Laws And Rules Flashcards

Which of the following is NOT considered rebating?
A) sharing commissions with an agent licensed in the same line of business
B) returning premium to a client as an inducement for purchasing a policy
C) giving some thing of value to an insured and exchange for their business
D) offering special dividends

A) Sharing commissions with an agent licensed in the same line of business

What is the reason for the establishment of rules governing life insurance and annuity replacements?
A) Lessen the chance for misrepresentation and incomplete disclosure
B) Regulate insurance rates
C) Protect the interests of the insurer
D) Protect the interests of the beneficiary

A) Lessen the chance for misrepresentation and incomplete disclosure

Why would the Commissioner examine an insurers records?
A) to determine the solvency of the insurer.
B) to determine claims rate of the insurer.
C) to approve rate increase by the Lessen the chance for misrepresentation and incomplete disclosure insurer
D) to determine the AM Best rating of the insurer

A) To determine the solvency of the insurer

All agents licensed less than 20 years are required to complete \_\_\_ continuing education hours every two years. A. 12 B. 16 C. 24 D. 30

In Georgia, monthly premium accident and sickness insurance policies must provide a grace period of at least A. 7 days B. 10 days C. 14 days D. 31 days

When is a group accident and health policy required to provide coverage for a newborn child?
A. When the policy owner notifies the insurance company
B. At the moment of birth
C.When the required additional premium is paid.
D. No more than 10 days after date of birth

B. At the moment of birth

Which of the following is the minimum age at which an individual can sign a life insurance application A. 15 B. 18 C. 19 D. 21

All accident and sickness plans must provide coverage on a newborn child for \_\_\_\_\_ days A. 7 B. 10 C. 25 D. 31

The act of an insurance company publishing misleading information about its policies provisions is called? A. Coercion B. False advertising C. Twisting D. Intimidation

the practice of persuading someone to do something by using force or threats.

As a condition for a loan, a bank requires the borrower to purchase credit insurance from a specific company. What is the bank guilty of? A. Coercion B. Defamation C. Rebating D. Misrepresentation

Defamation of insurer

It is an illegal practice to make any public statement or advertisement that contains false information or unsubstantiated criticisms about an insurance company

An example of false advertising would be
A. Written testimony from a celebrity spokesperson
B. And insurer exaggerating its dividends in a magazine advertisement
C. An agent giving a gift as an inducement for their business
D. And insurer advertising in an insurance trade journal

B. And insurer exaggerating its dividends in a magazine advertisement

Which type of insurance company allows their policy owners to elect a governing body? A. Stock B. Mixed C. Admitted D. Mutual

Nonprofit life insurance providers that are covered by a special section in the Georgia insurance code are called
A. Fraternal life insurance organizations
B. Domestic life insurance organizations
C. Unauthorized insurers
D. Mutual life insurers

A. Fraternal life insurance organizations

Defamation occurs when an agent makes a false statement intended to
A. Malign another insurer
B. Replace an existing insurance policy with another
C. Restrict fair trade
D. Miss represent the provisions of an insurance policy

A. Malign another insurer

To speak ill of

In Georgia, an insurers license to conduct business in Georgia, but domiciled in New Jersey, is called a A. Non-admitted Company B. Foreign company C. Domestic company D. Alien Company

B. Foreign company

In Georgia, most life insurance policies have a contestability period of A. 1 year B. 2 years C. 3 years D. 5 years

Who is a mutual insurance company owned by? A. Its Board of Directors B. Its policyholders C. The state of Florida D. Its employees

B. Its Policyholders

Which of the following is NOT an unfair claims settlement practice?
A. Failing to acknowledge and act promptly with respect to an insurance claim
B. Compelling an insured to initiate a lawsuit by offering less on an insurance claim
C. Failing to accept or deny a claim within reasonable time after proof of loss is submitted
D. Needing written documentation of claim details

D. Needing written documentation of claim details

When advertising, an insurer is required to use its A. Logo B. True corporate name C. Trademark D. Trade name

B. True corporate name

Prior to a hearing that could potentially revoke an agents license, what is required by the Commissioner?
A. Giving oral notice to the agent
B. Giving written notice to the agent
C. Giving both oral and written notice to the appointing insurer
D. Giving oral notice to the appointing insurer

B. Giving written notice to the agent

In Georgia, and insurance company must notify the commissioner within \_\_\_\_\_ days to terminate an agency appointment. A. 30 B. 45 C. 60 D. 90

The coordination of benefits (COB) provision exist in order to A. Avoid duplication of benefit payments B. Avoid excessive hospitalization C. Lower insurance premiums D. Maximize patient care

A. Avoid duplication of benefit payments

Which organization was established to provide funds to protect an insured in the event of an insurer’s insolvency?
A. National Association of insurance commissioners (NAIC)
B. Georgia life and health insurance guaranty Association
C. Department of insurance
D. Office of insurance regulation

B. Georgia Life and Health Insurance Guaranty Association

Who would be eligible for a temporary license issued in Georgia?
A. An agent visiting Georgia to write a policy
B. An agent to sell a policy from a company with which the agent is not appointed
C. The personal representative of a deceased agent to provide service to existing policy owners
D. A minor servicing a parent’s existing policy owners

C. The personal representative of a deceased agent to provide service to its existing policy owners

During the application process, the agents primary responsibility is to A. The commissioner B. The applicant C. The insurance company D. The state of Georgia

C. The insurance company

A producer must notify the commissioner within \_\_\_\_ days of an address change A. 15 B. 30 C. 45 D. 60

Who owns a stock company? A. Its policyowners B. Its stockholders C. Its Board of Directors D. Its CEO

B. Its stockholders

T is an agent and when hired, is reminded that he has a responsibility to handle clients’ funds and an honest and ethical manner. This responsibility is referred to as A. Fiduciary responsibility B. Reasonable trust C. Ethical behavior D. Legal competence

A. Fiduciary responsibility

In Georgia, long-term care policies are required to provide benefits for at least A. 6 months B. 12 months C. 18 months D. 24 months

How often is an insurance agent license to be renewed in Georgia? A. Every six months B. Each year C. Every two years D. Every three years

C. Every two years

An agent would be guilty of rebating by
A. Returning a portion of a premium as incentive to purchase insurance
B. Canceling a clients insurance policy without cause
C. Selling direct marketing products
D. Offering temporary insurance coverage

A. Returning a portion of a premium as incentive to purchase insurance

The life and health insurance guaranty Association is
A. An entity that exists in underwriting large insurance policies
B. Funded by admitted insurance companies through assessments
C. Funded by the state government
D. Administered by the federal government

B. Funded by admitted insurance companies through assessments

An example of an unfair claims settlement practice is
A. Making it mandatory that proof of loss be provided for each claim
B. Requiring a time limit for submitting a claim
C. Paying a claim in a timely manner
D. Turning down a claim without providing the basis of denial

D. Turning down a claim without providing the basis of denial

Which of the following is considered to be misrepresentation?
A. Replacing an existing policy with a new one
B. An agent guaranteeing a policy is dividends
C. Sharing commissions with other licensed agents
D. Representing a foreign insurer

B. An agent guaranteeing a policy’s dividends

A mutual insurance company and a stock insurance company have one main difference between them. What is this major contrast?
A. Stock company is regulated by the state where it’s incorporated. Mutual company is regulated by its policyholders.
B. Stock company is considered an authorized insurer. Mutual company is considered an unauthorized insurer.
C. Stock company is owned by its policyholders. Mutual company is owned by its shareholders.
D. Stock company is owned by a shareholders. Mutual company is owned by its policyholders.

D. Stock company is owned by a shareholders. Mutual company is owned by its policyholders.