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Georgia Insurance License > Laws And Rules > Flashcards

Laws And Rules Flashcards

1
Q

Foreign Insurance Company

A

A company that formed under the laws of another state

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2
Q

Which are NOT managed care organizations?

a) Preferred Provider (PPO)
b) Health Maintenance (HMO)
c) Medical Information Bureau (MIB)
d) Point-of-Service Plan (POS)

A

c) Medical Information Bureau (MIB)

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3
Q 
Information obtained from a phone conversation to the proposed insured can be found on these reports:
A) Agent’s Report
B) Inspection Report 
C) MIB Report 
D) Physicians Report
A

B) Inspection Report

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4
Q

Which of the following is NOT considered rebating?
A) sharing commissions with an agent licensed in the same line of business
B) returning premium to a client as an inducement for purchasing a policy
C) giving some thing of value to an insured and exchange for their business
D) offering special dividends

A

A) Sharing commissions with an agent licensed in the same line of business

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5
Q

What is the reason for the establishment of rules governing life insurance and annuity replacements?
A) Lessen the chance for misrepresentation and incomplete disclosure
B) Regulate insurance rates
C) Protect the interests of the insurer
D) Protect the interests of the beneficiary

A

A) Lessen the chance for misrepresentation and incomplete disclosure

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6
Q

Why would the Commissioner examine an insurers records?
A) to determine the solvency of the insurer.
B) to determine claims rate of the insurer.
C) to approve rate increase by the Lessen the chance for misrepresentation and incomplete disclosure insurer
D) to determine the AM Best rating of the insurer

A

A) To determine the solvency of the insurer

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7
Q 
All agents licensed less than 20 years are required to complete \_\_\_ continuing education hours every two years.
A. 12 
B. 16 
C. 24 
D. 30
A

C. 24

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8
Q 
In Georgia, monthly premium accident and sickness insurance policies must provide a grace period of at least
A. 7 days 
B. 10 days 
C. 14 days 
D. 31 days
A

D. 31 days

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9
Q

When is a group accident and health policy required to provide coverage for a newborn child?
A. When the policy owner notifies the insurance company
B. At the moment of birth
C.When the required additional premium is paid.
D. No more than 10 days after date of birth

A

B. At the moment of birth

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10
Q 
Which of the following is the minimum age at which an individual can sign a life insurance application
A. 15
B. 18
C. 19
D. 21
A

A. 15

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11
Q 
All accident and sickness plans must provide coverage on a newborn child for \_\_\_\_\_ days
A. 7
B. 10
C. 25
D. 31
A

D. 31

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12
Q 
The act of an insurance company publishing misleading information about its policies provisions is called?
A. Coercion
B. False advertising 
C. Twisting 
D. Intimidation
A

False advertising

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13
Q

Coercion

A

the practice of persuading someone to do something by using force or threats.

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14
Q 
As a condition for a loan, a bank requires the borrower to purchase credit insurance from a specific company. What is the bank guilty of?
A. Coercion
B. Defamation 
C. Rebating
D. Misrepresentation
A

A. Coercion

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15
Q

Defamation of insurer

A

It is an illegal practice to make any public statement or advertisement that contains false information or unsubstantiated criticisms about an insurance company

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16
Q

An example of false advertising would be
A. Written testimony from a celebrity spokesperson
B. And insurer exaggerating its dividends in a magazine advertisement
C. An agent giving a gift as an inducement for their business
D. And insurer advertising in an insurance trade journal

A

B. And insurer exaggerating its dividends in a magazine advertisement

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17
Q 
Which type of insurance company allows their policy owners to elect a governing body?
A. Stock
B. Mixed
C. Admitted
D. Mutual
A

D. Mutual

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18
Q

Nonprofit life insurance providers that are covered by a special section in the Georgia insurance code are called
A. Fraternal life insurance organizations
B. Domestic life insurance organizations
C. Unauthorized insurers
D. Mutual life insurers

A

A. Fraternal life insurance organizations

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19
Q

Defamation occurs when an agent makes a false statement intended to
A. Malign another insurer
B. Replace an existing insurance policy with another
C. Restrict fair trade
D. Miss represent the provisions of an insurance policy

A

A. Malign another insurer

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20
Q

Malign

A

To speak ill of

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21
Q 
In Georgia, an insurers license to conduct business in Georgia, but domiciled in New Jersey, is called a
A. Non-admitted Company
B. Foreign company
C. Domestic company
D. Alien Company
A

B. Foreign company

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22
Q 
In Georgia, most life insurance policies have a contestability period of
A. 1 year
B. 2 years 
C. 3 years 
D. 5 years
A

B. 2 years

23
Q 
Who is a mutual insurance company owned by?
A. Its Board of Directors
B. Its policyholders
C. The state of Florida 
D. Its employees
A

B. Its Policyholders

24
Q

Which of the following is NOT an unfair claims settlement practice?
A. Failing to acknowledge and act promptly with respect to an insurance claim
B. Compelling an insured to initiate a lawsuit by offering less on an insurance claim
C. Failing to accept or deny a claim within reasonable time after proof of loss is submitted
D. Needing written documentation of claim details

A

D. Needing written documentation of claim details

25
Q 
When advertising, an insurer is required to use its
A. Logo
B. True corporate name
C. Trademark
D. Trade name
A

B. True corporate name

26
Q

Prior to a hearing that could potentially revoke an agents license, what is required by the Commissioner?
A. Giving oral notice to the agent
B. Giving written notice to the agent
C. Giving both oral and written notice to the appointing insurer
D. Giving oral notice to the appointing insurer

A

B. Giving written notice to the agent

27
Q 
In Georgia, and insurance company must notify the commissioner within \_\_\_\_\_ days to terminate an agency appointment.
A. 30
B. 45
C. 60
D. 90
A

A. 30

28
Q 
The coordination of benefits  (COB) provision exist in order to
A. Avoid duplication of benefit payments
B. Avoid excessive hospitalization
C. Lower insurance premiums
D. Maximize patient care
A

A. Avoid duplication of benefit payments

29
Q

Which organization was established to provide funds to protect an insured in the event of an insurer’s insolvency?
A. National Association of insurance commissioners (NAIC)
B. Georgia life and health insurance guaranty Association
C. Department of insurance
D. Office of insurance regulation

A

B. Georgia Life and Health Insurance Guaranty Association

30
Q

Who would be eligible for a temporary license issued in Georgia?
A. An agent visiting Georgia to write a policy
B. An agent to sell a policy from a company with which the agent is not appointed
C. The personal representative of a deceased agent to provide service to existing policy owners
D. A minor servicing a parent’s existing policy owners

A

C. The personal representative of a deceased agent to provide service to its existing policy owners

31
Q 
During the application process, the agents primary responsibility is to
A. The commissioner
B. The applicant
C. The insurance company
D. The state of Georgia
A

C. The insurance company

32
Q 
A producer must notify the commissioner within \_\_\_\_ days of an address change
A. 15
B. 30
C. 45
D. 60
A

B. 30

33
Q 
Who owns a stock company?
A. Its policyowners
B. Its stockholders 
C. Its Board of Directors 
D. Its CEO
A

B. Its stockholders

34
Q 
T is an agent and when hired, is reminded that he has a responsibility to handle clients’ funds and an honest and ethical manner. This responsibility is referred to as
A. Fiduciary responsibility
B. Reasonable trust
C. Ethical behavior
D. Legal competence
A

A. Fiduciary responsibility

35
Q 
In Georgia, long-term care policies are required to provide benefits for at least
A. 6 months
B. 12 months
C. 18 months
D. 24 months
A

B. 12 months

36
Q 
How often is an insurance agent license to be renewed in Georgia?
A. Every six months
B. Each year
C. Every two years
D. Every three years
A

C. Every two years

37
Q

An agent would be guilty of rebating by
A. Returning a portion of a premium as incentive to purchase insurance
B. Canceling a clients insurance policy without cause
C. Selling direct marketing products
D. Offering temporary insurance coverage

A

A. Returning a portion of a premium as incentive to purchase insurance

38
Q

The life and health insurance guaranty Association is
A. An entity that exists in underwriting large insurance policies
B. Funded by admitted insurance companies through assessments
C. Funded by the state government
D. Administered by the federal government

A

B. Funded by admitted insurance companies through assessments

39
Q

An example of an unfair claims settlement practice is
A. Making it mandatory that proof of loss be provided for each claim
B. Requiring a time limit for submitting a claim
C. Paying a claim in a timely manner
D. Turning down a claim without providing the basis of denial

A

D. Turning down a claim without providing the basis of denial

40
Q

Which of the following is considered to be misrepresentation?
A. Replacing an existing policy with a new one
B. An agent guaranteeing a policy is dividends
C. Sharing commissions with other licensed agents
D. Representing a foreign insurer

A

B. An agent guaranteeing a policy’s dividends

41
Q

A mutual insurance company and a stock insurance company have one main difference between them. What is this major contrast?
A. Stock company is regulated by the state where it’s incorporated. Mutual company is regulated by its policyholders.
B. Stock company is considered an authorized insurer. Mutual company is considered an unauthorized insurer.
C. Stock company is owned by its policyholders. Mutual company is owned by its shareholders.
D. Stock company is owned by a shareholders. Mutual company is owned by its policyholders.

A

D. Stock company is owned by a shareholders. Mutual company is owned by its policyholders.

42
Q

What would be an accurate definition of “controlled business”?
A. Insurance business that is written on an agent on life property or interests
B. Insurance business obtain by an agent through coercion, intimidation, or boycotting
C. Insurance business that is obtained through false advertising
D. Insurance business that is obtained by replacing an existing policy through misrepresentation

A

A. Insurance business that is written on the agents on life, property, or interests

43
Q 
An agent must have blank hours of ethics per continuing education reporting period?
A.  0
B. 1
C. 2 
D. 3
A

D. 3

44
Q

What is the purpose of the life and health insurance guaranty Association?
A. Enforces Georgia‘s insurance regulations
B. Underwrites high risk insurance applicants
C. Protects policy owners against insolvent insurance companies

A

Protects policyowners against and solvent insurance companies

45
Q

A person who is required to be a licensed agent would be?
A. Underwriter
B. Officer who makes decisions on the financial direction of the insurer
C. Person who places insurance on behalf of anyone seeking insurance
D. Administrator working in the marketing department who does no selling

A

Person who places insurance on behalf of anyone seeking insurance

46
Q 
Using an existing life insurance policies cash value to purchase another policy with the same insurer for the sole purpose of earning additional commissions is called?
A. Rebating
B. Twisting
C. Misrepresentation
D. Churning
A

Churning

47
Q 
The commissioner must give \_\_\_\_ days notice prior to holding a hearing regarding an agents unfair or deceptive practice.
A. 10
B. 15
C. 20
D. 30
A

10

48
Q

In Georgia, which of the following statements is correct about life insurance advertisements?
A. An insurance agency is responsible for advertisements placed by its insurance agents
B. The commissioner of insurance must approve advertisements before they are used
C . Third-party testimonials may not be used
D. The dividends may be represented as guaranteed

A

An insurance agency is responsible for advertisements placed by its insurance agents

49
Q 
In Georgia, an accident and sickness policy that is paid on a quarterly basis requires a grace period of? 
A. 7 days
B. 10 days 
C. 31 days 
D. 45 days
A

31 days

50
Q

A domestic insurance company in Georgia is considered a company?
A. Only sells to Georgia residence
B. Exclusively does business in Georgia
C. Is incorporated & formed in Georgia
D. Is licensed to issue direct mail order coverage

A

Is incorporated & formed in Georgia!

51
Q 
What is NOT a requirement for becoming a licensed agent in Georgia?
A. Complete a pre-licensing course
B. Resident of Georgia
C. Be at least 18 years old
D. High school graduate
A

High school graduate

52
Q

Upon reaching the limiting age, a handicapped child can extend their accident and sickness insurance coverage as a dependent?
A. Only if the child is incapable of employment and chiefly dependent on the policy owner
B. For up to an additional 10 years only
C. Only if physically disabled
D. Only if mentally disabled

A

Only if the child is incapable of employment & chiefly dependent on the policy owner

53
Q

The purpose of the rules governing advertisement of life insurance and annuities is?
A. Set advertisement rates for all insurers
B. Assures full disclosure to the Public of all the material& irrelevant information
C. How drive sales quotas for the insurers
D. Provide a potential client with all the consumer ratings for the insurer

A

Assure Full disclosure to the Public of all materials & relevant information

54
Q

And insurance agent is in violation of the rules governing advertisement of life insurance and annuities if the agent takes which of the following actions during a sales presentation?
A. Asks prospects for referrals
B. Analyzes another insurance company’s policy
C. Refers to guaranteed policy dividends
D. Compares the costs of two similar policies

A

Refers to guarantee policy dividends

Georgia Insurance License (10 decks)

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