Insurance Regulation Chapter 9
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Questions and Answers

How often must an insurance agent licensed in the state of New York renew the license?

Every 2 years

Which of the following is an approved written document that identifies procedures in place to keep the insurer's Information System safe?

  • Information Security Plan
  • Cybersecurity Policy (correct)
  • Risk Management Policy
  • Operational Procedures

    • Circulating deceptive sales material to the public is what type of Unfair Trade Practice?

    False advertising

    When will an insurance agent's license expire if they were born in 1983 and obtained their New York insurance license in 2014?

    <p>On an agent's birthday every odd numbered year</p> Signup and view all the answers

    All of the following are reasons to terminate an agent's certificate of appointment EXCEPT

    <p>An agent becomes disabled and is unable to complete his duties for the duration of the disability</p> Signup and view all the answers

    All of the following are true about the Insurance Frauds Prevention Act EXCEPT

    <p>Every insurer must file a fraud prevention plan within 150 days</p> Signup and view all the answers

    Which act requires that an insurance company supply the applicant with the name and address of the consumer reporting company?

    <p>Fair Credit Reporting Act</p> Signup and view all the answers

    The Superintendent may refuse to issue a license in all of the following situations EXCEPT if the proposed licensee

    <p>Is from another state</p> Signup and view all the answers

    Is it legal to limit coverage based on marital status?

    <p>No, it is never legal.</p> Signup and view all the answers

    If an insurance company makes a statement that its policies are guaranteed by the existence of the Insurance Guaranty Association, how is this regarded?

    <p>An unfair trade practice</p> Signup and view all the answers

    An insurer publishes intimidating brochures that portray the insurer's competition as financially unstable. How is this act described?

    <p>Illegal under any circumstances</p> Signup and view all the answers

    What are the continuing education requirements for licensed insurance agents in New York?

    <p>15 hours of approved instruction every 2 years</p> Signup and view all the answers

    What constitutes the continuing education (CE) requirement for insurance agents in New York?

    <p>Completing 15 hours of continuing education each biennium</p> Signup and view all the answers

    Which of the following is NOT a qualification for licensing as an insurance producer in New York?

    <p>Have a letter of recommendation attesting to the applicant's trustworthiness</p> Signup and view all the answers

    How long does a licensee have to notify the Superintendent of a change of address?

    <p>30 days</p> Signup and view all the answers

    If a certificate of appointment is terminated, how soon must a statement be filed with the Superintendent?

    <p>30 days</p> Signup and view all the answers

    What is it called when an agent offers a client tickets to a game with the condition of purchasing a policy?

    <p>Rebating</p> Signup and view all the answers

    What kind of responsibility do agents, brokers, and reinsurance intermediaries have to their clients?

    <p>Fiduciary responsibility</p> Signup and view all the answers

    Which of the following would NOT be considered an improper claims practice?

    <p>Denying a claim after proof of loss is submitted</p> Signup and view all the answers

    Which of the following would NOT be a violation of state insurance regulations?

    <p>Agent A uses her license to write only business other than controlled</p> Signup and view all the answers

    Who does the agent represent?

    <p>The insurer</p> Signup and view all the answers

    If an individual's license has been revoked, how soon can they obtain a new license?

    <p>After 1 year of the revocation</p> Signup and view all the answers

    Which of the following would NOT be considered an insurance producer?

    <p>An insurer's officer</p> Signup and view all the answers

    Which of the following is NOT a prerequisite for an insurance license in New York?

    <p>Be at least 21 years of age</p> Signup and view all the answers

    Which of the following is NOT a justifiable reason for the Superintendent to revoke, suspend, or refuse to renew a license?

    <p>A licensee does not sell enough policies to reach his financial goals</p> Signup and view all the answers

    Which term describes making false statements about an insurer's financial condition to injure another person in the insurance business?

    <p>Defamation</p> Signup and view all the answers

    Which individuals must pass the written examination to be licensed as insurance agents?

    <p>A producer previously licensed in New Jersey who is applying for a New York license 120 days after becoming a resident of this state</p> Signup and view all the answers

    An independent adjuster may include which of the following?

    <p>A firm who acts on behalf of the insurer</p> Signup and view all the answers

    For the protection of public interest, the Superintendent may examine the books and records of any of the following EXCEPT

    <p>Policyowners</p> Signup and view all the answers

    When a producer reviews a potential customer's coverage from another company and makes critical remarks, what could they be found guilty of?

    <p>Defamation</p> Signup and view all the answers

    In order for a nonresident licensee to become a resident producer in New York, what must the licensee do?

    <p>Apply within 90 days of becoming a resident</p> Signup and view all the answers

    If an agent fails to promptly remit the premiums collected from the insured to the insurer, what may the agent be found guilty of?

    <p>Embezzlement</p> Signup and view all the answers

    According to federal law, what must an individual convicted of a crime involving dishonesty or breach of trust receive before working in insurance?

    <p>Written consent from an insurance regulatory authority</p> Signup and view all the answers

    An agent has recently changed his email address. What must the agent do to comply with the regulation for change of address?

    <p>Inform the Department within 30 days</p> Signup and view all the answers

    Two individuals in the same risk and age class charged different rates for their insurance policies due to an insignificant factor is called what?

    <p>Discrimination</p> Signup and view all the answers

    Which of the following may NOT be included in an insurance company's advertisement?

    <p>That its policies are covered by a state Guaranty Association</p> Signup and view all the answers

    The Superintendent may refuse to renew a license if a licensee receives more than 10% of aggregate commissions from controlled business in how many months?

    <p>12 months</p> Signup and view all the answers

    If an insurance company wishes to order a consumer report on an applicant to assist in underwriting, which of the following information may NOT be included?

    <p>Ancestry</p> Signup and view all the answers

    Which of the following will NOT be considered unfair discrimination by insurers?

    <p>Providing benefits based on lifestyle habits</p> Signup and view all the answers

    Can the Superintendent investigate fraudulent claims if they occurred outside of the resident's state according to the Insurance Fraud Prevention Act?

    <p>True</p> Signup and view all the answers

    Which entities protect policyowners, insureds, and beneficiaries under insurance contracts when insurers fail to perform due to financial impairment?

    <p>Guaranty Associations</p> Signup and view all the answers

    An insurance broker's license may be issued to whom?

    <p>A person, firm or corporation</p> Signup and view all the answers

    In this state, a temporary license may be issued for all of the following reasons EXCEPT

    <p>An agent's retirement</p> Signup and view all the answers

    Which acts committed by an agent would warrant revocation or suspension of the agent's license?

    <p>Forgery</p> Signup and view all the answers

    How long does a licensee have to deliver information requested by the Superintendent of Financial Services?

    <p>15 days</p> Signup and view all the answers

    Which individual would be required to be licensed as an insurance producer?

    <p>A salaried employee who advertises and solicits insurance</p> Signup and view all the answers

    All of the following events will terminate an agent's appointment EXCEPT

    <p>A new Superintendent is put into office</p> Signup and view all the answers

    An insurance broker's license may be issued to whom?

    <p>A person, firm or corporation</p> Signup and view all the answers

    It would be considered unfair discrimination to ask an insurance applicant about which of the following as a rating factor?

    <p>Sexual orientation</p> Signup and view all the answers

    The Superintendent will not renew an agent or broker's license upon finding that the license has been used to write controlled business. Which of the following would be a violation of controlled business practices?

    <p>Writing only policies for family members</p> Signup and view all the answers

    If an insurance company wishes to order a consumer report for underwriting, which of the following statements is true?

    <p>Information about race must be excluded</p> Signup and view all the answers

    Every insurance company in New York must file annually with the office of the Superintendent to show that it is what?

    <p>Solvent</p> Signup and view all the answers

    According to New York law, hearings ordered by the Superintendent must be open to the public.

    <p>True</p> Signup and view all the answers

    For which of the following reasons can a temporary license be issued?

    <p>To service the existing business</p> Signup and view all the answers

    Study Notes

    Insurance Agent Licensing in New York

    • Insurance agents must renew their licenses every 2 years.
    • Licenses for agents born in odd years expire on odd birthdays; even years have the same rule.
    • Continuing education requirement: 15 hours of approved instruction every 2 years.
    • Agents have 30 days to notify the Superintendent of a change of address.

    Regulatory Acts and Compliance

    • Cybersecurity Policy is an essential document for safeguarding insurers' information systems.
    • Fair Credit Reporting Act mandates insurers provide the name and address of the reporting agency if an applicant is denied insurance based on their report.
    • Insurance Frauds Prevention Act requires insurers to file a fraud prevention plan within 120 days, not 150.
    • Any agent who has their license revoked can reapply after one year.
    • Temporary licenses are not available for an agent's retirement but can be issued for servicing existing business.

    Unfair Trade Practices

    • False advertising refers to circulating deceptive sales materials to the public.
    • Rebating involves offering incentives, like tickets to an event, contingent on policy purchases.
    • Illegal practices include making misleading statements about competition and guaranteeing policies through state Guaranty Associations.
    • Discrimination occurs when two parties in the same risk class are charged different rates for unreasonable factors.

    Agent Responsibilities and Ownership

    • Agents represent insurance companies and have a fiduciary responsibility to their clients.
    • Agents must file a statement with the Superintendent within 30 days if their certificate of appointment is terminated.
    • It's illegal for insurers to make false statements regarding the financial condition of competitors (defamation).

    Claims and Investigations

    • Denying a claim after a proof of loss statement is submitted is not considered an improper claims practice.
    • The Superintendent has the authority to investigate fraud claims, even those originating outside the state.

    Guaranty Associations

    • These entities protect policyowners and beneficiaries if insurers fail to meet obligations due to financial issues.

    Misconduct and Regulatory Violations

    • Actions like forgery may lead to revocation of an agent's license.
    • Limitations exist on the amount of controlled business an agent can write, which cannot exceed 10% of their aggregate commissions.

    Licensing Exceptions and Qualifications

    • Not all individuals must pass a written examination; for example, insurer officers do not fall under this requirement.
    • Licensure qualifications do not include the necessity for a letter of recommendation regarding trustworthiness.

    Annual and Public Requirements

    • Insurance companies must file annually to demonstrate solvency.
    • Hearings ordered by the Superintendent must be open to public attendance.

    Discrimination and Rating Factors

    • Asking about sexual orientation and using it to determine insurance rates constitutes unfair discrimination.
    • Discrimination based on personal lifestyle factors, such as smoking habits, is permissible.

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    Description

    Test your knowledge of insurance regulations with these flashcards from Chapter 9. The quiz covers topics such as license renewal requirements for insurance agents in New York. Prepare for your insurance exam by familiarizing yourself with critical regulations and definitions.

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