PROPERTY AND CASUALTY EXAM-
ILLINOIS LAWS AND REGULATIONS
QUESTIONS AND ANSWERS WITH
COMPLETE SOLUTIONS 100%
CORRECT RATED A+
Question 1: Under state insurance codes, an individual is legally required to hold
an active insurance producer license to engage in which of the following
professional activities?
A) Soliciting (asking a person to apply), negotiating (conferring, offering
advice, or quoting rates), and selling (binding or renewing policies) ✔✔
B) Giving professional insurance advice for a fee or receiving a commission
for placing a policy ✔✔
C) Acting as a broker to arrange policies through insurance companies
where they do not have a direct agency contract ✔✔
D) All of the above operational and commercial activities ✔✔
Note: Depending on the specific test format, if this is structured as a single
comprehensive answer or an "All of the above" selection, any or all of these
activities explicitly trigger the regulatory requirement for licensure.
Question 2: In the insurance industry, which of the following best describes the
professional role and function of an insurance broker?
A) A captive agent who is legally restricted to writing policies for only one
specific insurance carrier
B) A licensed producer who independently arranges insurance policies for
clients through companies with which they do not hold a direct agency
contract ✔✔
C) A state regulatory official responsible for auditing the financial solvency
of local insurance firms
, D) An unlicensed administrative employee who processes premium
payments at an agency front desk
Question 3: To comply with state transparency and disclosure laws, what
identification requirement must be met when a policy is finalized and issued to a
consumer?
A) Only the financial assets and corporate board members of the insurance
carrier must be declared
B) All insurance producers, limited lines producers, temporary licensees, or
business entities involved in the sale must be clearly identified within the
policy documents ✔✔
C) The social security numbers of all agency employees must be printed on
the front of the binder
D) Only the name of the state insurance commissioner who approved the
form must be visible
Disclosure applies if sale was made by: -ANSWER ✔✔1. Insurance producer in
person
2. call center phone insurance producer
3. online internet insurance producer
Penalty for not being licensed -ANSWER ✔✔1. Class A misdemeanor
2. Class 4 felony
3. Injunction (restraining form selling insurance)
Penalty for not being licensed- Class A misdemeanor -ANSWER ✔✔Acting as an
insurance agent without license- fine up to $1,000 or 1 year in jail (1 and 1)
, Penalty for not being licensed- Class 4 felony -ANSWER ✔✔Acting as an
insurance agent without a license AND misappropriating premiums- fine up to 5k
and/or up to 5 years in jail (5 and 5)
Insurance producer license qualification -ANSWER ✔✔1. at least 18
2. not committed acts that would be grounds for suspension, revocation, denial of
license
3. Pass state exam
4. Purpose is NOT to sell controlled business
Controlled business -ANSWER ✔✔insurance sold to oneself, spouse, employer or
persons own business
Pre license requirements -ANSWER ✔✔1. 20 hours of pre edu per line- 7.5 class,
12.5 self
2. Motor vehicle insurance- 12.5 hours only- 5 class, 7.5 self
3. State certified course
4. proof of completion
Insurance continuing education -ANSWER ✔✔24 hours continuous edu every 2
year license term-
-3 hours ethics (classroom or webinar)
- can be computer based interactive or classroom
- self-study- open book final exam
Business Entity -ANSWER ✔✔"Insurance agency"
ILLINOIS LAWS AND REGULATIONS
QUESTIONS AND ANSWERS WITH
COMPLETE SOLUTIONS 100%
CORRECT RATED A+
Question 1: Under state insurance codes, an individual is legally required to hold
an active insurance producer license to engage in which of the following
professional activities?
A) Soliciting (asking a person to apply), negotiating (conferring, offering
advice, or quoting rates), and selling (binding or renewing policies) ✔✔
B) Giving professional insurance advice for a fee or receiving a commission
for placing a policy ✔✔
C) Acting as a broker to arrange policies through insurance companies
where they do not have a direct agency contract ✔✔
D) All of the above operational and commercial activities ✔✔
Note: Depending on the specific test format, if this is structured as a single
comprehensive answer or an "All of the above" selection, any or all of these
activities explicitly trigger the regulatory requirement for licensure.
Question 2: In the insurance industry, which of the following best describes the
professional role and function of an insurance broker?
A) A captive agent who is legally restricted to writing policies for only one
specific insurance carrier
B) A licensed producer who independently arranges insurance policies for
clients through companies with which they do not hold a direct agency
contract ✔✔
C) A state regulatory official responsible for auditing the financial solvency
of local insurance firms
, D) An unlicensed administrative employee who processes premium
payments at an agency front desk
Question 3: To comply with state transparency and disclosure laws, what
identification requirement must be met when a policy is finalized and issued to a
consumer?
A) Only the financial assets and corporate board members of the insurance
carrier must be declared
B) All insurance producers, limited lines producers, temporary licensees, or
business entities involved in the sale must be clearly identified within the
policy documents ✔✔
C) The social security numbers of all agency employees must be printed on
the front of the binder
D) Only the name of the state insurance commissioner who approved the
form must be visible
Disclosure applies if sale was made by: -ANSWER ✔✔1. Insurance producer in
person
2. call center phone insurance producer
3. online internet insurance producer
Penalty for not being licensed -ANSWER ✔✔1. Class A misdemeanor
2. Class 4 felony
3. Injunction (restraining form selling insurance)
Penalty for not being licensed- Class A misdemeanor -ANSWER ✔✔Acting as an
insurance agent without license- fine up to $1,000 or 1 year in jail (1 and 1)
, Penalty for not being licensed- Class 4 felony -ANSWER ✔✔Acting as an
insurance agent without a license AND misappropriating premiums- fine up to 5k
and/or up to 5 years in jail (5 and 5)
Insurance producer license qualification -ANSWER ✔✔1. at least 18
2. not committed acts that would be grounds for suspension, revocation, denial of
license
3. Pass state exam
4. Purpose is NOT to sell controlled business
Controlled business -ANSWER ✔✔insurance sold to oneself, spouse, employer or
persons own business
Pre license requirements -ANSWER ✔✔1. 20 hours of pre edu per line- 7.5 class,
12.5 self
2. Motor vehicle insurance- 12.5 hours only- 5 class, 7.5 self
3. State certified course
4. proof of completion
Insurance continuing education -ANSWER ✔✔24 hours continuous edu every 2
year license term-
-3 hours ethics (classroom or webinar)
- can be computer based interactive or classroom
- self-study- open book final exam
Business Entity -ANSWER ✔✔"Insurance agency"
