Insurance MCQ

Which of the following is NOT prohibited under the Unfair Practices section of insurance law: A.Misleading or false statements about dividends previously paid on an insurance policy B.Discriminating between insurance applicants on the basis of gender C.Readjusting group premium rates based on loss or expense experience D.Making false oral statements about the financial condition of a person which are calculated to injure that person Answer: C.Readjusting group premium rates based on loss or expense experience

All of the following are true regarding the federal Fair Credit Reporting Act EXCEPT: A.Reports may be sent to anyone who requests one B.Insurers are not required to give customers a copy of the report C.The customer must be notified if adverse action is taken as a result of a report D.It applies to credit reports ordered in connection with insurance, banking and employment Answer: A.Reports may be sent to anyone who requests one

When the applicant passes the exam and qualifies in all other respects except for the fingerprint check by the FBI, the Department of Insurance will issue a license called: Answer: Conditional

Which of the following indicates free competition is occurring: A.Commissions are fixed at the same level by all insurers B.All policy forms contain exactly the same coverage C.There are substantial differences between rate levels of various insurers D.All insurers are charging the same rates Answer: C.There are substantial differences between rate levels of various insurers

An insurer must acknowledge receipt of a Notice of Claim within _____ days: Answer: 10

If a license is revoked, the licensee shall NOT be eligible for a new license: Answer: For at least 5 years

To become a Texas insurance agent, you must: Answer: Pass an exam

The type of government primarily concerned with the regulation of insurance and insurance companies is: Answer: State government

Forcing a client to buy insurance from a particular lender as a condition of granting a loan is defined as: Answer: Coercion

Unfair claims practices will be assumed to be intentional if: Answer: They occur with such frequency as to indicate a general business practice

To obtain a Texas license, you must do all EXCEPT: A.Complete pre-license training B.Be fingerprinted C.Pass an exam D.Be 18 years of age Answer: A.Complete pre-license training

Which of the following statements regarding temporary licenses is FALSE: A.They are valid up to 90 days B.They may be renewed C.They require 40 hours of license training D.They may be issued without exam Answer: B.They may be renewed

An insurance company can have rates based on: Answer: Gender

Insurable interest must exist on property insurance: Answer: At time of loss

What is the maximum time a Texas insurance agent's license may be issued for: Answer: Two years

A Texas resident agent seeking to sell insurance to customers in another state needs: Answer: A non-resident license in that state

Regarding Claims Methods and Practices, all of the following are true EXCEPT: A.Insurers cannot deny unsubstantiated claims B.Insurers must conduct a reasonable investigation prior to denial of a claim C.Insurers may settle a claim by attempt to reach a compromise D.Insurers cannot require insureds to pay the costs of a claims investigation Answer: A.Insurers cannot deny unsubstantiated claims

A person appointed by an insurer to solicit or sell insurance on their behalf in this state is known as a(n): Answer: Agent

Making false or malicious statements about the financial condition of an insurer or agent is what type of Unfair Trade Practice: Answer: Defamation

If an agent's license is suspended or revoked, what happens to their accounts: Answer: They continue in force