WA Property And Casualty Key Facts

Question 1

A producer must notify of a change of address within how much time?

Answer 1

No later than 30 days..

Question 2

What rules apply to property and casualty insurance producer or adjust in the state of Washington.

Answer 2

The producer must have a place of business that is open to the public. If the producer is a non-resident producer, then the location may be in the producer’s home state.

Question 3

True/False

If a producer has more than one location, the producer is only required to display his/her license in his/her primary office.

Answer 3

False

A producer. Must display the license in each location open to the public. The producer may request a duplicate license (and pay the applicable fee).

Question 4

What is insurance that can be legally obtained from an unauthorized insurer called?

Answer 4

Surplus line coverage

Question 5

True/False

Licensed surplus lines brokers may accept and place surplus lines business from any producer licensed in this state for the kind of insurance involved, and may compensate producers for the business placed.

Answer 5

True

Question 6

Are surplus line insurers required to have a Certificate of Authority?

Answer 6

No

Question 7

What actions must a Surplus line broker take prior to selling insurance in Washington state?

Answer 7

He/She must post a surety bond with the Commissioner that guarantees he/she will remit premium taxes and be accountable to person from whom he/she collects premiums.

Question 8

What date are Surplus line taxes due?

Answer 8

March 1st

Question 9

Will authorized insurers accept insurance written by Surplus lines insurers?

Answer 9

Generally insurers will not accept due to the risk involved.

Question 10

Who is responsible for placing business either with an authorized insurer or through a licensed surplus lines broker?

Answer 10

The producer

Question 11

What type of insurance lines typically write aviation and marine insurance?

Answer 11

Surplus lines

Question 12

How much notice is required for an insurer to cancel a commercial lines policy for any reason other than non-payment of insurance?

Answer 12

45 days of written notice

Question 13

When a policy is cancelled for non-payment, how many days are required for advance notice?

Answer 13

10 days

Question 14

When an insurer cancels a fire policy for vacancy or for poor physical condition (including increased risk of arson or fraud), how many days of notice are required?

Answer 14

5 days advance written notice

Question 15

What information must an insurer provide when cancelling a policy?

Answer 15

The reasons the policy is being cancelled.

Question 16

If a policy is cancelled by the insurer, what obligation is necessary in regards to the mortgagee or others with an interest in a loss that would occur under the policy?

Answer 16

They must be notified of the cancellation

Question 17

How much notice is required for an insurer to increase the premium rates for an insured’s policy?

Answer 17

20 days

Question 18

Can insurers charge the insured for retroactive premium changes?

Answer 18

No

Question 19

When an insurer cancels a policy, a pro-rata (proportional) refund must be sent to the insured. How many days after the date of the cancellation notice must the refund be issued?

Answer 19

45 days

Question 20

If the insured cancels a policy, within how many days must the unearned premium be returned to the insured?

Answer 20

30 days

Question 21

If an insurer furnishes a notice of cancellation or non-renewal to the insured, a copy of the notice must be sent to the producer within how many days?

Answer 21

5 working days

Question 22

Which may occur at the policy’s normal expiration date, cancellation or non-renewal?

Answer 22

Non-renewal

Question 23

Which may occur during the policy period, cancellation or non-renewal?

Answer 23

Cancellation

Question 24

Can an insurer cancel or non-renew a personal lines policy based in whole or part upon the insured’s credit history or insurance score?

Answer 24

No

Question 25

What is included in “personal lines” policies?

Answer 25

Personal Auto, homeowners and dwelling fire

Question 26

What is included in “Commercial Lines” policies?

Answer 26

Commercial liability, commercial fire and surety.

Question 27

Can an insurer use an applicants credit history to deny personal lines insurance?

Answer 27

No, an insurer can use credit history in combination with other underwriting factors, but not on it’s own.

Question 28

If an insurer chooses to cancel a HO policy, what must the insure provide?

Answer 28

The insure must provide a written notice of cancellation, along with the reasons why, 45 days in advance, to both the insured and the mortgagee.

Question 29

Can an insured cancel a HO policy at any time?

Answer 29

The insured can cancel at any time but does have to provide the insurer written notice prior to the effective date of cancellation.

Question 30

When an insured requests cancellation, what type of refund does the insured receive of unearned premium and when must the receive it?

Answer 30

When requested by insured, the refund is “short-rate” and the insurer must send the refund within 30 days of receiving the insured’s request.

Question 31

What notification must follow the insurer’s non-renewal of a HO policy?

Answer 31

The insurer must provide the insured with at least 45 days written notice and reasons for the non-renewal.

Question 32

Is the reason of the insured “does not meet the insurer’s underwriting requirements” sufficient explanation of non-renewal of an insurance policy?

Answer 32

No, the explanation must clear, simple and in understandable language and include an actual reason for cancellation, denial or refusal to renew.

Question 33

When an insurer cancels for non-payment of premium, any unearned premium must be calculated on a “pro-rata” or “short-rate” basis.

Answer 33

Pro-rata

Question 34

What is a temporary insurance coverage that is valid for 90 days or until the policy is issued, whichever comes first?

Answer 34

A binder

Question 35

A binders valid after the policy is issued?

Answer 35

No

Question 36

True/False

Binders are considered to include all the terms of the policy to be issued.

Answer 36

True

Question 37

What is required to extend a binder beyond 90 days?

Answer 37

The insurance Commissioner’s written approval.

Question 38

When do premiums start to be earned by an insurer?

Answer 38

The date a binder becomes effective.

Question 39

What must be included in a binder?

Answer 39

Binders must include the date, indenting the parties, describe the coverage, state the date and time coverage is effective and acknowledge the amount of any premium received.

Question 40

How many people are involved in a property insurance contract?

Answer 40

Two: the insured and the insurer

Question 41

True/False

A producer must display his/her license in a prominent location in his or her office where the public can view the license.

Answer 41

True

Question 42

Does the “binding premium receipt” need to state the terms of the insured’s prior policy?

Answer 42

No

Question 43

Where is the producer’s binding authority listed?

Answer 43

It is part of his/her contract with the insurer he/she represents.

Question 44

Can binders be oral?

Answer 44

yes

Question 45

If a binder has been issued as an oral contact, how long does the agent have to write or print the form and deliver or mail to the insured?

Answer 45

It must be done promptly, usually on the next business day.

Question 46

True/False

Applications for insurance must contain a clear statement as to whether or not coverage has begun.

Answer 46

True

Question 47

What must be given to the applicant promptly upon completion?

Answer 47

Copies of the application

Question 48

Who can alter an application?

Answer 48

Applications can only be altered by the applicant or with the applicant’s written consent.

Question 49

How much notice must a producer have when an insurer intends to terminate his/her contract.

Answer 49

120 days, unless the producer loses license, sells or abandons his agency, is guilty of misconduct, fraud or material misrepresentation.

Question 50

What time frame must the producer provide the commissioner with notice of an address change?

Answer 50

30 days.

Question 51

Resident producers must maintain their principal place of business where?

Answer 51

In the state of Washington in a place that is accessible to the public.

Question 52

Where must non-resident producers have a place of business?

Answer 52

They may have an office in Washington state or in their home state.

Question 53

Where must producers display their license where?

Answer 53

In a conspicuous location in their office that is open to the public.

Question 54

How many years are producers required to keep a record of all transactions under their licenses?

Answer 54

5 years, at their place of business.

Question 55

True/False

The Property and Casualty Insurance Guantanamo Association covers claims of insolvent insurers that are over $100 up to $300,000 or the policy limit if less (this includes claims for unearned premiums).

Answer 55

True

Question 56

Claims that existed prior to the determination of insolvency are covered by the funds as well as those that occur within how many days of the liquidation order?

Answer 56

30

Question 57

True/False

The Property and Casualty Insurance Guaranty Association is run by a board of directors that includes no less than five nor more than nine persons, as approved by the commissioner.

Answer 57

True

Question 58

Are all Washington state insurers that sell property and/or casualty insurance required to participate in the Guaranty Association as a condition of maintaining their Certificate of Authority.

Answer 58

Yes