Colorado Title 83 Insurance Practice Exam 100 Multiple Choice Questions with
Answers & Explanations
**Disclaimer:** This practice exam is for educational purposes to help prepare for the
Colorado Title 83 insurance licensing exam. It is based on common insurance principles
and general Colorado-specific regulations as found in study materials. Always refer to the
official Colorado Division of Insurance (DOI) statutes, rules, and bulletins, as well as your
pre-licensing coursework materials, for the most current and accurate information.
---
**1. According to Colorado insurance law, who is considered an "insurance producer"?**
A) Only a person who sells life insurance
B) A person required to be licensed to sell, solicit, or negotiate insurance
C) A person who only adjusts claims
D) A salaried employee of an insurance company
**Answer: B) A person required to be licensed to sell, solicit, or negotiate insurance**
**Explanation:** Colorado law defines an "insurance producer" as a person required to be
licensed under the laws of this state to sell, solicit, or negotiate insurance.
**2. In Colorado, how long must an insurance producer maintain records of all
transactions for review by the Commissioner?**
A) 1 year
B) 3 years
C) 5 years
D) 7 years
**Answer: C) 5 years**
,**Explanation:** Colorado requires producers to maintain records of all insurance
transactions for a period of five years from the date the policy expires or is cancelled.
**3. The purpose of a "Notice of Insurance Information Practices" in Colorado is to inform
applicants and policyholders:**
A) Of the insurer's underwriting guidelines
B) That their personal information may be collected and disclosed
C) Of their right to a premium refund
D) About the company's financial rating
**Answer: B) That their personal information may be collected and disclosed**
**Explanation:** This notice, required at the time of application, informs individuals about
the insurer's practices regarding the collection and disclosure of nonpublic personal
information.
**4. Which of the following activities would NOT require an insurance producer license in
Colorado?**
A) Soliciting an application for an annuity
B) Negotiating the terms of a commercial property policy
C) A customer service representative explaining a billing statement
D) Selling a health insurance policy to a small business
**Answer: C) A customer service representative explaining a billing statement**
**Explanation:** Activities limited to clerical or administrative support that do not involve
selling, soliciting, or negotiating insurance typically do not require a producer license.
**5. In Colorado, an insurance producer's license will expire if not renewed by:**
A) The producer's birthday
B) The last day of the birth month, every two years
C) December 31st of every even-numbered year
,D) The license anniversary date
**Answer: B) The last day of the birth month, every two years**
**Explanation:** Colorado producer licenses expire on the last day of the licensee's birth
month, biennially (every two years).
**6. What is the primary purpose of the Colorado FAIR Plan?**
A) To provide low-cost life insurance to high-risk individuals
B) To provide basic property insurance to those who cannot obtain it in the voluntary
market
C) To guarantee health insurance for all Colorado residents
D) To regulate insurance company investments
**Answer: B) To provide basic property insurance to those who cannot obtain it in the
voluntary market**
**Explanation:** The FAIR (Fair Access to Insurance Requirements) Plan is a state-
mandated program that provides essential property insurance (like fire, extended coverage,
vandalism) to property owners who are unable to obtain coverage in the standard market.
**7. A producer in Colorado must notify the Commissioner of a change of address within:**
A) 10 days
B) 30 days
C) 60 days
D) 90 days
**Answer: B) 30 days**
**Explanation:** Colorado law requires a licensed producer to notify the Commissioner of
Insurance in writing of any change in their business or residential address within 30 days of
the change.
, **8. Which of the following is considered an unfair claims settlement practice in
Colorado?**
A) Paying a claim within 30 days of receiving proof of loss
B) Failing to affirm or deny coverage within a reasonable time after proof of loss
C) Using approved appraisal to determine loss value
D) Requiring a sworn statement from the insured
**Answer: B) Failing to affirm or deny coverage within a reasonable time after proof of
loss**
**Explanation:** The Colorado Unfair Claims Settlement Practices Act outlines specific
prohibited acts, including not acknowledging or acting promptly upon communications,
failing to affirm or deny coverage within a reasonable time, and not attempting in good faith
to settle claims promptly and fairly.
**9. What is the minimum continuing education (CE) requirement for a Colorado resident
producer license renewal?**
A) 12 credit hours per renewal period
B) 18 credit hours per renewal period
C) 24 credit hours per renewal period
D) 36 credit hours per renewal period
**Answer: C) 24 credit hours per renewal period**
**Explanation:** Colorado requires resident producers to complete 24 hours of approved
continuing education every two-year license term, including 3 hours in ethics.
**10. A binder is a temporary agreement that provides insurance coverage until:**
A) The claim is paid
B) The policy is issued or declined
C) The premium is paid in full
D) The inspection is completed
Answers & Explanations
**Disclaimer:** This practice exam is for educational purposes to help prepare for the
Colorado Title 83 insurance licensing exam. It is based on common insurance principles
and general Colorado-specific regulations as found in study materials. Always refer to the
official Colorado Division of Insurance (DOI) statutes, rules, and bulletins, as well as your
pre-licensing coursework materials, for the most current and accurate information.
---
**1. According to Colorado insurance law, who is considered an "insurance producer"?**
A) Only a person who sells life insurance
B) A person required to be licensed to sell, solicit, or negotiate insurance
C) A person who only adjusts claims
D) A salaried employee of an insurance company
**Answer: B) A person required to be licensed to sell, solicit, or negotiate insurance**
**Explanation:** Colorado law defines an "insurance producer" as a person required to be
licensed under the laws of this state to sell, solicit, or negotiate insurance.
**2. In Colorado, how long must an insurance producer maintain records of all
transactions for review by the Commissioner?**
A) 1 year
B) 3 years
C) 5 years
D) 7 years
**Answer: C) 5 years**
,**Explanation:** Colorado requires producers to maintain records of all insurance
transactions for a period of five years from the date the policy expires or is cancelled.
**3. The purpose of a "Notice of Insurance Information Practices" in Colorado is to inform
applicants and policyholders:**
A) Of the insurer's underwriting guidelines
B) That their personal information may be collected and disclosed
C) Of their right to a premium refund
D) About the company's financial rating
**Answer: B) That their personal information may be collected and disclosed**
**Explanation:** This notice, required at the time of application, informs individuals about
the insurer's practices regarding the collection and disclosure of nonpublic personal
information.
**4. Which of the following activities would NOT require an insurance producer license in
Colorado?**
A) Soliciting an application for an annuity
B) Negotiating the terms of a commercial property policy
C) A customer service representative explaining a billing statement
D) Selling a health insurance policy to a small business
**Answer: C) A customer service representative explaining a billing statement**
**Explanation:** Activities limited to clerical or administrative support that do not involve
selling, soliciting, or negotiating insurance typically do not require a producer license.
**5. In Colorado, an insurance producer's license will expire if not renewed by:**
A) The producer's birthday
B) The last day of the birth month, every two years
C) December 31st of every even-numbered year
,D) The license anniversary date
**Answer: B) The last day of the birth month, every two years**
**Explanation:** Colorado producer licenses expire on the last day of the licensee's birth
month, biennially (every two years).
**6. What is the primary purpose of the Colorado FAIR Plan?**
A) To provide low-cost life insurance to high-risk individuals
B) To provide basic property insurance to those who cannot obtain it in the voluntary
market
C) To guarantee health insurance for all Colorado residents
D) To regulate insurance company investments
**Answer: B) To provide basic property insurance to those who cannot obtain it in the
voluntary market**
**Explanation:** The FAIR (Fair Access to Insurance Requirements) Plan is a state-
mandated program that provides essential property insurance (like fire, extended coverage,
vandalism) to property owners who are unable to obtain coverage in the standard market.
**7. A producer in Colorado must notify the Commissioner of a change of address within:**
A) 10 days
B) 30 days
C) 60 days
D) 90 days
**Answer: B) 30 days**
**Explanation:** Colorado law requires a licensed producer to notify the Commissioner of
Insurance in writing of any change in their business or residential address within 30 days of
the change.
, **8. Which of the following is considered an unfair claims settlement practice in
Colorado?**
A) Paying a claim within 30 days of receiving proof of loss
B) Failing to affirm or deny coverage within a reasonable time after proof of loss
C) Using approved appraisal to determine loss value
D) Requiring a sworn statement from the insured
**Answer: B) Failing to affirm or deny coverage within a reasonable time after proof of
loss**
**Explanation:** The Colorado Unfair Claims Settlement Practices Act outlines specific
prohibited acts, including not acknowledging or acting promptly upon communications,
failing to affirm or deny coverage within a reasonable time, and not attempting in good faith
to settle claims promptly and fairly.
**9. What is the minimum continuing education (CE) requirement for a Colorado resident
producer license renewal?**
A) 12 credit hours per renewal period
B) 18 credit hours per renewal period
C) 24 credit hours per renewal period
D) 36 credit hours per renewal period
**Answer: C) 24 credit hours per renewal period**
**Explanation:** Colorado requires resident producers to complete 24 hours of approved
continuing education every two-year license term, including 3 hours in ethics.
**10. A binder is a temporary agreement that provides insurance coverage until:**
A) The claim is paid
B) The policy is issued or declined
C) The premium is paid in full
D) The inspection is completed
