Unit#7 California Insurance Regulation

Question 1

Who enforces the code ?

Answer 1

The commissioner

Question 2

The code of insurance is organized into?

Answer 2

Six major divisions

Question 3

An admitted insurer is authorized to transact what?

Answer 3

Insurance business in the state.

Question 4

Non-admitted insurers are not authorized to transact what ?

Answer 4

Insurance business in the state

Question 5

To transact insurance what must the insurer have? If not what can the insurer face ?

Answer 5

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.

Question 6

How does California Life and Health Insurance Guarantee Association protects insureds from insurers?

Answer 6

They protect insured from insurer insolvency or impairment

Question 7

What’s the difference between insolvency and bankruptcy? Are they the same

Answer 7

They are not the same. Insolvency means you can’t can’t pay your debt
And bankruptcy means to collapse

Question 8

The California insurance code is written and amended by the ?

Answer 8

State legislature not the commissioner

Question 9

What is the producer not allow to do because he belong to the California life and health insurance guarantee association ?

Answer 9

Not to tell the customer not to worry

Question 10

In a contract shall and may means ?

Answer 10

Shall means mandatory and may means permissive

Question 11

What does executing an insurance contract constitutes the transaction of insurance ?

Answer 11

The transaction of insurance

Question 12

What’s the the three types of authority that an agents has ?

Answer 12

Express, implied, and apparent

Question 13

How many days does the insurance company ( insurer) have to submit a notice to the commissioner ?

Answer 13

14 days

Question 14

What are the reasons for an application for license will be denied ?

Answer 14

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.

Question 15

If acting without a license ?

Answer 15

Is punishable by a fine of up to 50,000, imprisonment for one year. Or both

Question 16

What can’t an agent not represent ?

Answer 16

No admitted insurer.

Question 17

When can a license be renewed ?

Answer 17

A license can be renewed on or before expiration date.

If the application renewal application is deficient, the license is extended for 60 days.

Question 18

When must a license number be displayed ?

Answer 18

On a business cards, illustrations, and in advertising

Question 19

Does the commissioner have the right to approve or disapprove all actual or fictitious names?

Answer 19

Yes, the commissioner has this right to approve or disapprove all actual or fictitious names ?

Question 20

When can the agent disclose ?

Answer 20

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.

Question 21

A life and disability analyst must issue a written contract to the client?

Answer 21

So the analyst must disclose commission for product sales.

Question 22

A life and disability analyst must keep fee agreement for how long ?

Answer 22

Three years

Question 23

Why can a person transact business in any class of insurance ?

Answer 23

Have to be admitted to the class

Question 24

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 ?

Answer 24

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.

Question 25

What happens if the insurers is engaged in unfair trade practice ?

Answer 25

May have there certificates of authority suspended

Question 26

Does free insurance exist ?

Answer 26

No such thing as free insurance

Question 27

Advertisement for term insurance sold to a person age 55 yrs and older must fully disclose ?

Answer 27

Disclose life insurance to accidental death benefit, reduction to the death benefit, and at what age benefit terminates.

Question 28

What will errors and omissions insurance will not pay ?

Answer 28

Fraudulent or criminal act committed by the agent