General Insurance Principles - MI Insurance Law Flashcards

1
Q

Producer Appointment [500.1208a, .1208b, 1209, .1411]

A

Insurers can appoint as many producers as needed and do so by filing a notice of appointment with the Commissioner within 15 days of making the producer its agent. The insurer pays a fee for every appointment and renewal. The Commissioner has 30 days to notify an insurance company of a producer’s eligibility and 5 days to notify an insurance company of a producer’s ineligibility.

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2
Q

Termination of Appointment [500.1208b, .1209]

A

An insurer can terminate a producer by notifying the Commissioner within 30 days of the termination. Within 15 days of notifying the Commissioner, the company must notify the producer.

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3
Q

Acting without a license [500.251, .1201a, .1202, .1203]

A

No person or company may conduct insurance business in MI without being properly licensed with the Commissioner.

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4
Q

Commissions [500.1240, .2011]

A

Commissions cannot be paid or received if the producer is not licensed in MI unless the commission is for the renewal of a policy written when the producer was licensed in MI.

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5
Q

Fiduciary Capacity [500.1207]

A

A producer acts as a fiduciary for all money received and must turn over all money in a timely manner to the persons entitled to the funds. A producer must maintain records of funds received in his or her fiduciary capacity.

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6
Q

Types of Licenses [500.1206]

A

Life; Accident and Health or Sickness; Property; Casualty; Variable Life and Variable Annuity; Personal Lines; Credit

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7
Q

Reporting of Actions [500.1208b, .1239, .1244, .1246., 1247]

A

A producer is required to report to the Commissioner any administrative or disciplinary action taken against the producer in another state or by another government agency in Michigan. A producer must report to the Commissioner any criminal prosecution taken against the producer within 30 days of the initial pretrial hearing.

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8
Q

Continuing Education Requirements

[500.1204, .1204c, .1204d, .1204d, .1294f, .1206]

A

Every insurance producer licensed in Michigan is required to complete at least 24 hours of continuing insurance education every two years in order to renew his or her license. At least three of these hours must be in ethics.

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9
Q

Reciprocal Licensing

A

The Commissioner will waive the continuing education requirements for nonresidents with a valid license from their home state if the applicant’s home state awards nonresident licenses to Michigan residents on the same basis. A nonresident producer who satisfies his or her home state’s continuing education requirements will be considered to have satisfied Michigan’s requirements, if the other state recognizes the satisfaction of its continuing education requirements imposed upon Michigan producers on the same basis.

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10
Q

Twisting [500.2005(f), .2064(2)]

A

A person cannot make a false or misleading statement or comparison about an insurance policy in order to induce someone to lapse, forfeit, exchange, convert, or surrender an insurance policy or buy a policy with another insurer.

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11
Q

Payment of Claims [500.2006(1), (3), (4)]

A

When an insurer receives notice of a claim, it must within 30 days provide the insured with the documents necessary to file proof of loss. (Health insurers must provide these documents within 15 days.) The insurer is required to pay a valid claim within 60 days of receiving proof of loss. Benefits that are not paid when due earn simple interest beginning 60 days after the insurer received valid proof of loss. Interest accrues at the rate of 12 percent per year.

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