Chapter 18 - Insurance Regulations Flashcards
(39 cards)
Define Coercion
Forceful act of threat aimed to influence a person to act against their will
Define Inducement
An offer that attempts to influence the other party
Define Moral Turpitude
Conduct that is contrary to community standards of justice, honesty, or good morals
Define Promulgate
To make public, to put into action
Define Superintendent of Financial Services
The head of the NYS Department of Financial Services
Define Insurance Producer
An insurance agent, title insurance agent, insurance broker, reinsurance intermediary, excess lines broker, or any other person required to be licensed under the laws of this state to sell, solicit or negotiate insurance.
Define Misrepresentation
Making false or misleading statements with the intent to defraud another
If a hearing is scheduled for a producer who has violated regulations regarding unfair trade practices, the Superintendent must send a prior notice within how many days of the hearing?
10 days
In order for a nonresident licensee to become a resident producer in NY, the licensee must do what?
Apply within 90 days of becoming a resident.
The Superintendent can examine an authorized fraternal benefit society and property/casualty insurance company how often?
Once every 3 years.
When must an agent submit their license renewal applications to the Superintendent?
At least 60 days before the license expires.
To qualify for an insurance license, what are the requirements? (7)
- An applicant must submit an application to the Superintendent and declare that all statements are true, accurate and complete to the best of the applicant’s knowledge and belief
- Be a resident of NYS
- Be at least 18 years old
- Submit a standard application for licensing on a form approved by the Superintendent.
- Pay the applicable fees
- Pass the applicable examination for each line of authority
- Fulfil the prelicensing education requirement or classroom work or equivalent in correspondence work or similar instruction (20 hours a single life of authority agent or broker, such as Life only agent or broker, 40 hours for a Lice, Accident and Health agent or broker, Personal Lines agent or broker and Public Adjuster, and 90 hours for Property/Casualty agent or broker).
For who is a written examination not required when applying for an insurance agent’s license? (8)
- Ticket-selling agent or rep (airline, bus, train, or sea) for one-time issuance of baggage or accident insurance
- Any individual whose license has been revoked or suspended (at the discretion of the Superintendent)
- In connection with any certificate of appointment for an additional insurer, as long as it is under the same line of authority already licensed.
What are the Department of Insurance Powers and Duties? (6)
- Control and supervise all insurance business in the state
- Enforce insurance laws
- Issue licenses and certificates of authority
- Approve policy forms
- Conduct examinations, investigations, and hearings
- Impose Penalties
Why does the Department of Insurance not set premium rates or establish fines and penalties?
Those are defined by law
What are the types of insurance licenses? (7) (not accident/life)
- Producer (Agent) - Represents insurers, appointed to transact on behalf of the insurer
- Insurance broker
- Business Entity - Corporation/Association/Partnership - Must have a designated Agent
- Consultant
- Adjuster
- Nonresident - Different home state, licensed to transact in resident and non-resident states.
- Temporary - Issued for the continuation of existing business, a short period of time, approved by the department, not renewable
Agents get appointed in two ways, what are they?
- Appointed to each insurance company you will do business with so you can act as an agent
- Appointed for each product you will be selling.
When an insurer appoints an agent, what else do they have to do for the Department of Insurance?
They file a notice of agent appointment and pays appointment fees
An insurance producer license is not required of any officer, director or employee of an insurer or organizations employed by insurers, provided they what? (2)
- Are not directly or indirectly involved with the actual sale of an insurance contract
- They do not receive any commission.
Define Insurance Agent
- A person authorized by an insurer, fraternal benefit society or HMO to solicit, negotiate and obtain insurance, HMO or annuity contracts
- The agent represents the insurer
Define Insurance Broker
- Any person, firm, association or corporation who solicits, negotiates or obtains insurance for an insured (other than him/herself) in exchange for a commission.
- -A broker represents the insured
- Acts in the best interest of the insured
Define Consultants
-Offer advice to the public about the benefits, advantages, and disadvantages or insurance policies for a fee.
-The Superintendent may issue an insurance consultant’s license to any person, firm, association, or corporation who has complied with the following requirements:
-Submit a written application and pay a fee of $50
per year
-Pass a written examination
-Must be trustworthy and competent
-Must not be an executive or an employee of or own
any shares in the insurer they represent.
Define Independent Adjuster
Any person, firm, association, or corporation, who, for a commission, acts on behalf of an insurer in the work of investigating and adjusting claims. An independent adjuster may not include any of the following:
- Officer, director, or regular salaried employee of an insurer
- Adjustment bureau or association owned by the insurers
- Licensed agent of the insurer, or
- Attorney at law
Define Public Adjuster
Any person, firm, association, or corporation, who, for a commission, acts on behalf of the insured in negotiating a settlement of a claim for loss or damage to property. The following are not considered public adjusters:
- Employee, agent, broker, or other representative of any insurer who acts as an adjuster, or
- Attorney at law
