Licensing (Law Ch. 2)

Question 1

Temporary License

Answer 1

Goes to surviving spouse or legal representative. Valid for 180 days

Question 2

Expiration of License

Answer 2

Expire every 2 years on the last day of the Licensee’s birth month

Question 3

License Renewal

Answer 3

A producer may reinstate a license within 12 months of its expiration date without taking an exam by paying twice the unpaid renewal fee and satisfying any continuing education requirements.

Question 4

Continuing Education

Answer 4

Required. Must complete 24 hours of coursework including 3 credit hours in OR and 3 credit hours in professional ethics for producers.

Question 5

Premium Funds

Answer 5

Any consideration received from or for an insured to obtain insurance.

Question 6

Fiduciary Capacity

Answer 6

Takes care of money or other assets for another person.

Question 7

Deposits and Payments

Answer 7

Required deposits within 7 days after funds are received.

Pay any premiums funds owed to an insured within 30 days.

Question 8

Termination

Answer 8

cancellation of the relationship between an insurance producer.

Question 9

Claims

Answer 9

Pay claims within 30 days after receipt.

Respond to director within 21 days

Question 10

Capitalization

Answer 10

The minimum combined paid-up capital and surplus required of a stock insurer or the minimum surplus required of an insurer without capital stock

Question 11

Required Capitalization

Answer 11

Most insurer’s need capital and/or surplus of at least $2,500,000, WC needs $5,000,000. To apply for an original certificate of authority, a domestic insurer will need an additional $500,000.
The size and risk an insurer may keep on any one subject of interest which is limited generally to 10% of the insurer’s surplus to policy holders.