WASHINGTON LAWS AND RULES PERTINENT TO
INSURANCE EXAM {GRADED A}
•
Violations of US Code Title 18 section 1033, may result in - CORRECT
ANSWER Fine and/or imprisonment
Charles is a producer who is licensed in Washington but resides in
Oregon. Charles is considered to be a(n) - CORRECT ANSWER Nonresident
producer
Before a producer may sell, solicit, or negotiate insurance from an
insurer, the producer must have a(n) - CORRECT ANSWER Appointment
The act of using misrepresentation to induce an insured person to
terminate an existing policy and purchase a new policy is referred to
as - CORRECT ANSWER Twisting
An example of an unfair claims settlement practice is - CORRECT ANSWER
Turning down a claim without providing the basis of denial
One role of the Commissioner is to - CORRECT ANSWER Enforce state
insurance laws
Every producer licensed in Washington must notify the Commissioner
within ___ days of any change of the address. - CORRECT ANSWER 30
The identity of the _____ must be made clear in every health (disability)
insurance advertisement. - CORRECT ANSWER Insurer
A life insurance policy becomes incontestable after it has been in
force for - CORRECT ANSWER 2 years
,Advertising regulations exist to - CORRECT ANSWER Assure full and
truthful disclosures to the public
When a Medicare Supplement insurance policy is being replaced, who
must sign the notice of replacement? - CORRECT ANSWER The producer
and the applicant
What is the MINIMUM benefit period that must be offered by a Long-
Term Care policy? - CORRECT ANSWER 12 months
No legal action can be initiated after ___ years from the initial time
written proof of loss has been provided. - CORRECT ANSWER 3
When replacing a life insurance policy, a producer must provide the
applicant with a - CORRECT ANSWER Notice Regarding Replacement
A Medicare Supplement policy can be cancelled by the insurer for -
CORRECT ANSWER Nonpayment
A company that is chartered and organized of the state in which its
home office is located is called a(n) - CORRECT ANSWER Domestic insurer
An insurance company may only pay commissions to a(n) - CORRECT
ANSWER Licensed producer appointed by the insurer
An example of an Unfair Claims Settlement practice is - CORRECT ANSWER
Failing to promptly provide reasonable explanations for the denial of
claims
An insurance company that has qualified and received a Certificate of
Authority from the Insurance Department to sell insurance in this state
is called a(n) - CORRECT ANSWER Authorized insurer
Replacement can be BEST described as - CORRECT ANSWER Exchanging
a new policy for one already in force
An insurer may exclude preexisting conditions on a Medicare
Supplement policy for ___ months. - CORRECT ANSWER 6
,What is the purpose of the Washington Life and Disability Insurance
Guaranty Association? - CORRECT ANSWER Ensures that claims filed
against insolvent insurance companies will be paid
An example of rebating is - CORRECT ANSWER A producer who shares
commissions with a client
The required grace period for life insurance policies sold in
Washington is - CORRECT ANSWER 30 days
Kiara filled out a life insurance application and was given a policy
illustration that showed future premiums being paid out of
nonguaranteed values. This illustration MUST disclose that - CORRECT
ANSWER She may need to resume premium payments, depending on
actual results
Which of the following is required for an insurer to conduct business in
this state? - CORRECT ANSWER Certificate of Authority
Which of the following is an example of a producer's fiduciary duty? -
CORRECT ANSWER Recording receipt and remittance of premiums due to
the insurance company
The _____ is responsible for determining the appropriateness of a
Medicare Supplement policy for an applicant - CORRECT ANSWER
Producer
Which of the following is NOT considered to be an act of "transacting
insurance"? - CORRECT ANSWER Gathering prospective buyer information
In the event of a controversy between the insured and the company,
the producer is considered to represent the - CORRECT ANSWER Company
Inducement is BEST defined as - CORRECT ANSWER Offering to buy, sell,
give, or allow a prospective insurance employment, stock or special
favors in exchange for an insurance contract
, Which of these is NOT an Unfair Claims Settlement practice? - CORRECT
ANSWER Settling a claim by arbitration
The Life and Disability Guaranty Association provides funds to carry
out its powers and duties by assessing - CORRECT ANSWER Member
insurers
Which of these is not a characteristic of a Fraternal Benefit Society -
CORRECT ANSWER Exists for profit
What provision states that the policy and application shall constitute
the entire contract between parties? - CORRECT ANSWER Entire contract
Which of the following unfair trade practices involves a producer who
makes public, malicious statements about an insurer's financial
condition? - CORRECT ANSWER Defamation
A foreign insurance company doing business in Washington - CORRECT
ANSWER Is a company that was formed under the laws of another state
An insurer is REQUIRED to offer which of the following to each long-
term care applicant at the time of purchase? - CORRECT ANSWER
Inflation protection
Tim's individual life insurance policy has just recently lapsed. His
policy may be reinstated at any time within ___ year(s) - CORRECT ANSWER
3
Which of the following is CORRECT regarding disclosure regulation? -
CORRECT ANSWER It requires the delivery of a buyer's guide and a
disclosure document to applicants
Under which circumstances may a commission be shared between
two producers? - CORRECT ANSWER When they are both licensed in the
same line of business
INSURANCE EXAM {GRADED A}
•
Violations of US Code Title 18 section 1033, may result in - CORRECT
ANSWER Fine and/or imprisonment
Charles is a producer who is licensed in Washington but resides in
Oregon. Charles is considered to be a(n) - CORRECT ANSWER Nonresident
producer
Before a producer may sell, solicit, or negotiate insurance from an
insurer, the producer must have a(n) - CORRECT ANSWER Appointment
The act of using misrepresentation to induce an insured person to
terminate an existing policy and purchase a new policy is referred to
as - CORRECT ANSWER Twisting
An example of an unfair claims settlement practice is - CORRECT ANSWER
Turning down a claim without providing the basis of denial
One role of the Commissioner is to - CORRECT ANSWER Enforce state
insurance laws
Every producer licensed in Washington must notify the Commissioner
within ___ days of any change of the address. - CORRECT ANSWER 30
The identity of the _____ must be made clear in every health (disability)
insurance advertisement. - CORRECT ANSWER Insurer
A life insurance policy becomes incontestable after it has been in
force for - CORRECT ANSWER 2 years
,Advertising regulations exist to - CORRECT ANSWER Assure full and
truthful disclosures to the public
When a Medicare Supplement insurance policy is being replaced, who
must sign the notice of replacement? - CORRECT ANSWER The producer
and the applicant
What is the MINIMUM benefit period that must be offered by a Long-
Term Care policy? - CORRECT ANSWER 12 months
No legal action can be initiated after ___ years from the initial time
written proof of loss has been provided. - CORRECT ANSWER 3
When replacing a life insurance policy, a producer must provide the
applicant with a - CORRECT ANSWER Notice Regarding Replacement
A Medicare Supplement policy can be cancelled by the insurer for -
CORRECT ANSWER Nonpayment
A company that is chartered and organized of the state in which its
home office is located is called a(n) - CORRECT ANSWER Domestic insurer
An insurance company may only pay commissions to a(n) - CORRECT
ANSWER Licensed producer appointed by the insurer
An example of an Unfair Claims Settlement practice is - CORRECT ANSWER
Failing to promptly provide reasonable explanations for the denial of
claims
An insurance company that has qualified and received a Certificate of
Authority from the Insurance Department to sell insurance in this state
is called a(n) - CORRECT ANSWER Authorized insurer
Replacement can be BEST described as - CORRECT ANSWER Exchanging
a new policy for one already in force
An insurer may exclude preexisting conditions on a Medicare
Supplement policy for ___ months. - CORRECT ANSWER 6
,What is the purpose of the Washington Life and Disability Insurance
Guaranty Association? - CORRECT ANSWER Ensures that claims filed
against insolvent insurance companies will be paid
An example of rebating is - CORRECT ANSWER A producer who shares
commissions with a client
The required grace period for life insurance policies sold in
Washington is - CORRECT ANSWER 30 days
Kiara filled out a life insurance application and was given a policy
illustration that showed future premiums being paid out of
nonguaranteed values. This illustration MUST disclose that - CORRECT
ANSWER She may need to resume premium payments, depending on
actual results
Which of the following is required for an insurer to conduct business in
this state? - CORRECT ANSWER Certificate of Authority
Which of the following is an example of a producer's fiduciary duty? -
CORRECT ANSWER Recording receipt and remittance of premiums due to
the insurance company
The _____ is responsible for determining the appropriateness of a
Medicare Supplement policy for an applicant - CORRECT ANSWER
Producer
Which of the following is NOT considered to be an act of "transacting
insurance"? - CORRECT ANSWER Gathering prospective buyer information
In the event of a controversy between the insured and the company,
the producer is considered to represent the - CORRECT ANSWER Company
Inducement is BEST defined as - CORRECT ANSWER Offering to buy, sell,
give, or allow a prospective insurance employment, stock or special
favors in exchange for an insurance contract
, Which of these is NOT an Unfair Claims Settlement practice? - CORRECT
ANSWER Settling a claim by arbitration
The Life and Disability Guaranty Association provides funds to carry
out its powers and duties by assessing - CORRECT ANSWER Member
insurers
Which of these is not a characteristic of a Fraternal Benefit Society -
CORRECT ANSWER Exists for profit
What provision states that the policy and application shall constitute
the entire contract between parties? - CORRECT ANSWER Entire contract
Which of the following unfair trade practices involves a producer who
makes public, malicious statements about an insurer's financial
condition? - CORRECT ANSWER Defamation
A foreign insurance company doing business in Washington - CORRECT
ANSWER Is a company that was formed under the laws of another state
An insurer is REQUIRED to offer which of the following to each long-
term care applicant at the time of purchase? - CORRECT ANSWER
Inflation protection
Tim's individual life insurance policy has just recently lapsed. His
policy may be reinstated at any time within ___ year(s) - CORRECT ANSWER
3
Which of the following is CORRECT regarding disclosure regulation? -
CORRECT ANSWER It requires the delivery of a buyer's guide and a
disclosure document to applicants
Under which circumstances may a commission be shared between
two producers? - CORRECT ANSWER When they are both licensed in the
same line of business
