NC Statues & Regulations Pertinent to Life Flashcards
Which of the following would not have to comply with the Insurance Information and Privacy Protection Act?
The insurance regulators
If an agent offers to give the prospect part of the commission as an incentive to buy the policy, the agent is engaging in an illegal act known as
rebating
If the insurance company is going to use information from public records, such as DMV records, when must the Notice of Information Practices be provided by the prospect?
No later than the delivery of the policy
How many days does a person have to request the reason for an adverse underwriting decision
90 business days
The commissioner of insurance
approves insurance rates
If an individual sends in a written request concerning disputed information, how long does the insurance company have to report their findings to him/her
30 business days
An insurance company can base rates on all of the following except
race
The insurer cannot refuse to issue or charge a higher premium in which of the following circumstances?
A person who possesses the sickle cell anemia
All statements in the application and the policy are deemed to be
representations
Which of the following actions could be completed without an insurance agent’s license
accepting premiums and or applications
Under the Insurance Information and Privacy Protection Act when must a prospect be notified that information will be obtained from nonpublic records
at the time the information is gathered
Which of the following statements is not true regarding adverse underwriting decisions
the insurer can base an adverse underwriting decision solely on the basis of a previous adverse underwriting decision
If the company issues a policy based on an incomplete application, and the insured suffers a loss after the policy goes into effect, the company
is obligated to pay full benefits
An insurance company whose home office is located in NC could be referred as
domestic
Any change of residency within the state must be reported to the Department of Insurance within how many days10
10
At what time would an insured most likely be given information concerning his/her rights under the Insurance Information and Privacy Protection Act
When the company makes an adverse determination
The commissioner’s powers include all of the following except
Enacting laws
Untrue statements about a competitor or his/her company is called
rebating
The Insurance Information and Privacy Act
Sets up procedures for consumer reporting agency
If an agent uses illegal tactics to persuade a prospect to drop existing insurance, then he is guilty of
twisting
If the commissioner of insurance is unable to fulfill his/her term, then who appoints someone to take his place
the governor
All of the following are examples of unfair practices except
furnishing required disclosure information
Instead of turning in premium collection for a given week, an agent uses the money to pay a few personal bills. This would be an example of
embezzlement/larceny
The commissioner of insurance is elected by the people of NC for a term of
4 years
An agent could be personally liable for doing which of the following
representing an unauthorized company
Which of the following is not a requirement to be licensed in NC
being a high school graduate
An individual hides known material facts, leading an insurance company to make a different underwriting decision than they would have had had they know the truth. This is called
Concealment
Who is protected under the Fair Credit Reporting Act
The consumer
A disclosure authorization form is valid for a maximum of _____________months
30
Under the Fair Credit Reporting Act, the applicant does not have which of the following rights
the right to sue companies for adverse decisions
What is the purpose of the Insurance Information and Privacy Protection Act
To establish standards for the collection, use and disclosure of information gathered in connection with insurance transactions by insurance institutions and insurance support organizations, and agent
The commissioner may do all of the following except
change state insurance laws at will for the good of the general public
When a company becomes aware that an agent is guilty of embezzlement, they must file the commissioner a completer statement of the facts within
30 day
The minimum age for an individual to be licensed is
18
A temporary license may be issued for a maximum of ___________days
180
The continuing education (CE) requirements include __________ credit hours completed buiennially (every 2 years)
24
Whom does the agent represent
the seller
A replacement notice must be sent to the existing company within
5 working days
If an agent is allowed to represent one company and one company only, he/she is referred to as a
captive(exclusive) agent
An agent may all him/herself a financial planner or investment advisor if
the source of the compensation is stated
The broker represents the
policyholder
An agent cannot use the terms “financial planner” or “investment advisor” unless
he/she has obtained the proper credentials
A Hearing Order issued by the commissioner requires advance notice of at least _____________ days
10
Which of the following is not true regarding the general rules of life insurance solicitations
Cost indexes are only useful in comparing the relative costs of two or more policies from the same company
Replacing life insurance policies are required to provide a free-look period of
30 days
Efforts by an insurance company to keep their policyholders from dropping insurance to buy from another company are called
conservation
In NC, a minor over the age of ________ may make contracts of insurance
15
Existing insurance that is dropped in order to purchase a new insurance is known as
replacement
An attempt by an existing insurer to dissuade a policy owner from replacing an existing life insurance policy is called
conservation
Failing to deliver a policy summary when required is considered
misrepresentations
If a replacement is, in fact, taking place, when must the agent have the applicant sign a Notice Regarding Replacement Form
At the time of the application
NC Life’s Insurance Replacement Regulation applies to
Whole Life Insurance
When a life insurance policy is delivered, what must be given to the insured
Buyers’ Guide and Policy Summary
Which of the following statements is correct regarding the use of the term “financial Planner”
The agent cannont represent him or herself as one unless he / she is properly qualified
The purpose of the replacement laws is
to protect the interests of life insurance purchasers by establishing minimum standards of conduct
Which of the following would not constitute a replacement
converting term insurance in the same company
When is the delivery of a policy summary not required
if the policy has an equivalent level death benefit of 5,000 or less
When does an agent have to inform someone that certain questions being asked are solely for marketing or research purposes
Any time he/she sells insurance
An agent’s insurance license should
be carried with you
What do you call someone who is licensed to sell only credit life, travel accident or dental insurance
a limited representative
The Guaranty Association protects the policyholder of companies that become insolvent. The money used to bail out an insolvent company comes from
the member insurers(Companies)
A prearrangement (funeral) insurance policy is being purchased. All of the following must be disclosed at the time of application and prior to the acceptance of the initial premium, except which
how much the policy is actually costing the funeral home and their profits from the sale
The Guaranty Association provides protection for all of the following except
fraternals
Using the existence of the Guaranty Association as an aid to the sale of insurance is
prohibited
What is the purpose of the Guaranty Association
to protect the insured against an insurer’s failure to perform its contractual duties
Which of the following would be covered by the Guaranty Association
A supplemental policy, such as a hospital indemnity
All of the following are covered under the Guaranty Association except
group dental insurance
A contract whereby immediate cash is given in exchange for the transfer of a life insurance policy is called a
viatical
An insurance company whose home office is in another state would be called
foreign
Appointments are renewed by the NC Department of Insurance how often
Annually
