multi choice cards Flashcards
Which of the following is NOT a duty of the Director of Insurance?
Regulate the affairs of the Department of Insurance
Conduct hearings
Create Missouri insurance laws
Prescribe forms and procedures
The Director of Insurance does not create insurance laws. Instead, the Director has the authority to make any rules necessary to enforce the insurance laws of this state. State laws are enacted by the state legislature.
Which of the following is NOT a penalty for refusing to testify in a Department hearing?
Being held in contempt
Being required to appear before the Director
Being assessed a civil penalty up to $5,000 per violation
Being ordered to testify in circuit court
Being assessed a civil penalty up to $5,000 per violation
The circuit court may impose a civil penalty up to $50,000 for each violation.
If disciplinary action against a producer resulted in monetary relief of $200 or less, the producer's record will be expunged after \_\_\_\_\_ years. 3 5 7 10
5, All records of disciplinary actions against an insurance producer that result in forfeiture or other monetary relief of $200 or less, and place no other legal duty upon the producer, will be expunged after 5 years.
The Director may conduct a financial examination of an insurer whenever necessary but no less often than every \_\_\_\_\_ years. 3 5 7 10
5, The Director or any authorized examiners may conduct an examination of any company as often as is deemed appropriate, but a financial examination of every insurer licensed in Missouri must be conducted at least once every 5 years.
Which of the following is true about the Missouri insurance cease and desist order?
It is the only method used to prevent an insurance unfair trade practice
Violation may result in a minimum fine of $100,000
Any collected fine provides relief to mistreated consumers
An alternative to a cease and desist order is federal court action
Any collected fine provides relief to mistreated consumers
Money received from the Director’s enforcement proceeding and imposition of penalties is placed in a “Consumer Restitution Fund,” used to provide relief to mistreated consumers.
Within how many days must an insurer notify the Director it has appointed a producer? 15 30 45 60
30
Which of the following statements about producer licenses is TRUE?
Resident producer licenses renew every 2 years
Resident and nonresident producer licenses renew every 3 years
Surplus lines licenses renew every year
Nonresident surplus lines licenses are not issued in Missouri
Resident producer licenses renew every 2 years in Missouri.
Which of the following is NOT a qualification for obtaining an insurance producer license?
Being at least 18 years old
Paying a $200 license fee
Passing a licensing exam
Not committing a prohibited act
Paying a $200 license fee
The producer license fee is $100.
How many hours of approved continuing education must Missouri insurance producers complete during a license renewal period? 10 12 14 16
16
When must a producer notify the Director of any change in legal address? Never Within 15 days Within 30 days Within 90 days
Within 30 days
A producer’s license may be revoked for all of the following reasons, except:
Knowingly violating a state insurance law
Being convicted of a crime involving moral turpitude
Learning another producer stole money
Having an insurance license suspended in another state
Learning another producer stole money
In order to have a license suspended, the producer must be personally guilty of misappropriating money belonging to an insured or insurer.
If the Department of Insurance denies a producer license application, the applicant may request a hearing within how many days of the denial? 15 30 45 60
30
Making a false statement about the benefits or the nature of an insurance policy is what unfair trade practice?
Misrepresentation
Defamation
Twisting
Unfair discrimination
Making any false statement about the benefits or true nature of an insurance policy is misrepresentation.
A producer is guilty of what unfair trade practice when making a derogatory statement about a competing insurer’s financial condition?
Intimidation
Defamation
Coercion
Twisting
Defamation is making a false or maliciously critical statement regarding the financial condition of any person, with the intent to injure such person.
Under Missouri law, what standard of care and conduct is required of producers when receiving money from, or on behalf of, insurers or policyholders?
Legal capacity
Care of a trustee
Fiduciary responsibility
Financial duty
Producers have fiduciary responsibilities to both their insurers and clients under Missouri insurance code
All of the following are true about personal insurance transactions, except:
The producer must inform the applicant within 30 days if no insurer can be found to issue coverage
The producer may use any professional designation to instill confidence about the sale of insurance to seniors
The producer must handle every application and request for amendment as soon as possible
The producer must inform the insured if the insurer needs information prior to renewal/policy change
The producer may use any professional designation to instill confidence about the sale of insurance to seniors
It is a dishonest or unethical practice for a producer to use a professional designation that implies that the insurance producer has special certifi cation in advising a client in connection with the solicitation, sale, or negotiation of an insurance product.
An insurer is permitted by law to pay commissions to each of the following individuals, except:
Licensed producer who negotiates an insurance contract
Licensed producer with a compensation agreement based on loss experience
Property and casualty producer for the sale of life insurance
P&C producer for the sale of surplus lines insurance
Property and casualty producer for the sale of life insurance
Commission may only be paid to a producer who is duly licensed, at the time of sale, for the line of insurance sold.
The Association covers existing claims prior to the determination of insolvency or that are submitted within how many days after the determination of insolvency? 10 30 60 90
Covered claims must be submitted no later than 30 days after the determination of an insurer’s insolvency.
The Association’s funds are divided into 4 separate accounts. Which of the following is NOT one of those accounts?
Homeowner insurance account
Workers’ Compensation insurance account
Automobile insurance account
Missouri mutual and extended Missouri mutual insurance company account
No homeowners insurance account exists.
The FAIR Plan provides property insurance to which of the following persons?
One who owns a vacant home
One who is unable to obtain property insurance through the standard market
One who owns property with unrepaired fire damage
One who owns a business building in very poor physical condition
One who is unable to obtain property insurance through the standard market
The FAIR Plan provides insurance for applicants who are unable to purchase basic property insurance through the standard market; property that is vacant, in poor condition, or with unrepaired loss damage are specifically ineligible for coverage.
Which of the following is NOT true about the Missouri FAIR Plan?
All admitted property insurers in Missouri must participate in the FAIR plan
Property to be insured must meet reasonable underwriting standards
Perils covered under the FAIR Plan are normally limited to fire and extended coverage
Licensed producers may bind coverage and accept premium payments
Licensed producers may bind coverage and accept premium payments
Producers are not contracted by the FAIR Plan and do not have the authority to bind coverage of accept premium payments on behalf of the FAIR Plan.
The coverage period for a wedding present floater may not exceed how many days after the wedding day? 90 60 30 120
A personal property floater covers wedding presents up to 90 days after the day of the wedding.
Before cancelling a property insurance policy for non-payment of premium, an insurer must give the insured how many days' written notice? 10 30 45 60
An insurer terminating a property insurance policy for non-payment of premium, or because the insured committed arson, must give the insured 10 days’ notice.
Which of the following binders WAS issued legally?
A 3-day binder for which no premium was charged
A binder that was replaced by a policy with a different effective date
A binder that was not replaced by a policy; the binder fee of $50 was waived
A binder that was not replaced by a policy; the binder fee of $10 was waived
A binder that was not replaced by a policy; the binder fee of $10 was waived
When a binder is issued and is not replaced by a policy, the insurer may waive the binder fee if it is $20 or less.
Which of the following is NOT considered proof of financial responsibility in Missouri?
An insurance agent’s verbal statement
An insurance ID card issued by an insurer
A bond filed with the state
A certificate of self-insurance
An insurance agent’s verbal statement
In Missouri, acceptable proof of financial responsibility is an insurance certificate or ID card issued by an admitted insurer, a bond or certificate of deposit with the state, and a certificate of self-insurance.
What are the minimum limits of financial responsibility required by the state of Missouri?
5/10/10
10/20/40
25/50/10
50/100/25
Minimum limits of financial responsibility in Missouri are 25/50/10.
An auto insurer may non-renew an auto insurance policy for all of the following reasons, except:
The driver’s license of the named insured’s resident son was revoked
The named insured driver’s license was revoked
Non-payment of premium
The named insured’s chauffeur’s license was suspended
The driver’s license of the named insured’s resident son was revoked
An insurer cannot non-renew because of the license revocation of a household member; however, it may issue an operator exclusion endorsement.
Within how many days must an insurer notify a claimant it is either accepting or denying the claim? 10 15 21 30
15
Within 15 working days of receiving all necessary documentation that establishes the nature and extent of a claim, insurers must notify the claimant whether the claim accepted or denied
An employer required to provide Workers' Compensation in Missouri has a MINIMUM of how many employees? 5 10 15 20
5
In Missouri, an employer must provide Workers’ Compensation coverage if it has 5 or more employees; an exception exists for employers who exist
Within how many days must an employee report a workplace injury to the employer? 2 10 30 180
30
Employees must report workplace injuries within 30 days or risk not having the injury be covered by Workers’ Compensation insurance.
