Statutes common to all lines

Question 1

A producer in Ohio wants to become a producer in Idaho. The Director will waive certain examination requirements, provided that Ohio would waive these same requirements if an Idaho producer sought licensure in Ohio. What term is used to describe this arrangement?

Answer 1

Reciprocity

Question 2

Which of the following is the closest term to an authorized insurer?

Answer 2

Admitted

Question 3

An agent is acting ethically in all of the following situations EXCEPT

Answer 3

Always representing the insured

Question 4

In order to receive a commission, a person is required to

Answer 4

Be licensed as an insurance producer

Question 5

When handling premium funds, insurance providers are acting in a

Answer 5

Fiduciary capacity

Question 6

Each violation of the Insurance Code can result in fines up to $1,000 or imprisonment for

Answer 6

6 months

Question 7

An agreement that is enforceable by law is known as a

Answer 7

Legal contract

Question 8

An individual guilty of fraud is guilty of committing a

Answer 8

Felony

Question 9

Which of the following protects consumers against the circulation of inaccurate or obsolete personal or financial information?

Answer 9

Fair Credit Reporting Act

Question 10

Who appoints a new Director of Insurance

Answer 10

Governor

Question 11

A participating insurance policy may require which of the following?

Answer 11

Pay dividends to the policyowner

Question 12

The Gramm-Leach-Bliley Act was passed to

Answer 12

Protect private customer information filed with a financial institution

Question 13

Which of the following is an example of a producer’s fiduciary responsibilities?

Answer 13

A producer promptly forwarding premiums to the insurance company.

Question 14

After an insurer receives an itemized bill related to a valid motor vehicle policy claim, it must be paid within

Answer 14

20 days.

Question 15

All of the following would be consider rebating EXCEPT

Answer 15

An agent misrepresents policy benefits to convince a policyowner to replace policies

Question 16

In which of the following situations is it legal to limit coverage based on marital status?

Answer 16

It is never legal to limit coverage based on marital status

Question 17

Which of the following would be considered an unfair claims settlement practice?

Answer 17

A claims adjuster advises the insured that if the claim goes to arbitration, the insured would probably receive less than what is currently being offered

Question 18

Federal law makes it illegal for any individual convicted of a crime involving dishonesty or breach of trust to work the the business of insurance affecting interstate commerce

Answer 18

Without written consent from an insurance regulatory authority (Title 18)

Question 19

What is the minimum age when a person may purchase an insurance contract in this state?

Answer 19

15

Question 20

Any licensed person whose activities affect interstate commerce and who knowingly makes false material statements related to the business of insurance may be imprisoned up to

Answer 20

10 years

Question 21

Which best describes an insurance company that has been formed under the laws of this state?

Answer 21

Domestic

Question 22

Which of the following is an agreement between an insured and insurer, where the insurer agrees to indemnify the insured for specific losses in exchange for premium?

Answer 22

Insurance Contract

Question 23

An insurer neglects to pay a legitimate claim that is covered under the terms of the policy. Which of the following insurance principles has the insurer violated?

Answer 23

Consideration

Question 24

An individual currently licensed in S.C. just moved to Idaho. In order to avoid a relicensing exam, how soon after establishing legal residence should she apply for a resident license?

Answer 24

90 days.

Question 25

Which would NOT be considered unfair discrimination by insurers?

Answer 25

Discriminating in benefits and coverages based on the insured’s habits and lifestyle.

Question 26

An insurer decides to change its premium. Who must approve this change before it can go into effect?

Answer 26

Director of Insurance

Question 27

The Director issues an order to an insurer and immediately receives a request for the charges to be reviewed in court. Within what number of days must the hearing be held?

Answer 27

60 days

Question 28

Even though the Standard Fire Policy is a named peril contract, under which of the following circumstances would the policy provide “all risk of loss” coverage on insured policy?

Answer 28

When the loss is to insured property that has been removed because of endangerment by peril insured against in the policy.

Question 29

On participating insurance policy issued by a mutual insurance company, dividends paid to the policyholder are

Answer 29

Not taxable since the IRS treats them as a return of a portion of the premium paid.

Question 30

Within how many days of requesting an investigative consumer report must an insurer notify the consumer in writing that the report will be obtained?

Answer 30

3 days.

Question 31

According to the Terrorism Risk Act of 2002, which of the following is true about the reimbursement for the insured losses?

Answer 31

The insurer must pay a deductible that equals a percentage of the earned premiums for the previous year.

Question 32

Ab insurance agent’s responsibility doesn’t include what?

Answer 32

Represent the client

Question 33

The Federal Fair Credit Reporting Act

Answer 33

regulates consumer reports

Question 34

If a producer’s license has been revoked, what is the maximum amount of time they may be prohibited from reapplying for a new license?

Answer 34

5 years

Question 35

A participating insurance policy may do which of the following?

Answer 35

Pay dividends to the policyowner