Unit#7 California Insurance Regulation Flashcards
Who enforces the code ?
The commissioner
The code of insurance is organized into?
Six major divisions
An admitted insurer is authorized to transact what?
Insurance business in the state.
Non-admitted insurers are not authorized to transact what ?
Insurance business in the state
To transact insurance what must the insurer have? If not what can the insurer face ?
Certification of authority. If the insurer doesn’t have it then he/she will be facing 100,000 for penalty, or go to jail for a year, or both.
How does California Life and Health Insurance Guarantee Association protects insureds from insurers?
They protect insured from insurer insolvency or impairment
What’s the difference between insolvency and bankruptcy? Are they the same
They are not the same. Insolvency means you can’t can’t pay your debt
And bankruptcy means to collapse
The California insurance code is written and amended by the ?
State legislature not the commissioner
What is the producer not allow to do because he belong to the California life and health insurance guarantee association ?
Not to tell the customer not to worry
In a contract shall and may means ?
Shall means mandatory and may means permissive
What does executing an insurance contract constitutes the transaction of insurance ?
The transaction of insurance
What’s the the three types of authority that an agents has ?
Express, implied, and apparent
How many days does the insurance company ( insurer) have to submit a notice to the commissioner ?
14 days
What are the reasons for an application for license will be denied ?
It will be denied for a felony conviction, misdemeanor conviction of insurance laws, if a previous application was denied, or if a license was suspended or revoked.
If acting without a license ?
Is punishable by a fine of up to 50,000, imprisonment for one year. Or both
What can’t an agent not represent ?
No admitted insurer.
When can a license be renewed ?
A license can be renewed on or before expiration date.
If the application renewal application is deficient, the license is extended for 60 days.
When must a license number be displayed ?
On a business cards, illustrations, and in advertising
Does the commissioner have the right to approve or disapprove all actual or fictitious names?
Yes, the commissioner has this right to approve or disapprove all actual or fictitious names ?
When can the agent disclose ?
When the premium is accepted on a life contract and disclose the effective date of coverage or circumstances under which the coverage will become effective.
A life and disability analyst must issue a written contract to the client?
So the analyst must disclose commission for product sales.
A life and disability analyst must keep fee agreement for how long ?
Three years
Why can a person transact business in any class of insurance ?
Have to be admitted to the class
What’s the penalty for twisting and misrepresentation? And if the loss is over does the agent get three times the amount ? Or jail ? How long ? And how long does your license get suspended ?
The penalty is $25,000, and if loss is present three times the coverage.
10,000 and one year in county jail plus license suspended for three years.
