The Insurance Marketplace

Question 1

What is express authority

Answer 1

Is the authority a principle intends to grant to an agent by means of the agents contract. It is written in the contract

Question 2

Implied authority

Answer 2

Is the authority that is not expressed or written into a contract, but which the agent is assumed to have in order to transact business.

Question 3

Apparent authority

Answer 3

Is the appearance or the assumption of authority based on the actions, words, or deeds of the principle or because of circumstances the principle created. It’s also known as perceived.

Question 4

The commissioner of insurance is elected for how long?

Answer 4

Maybe elected to serve not more than 2 consecutive 4-year terms.

Question 5

What does the commissioner have the power to do?

Answer 5

They have the authority to enforce the law, NOT write or change the law. Their duty is to issue revaluations which establish how the department of insurance intends to interpret and enforce the law. They oversee the CDI and direct the CDI’s affairs and staff

Question 6

False advertising is

Answer 6

Any advertising that includes any untrue, deceptive, or misleading statements that apply to the business of insurance.

Question 7

Rebating is

Answer 7

Defined as any inducement offered to the insured in the sale of insurance products that is not specified in the policy.

Question 8

Twisting is

Answer 8

A misrepresentation or incomplete or fraudulent comparison of insurance policies that persuades an insured/owner, to their detriment, to cancel, lapse, switch policies or take out a policy with another insurer.

Question 9

Defamation

Answer 9

Occurs when an oral or written statement is made that is intended to injure a person engaged in the insurance business.

Question 10

How many days does a licensee have to respond to any inquiry from the department of insurance?

Answer 10

21 days

Question 11

How many days does a licensee have to respond to receiving any communication from a claimant?

Answer 11

15 days

Question 12

For senior agents, the requirement for continuing education for California partnerships for LTC is?

Answer 12

8 hours each renewal period

Question 13

What term means the result of calculation based on the average number of months the insured is projected to live due to medical history and mortality factors?

Answer 13

Life expectancy

Question 14

When can a life- only agent transact disability insurance on behalf of an authorized insurer?

Answer 14

Upon obtaining a signed notice of appointment by the insurer

Question 15

No person can act as an administrator in this state unless he or she

Answer 15

Holds a certificate of registration by the commissioner

Question 16

Who is a Reinsurer in terms of reinsurance?

Answer 16

The reinsurer is the company that in consideration of the premium paid, assumes a part of the risk over an amount retained by the primary insurer known as the net line.

Question 17

What is reinsurance?

Answer 17

Is insurance purchased by a primary insurer to protect itself against the catastrophe of a comparatively large single loss or a large number of small losses caused by a single occurrence.

Question 18

Who is the Primary insurer in a reinsurance?

Answer 18

The insurer covering losses on a first dollar basis, who issues the policy over which reinsurance is purchased. Also called the ceding company.

Question 19

What is insolvency?

Answer 19

An inability of the insurer to meet its financial obligations when they are due.

OR

Any impairment of minimum paid-in capital required of an insurer by the provisions of the insurance code for class or classes, of insurance that it transacts anywhere