following are examples of representation EXCEPT

Answer 35

it may be altered after the insurance is effected

Question 36

When working on behalf of an insurer for which they are not specifically appointed, what may a licensed agent do?

Answer 36

present a proposal for insurance and transmit an application to the insurer

Question 37

How does an “admitted” person differ from an “nonadmitted” person, as it pertains to insurance?

Answer 37

An “admitted” person has the right to transact insurance business within the state, while a “nonadmitted” person is not entitled to this action.

Question 38

Which group of people is offered additional protection by the Unfair Practices Act the regulates trade practices in the business of insurance?

Answer 38

Survivors of the Holocaust