Insurance MCQ

The Commissioner conducts an examination of a domestic insurer and believes that the cost of examination places an unreasonable financial burden on the insurer. Which of the following will happen? A. The costs will be reduced to the amount hat the examiner can reasonably pay; the rest will be paid by the federal government B. The Commissioner's office may pay all or part of the costs C. The federal government will absorb the full cost D. The federal government will absorb part of the cost, and the state government will absorb the rest of the cost Answer: B. The Commissioner's office may pay all or part of the costs

Which of the following is not a limited line of insurance? A. Legal expense insurance B. Life insurance C. Credit insurance D. Title insurance Answer: B. Life insurance

What is the maximum number of insurance risks an agent can place with a single insurer in one calendar year if the agent is not listed with that insurer? A. 7 B. 10 C. 3 D. 5 Answer: D. 5

Under which of the following would the Commissioner grant a requested re-hearing? A. The aggrieved person supplies a petition of 50 intermediaries licensed to transact insurance in Wisconsin B. The Governor files an appeal C. The aggrieved person files a claim against the Office of the Commissioner of Insurance's errors and omissions insurance coverage D. New evidence is discovered Answer: D. New evidence is discovered

Which of the following is a person who receives a fee or commission to attempt to negotiate settlements between a life insurance policyholder or certificate holder and one or more viatical settlement providers? A. Viatical settlement broker B. Viatical claims settlement adjuster C. Viatical claims settlement mediator D. Viatical settlement intermediary Answer: A. Viatical settlement broker

The XYZ Insurance Company markets standard accident and health as a Medicare supplement policy. The company is guilty of A. Nothing B. Misrepresentation C. Coercion D. Rebating Answer: B. Misrepresentation

Life settlements sold in Wisconsin must allow for the rescission of the contract within A. 10 days B. 15 days C. 20 days D. 30 days Answer: D. 30 days

How long are oral contracts valid in Wisconsin? A. 30 days B. Oral contracts are not valid C. 48 hours D. 3 business days Answer: A. 30 days

Which of the following is an intermediary who acts on behalf of the insurer he/she represents? A. Managing general intermediary B. Managing general representative C. Agent D. Broker Answer: C. Agent

Insurance regulations in this state require prompt initiation and completion of claims investigations, and delivery of necessary claims forms and assistance to the insured and claimants. What constitutes prompt action? A. 30 days B. The timeframe may be defined by each insurer C. 5 business days D. 10 consecutive days Answer: D. 10 consecutive days

Which of the following is an intermediary who acts on behalf of the insurer? A. Insurance agent B. Managing general representative C. Managing general intermediary D. Insurance broker Answer: A. Insurance agent

State law specifically prohibits using illegal inducements in the marketing of insurance. All of the following would be considered illegal inducements EXCEPT A. Promising returns and profits from the purchase of insurance B. Offering benefit certificates or securities in return for purchasing insurance C. Inviting prospective clients to the grand opening of the company's new office D. Issuing or delivering insurance company stock in return for purchasing insurance Answer: C. Inviting prospective clients to the grand opening of the company's new office

The Commissioner is required to examine every domestic insurer and every licensed rate service organization every A. 1 year B. 2 years C. 3 years D. 5 years Answer: D. 5 years

What document grants express authority to an agent? A. Agent's contract with the principal B. Agent's insurance license C. Fiduciary contract D. State provisions Answer: A. Agent's contract with the principal

What is the maximum annual billing for an insurer? A. 2% of gross premium B. 3% of interest C. 5% interest D. 1% of net premiums earned Answer: D. 1% of net premiums earned

An intermediary must maintain records for how long? A. 3 years B. 5 years C. 10 years D. Permanently Answer: A. 3 years

Pertaining to insurance, what is the definition of a fiduciary responsibility? A. Offering additional coverage to clients B. Promptly forwarding premiums to the insurance company C. Helping insureds to file claims D. Performing reviews of insured's coverage Answer: B. Promptly forwarding premiums to the insurance company

An insurer decides to renew a policy but at a higher premium rate, starting on the renewal date. How many days in advance must the insured be notified? A. 90 B. 100 C. 30 D. 60 Answer: D. 60

All of the following are true regarding rebates EXCEPT A. Dividends are not considered to be rebates B. Rebates are allowed if it's in the best interest of the client C. Rebates are only allowed if specifically stated in the policy D. Rebating can be anything of economic value, given as an inducement to buy Answer: B. Rebates are allowed if it's in the best interest of the client

Tim and Tom are twins. When they applied for life insurance from Company A, the insurance company found that while neither of them smoked and both have a very similar lifestyle, Tim was in much stronger financial position than Tom. Because of this, the company charged Tim a higher rate for his insurance. This practice would be A. Twisting B. Interdependent sale C. Post underwriting D. Discrimination Answer: D. Discrimination