Insurance Regulation Flashcards
Who is exempt from the licensing requirement in this state?
Officers, directors, or employees of an insurer or of an insurance producer who do not receive commission on policies written or sold are exempt from licensing requirements.
What is the main purpose of a temporary license, and how long can it be in effect?
A temporary license may be issued for the continuation of business in the event of the provider’s death or disability, and it may remain in effect for 180 days.
What are continuing education requirements in this state?
Producers must complete 24 CE hours every 2 years, including 3 hours in ethics education, and 3 hours regarding state law changes.
How long does a producer have to notify the Director of a change of address?
Change of address must be reported to the Director within 30 days.
Upon what grounds can a license be suspended or revoked?
Willful violations of or noncompliance with Insurance Code or any other state and federal laws.
How long must insurance companies keep records of insurance transactions under the license for the Director’s examination?
At least 3 years.
If an agent’s appointment with the insurer is terminated, how long does the insurer have to notify the Director?
Within 30 days of appointment termination.
What is a “fiduciary”?
A fiduciary is a person legally appointed to hold assets for another person in the position of trust.
What constitutes rebating?
Rebating includes premiums payable on the policy, special favors or services, advantages in dividends or benefits, stocks, bonds, securities, and their profits (and similar inducements).
What is the purpose of the Fair Credit Reporting Act?
The act established procedures that consumer-reporting agencies must follow in order to ensure that records are confidential, accurate, relevant, and properly used. It also protects consumers against the circulation of inaccurate or obsolete information.
What is the difference between a consumer report and an investigative consumer report?
Investigative consumer reports are similar to consumer reports in that they also provide information on the consumer’s character, reputation, and habits. The primary difference is that the information is obtained through an investigation and interviews with associates, friends and neighbors of the consumer.
A temporary license is normally valid for
180 days.
A producer’s license must be renewed
Every year on the anniversary date of insurance.
Which of the following is a continuing education requirement in this state?
24 hours every 2 years
An agent who offers a cash reward to a prospect for buying a policy is guilty of
Rebating
Insurance producers must report their change of business or residence address within
30 days.
Insurance sold by agents only to family members, relatives, and employees is
Controlled business.
An agent who deliberately makes a malicious statement about another insurance company is guilty of an illegal trade practice called
Defamation.
Who is considered a nonresident agent?
An agent who resides in another state, but is licensed to write insurance in this state.
Which of the following would be required to be licensed as an insurance producer?
A salaried employee who solicits insurance.
An applicant is denied insurance because of information found on a consumer report. Which of the following requires that the insurance company supply the applicant with the name and address of the consumer reporting company?
Fair Credit Reporting Act.
What is the main purpose of requiring licenses for person who transact insurance?
To protect the general public.
Within what maximum time period can a producer reinstate a lapsed license without having to retake a written examination?
12 months.
All of the following are unfair claims settlement practices EXCEPT
Suggesting negotiation in settlement the claims.
If the Director issues a cease and desist order, that means the insurer must
Stop committing a particular violation.
If the Director requests information regarding a claim, within how many must the insurer provide a response?
21 days.
