Chapter Exam: South Dakota Health Laws and Rules
Questions and Answers with 100% Correct Answers
Question 1.
The authority for a producer to bind an insurer to an insur- ance contract is found in the:
Correct Answer: Producers Appointment The correct answer is "producer's
appointment". A producer's authority to bind an insurer to an insurance contract
may be granted in the producer's appointment with the insurance com- pany.
Question 2.
The "Notice to buyer" on the first page of each long-term care policy delivered in South
Dakota
Correct Answer: explains that some long term care costs may not be covered
Correct. The "Notice to buyer" on the first page of each long term care policy
explains that some long term care costs may not be covered. The buyer is advised
to review all policy limitations.
Question 3.
The Director has reason to be- lieve a producer is in viola- tion of South Dakota insur-
ance law. Which of the follow- ing may be issued against the producer?
Correct Answer: Cease and desist order Correct. The Director has the authority to
issue a cease and desist order against a producer at a hearing if he/she believes the
producer has broken an insurance law.
Question 4.
What is the best definition of a producer?
Correct Answer: An individual appointed by an insurance company that repre-
sents the company and presents policies on its behalf
Question 5.
Which entity is responsible for regulating claims settlement practices of insurers?
Correct Answer: State insurance departments "State insurance departments".
Claims settlement practices of insurers are regulated by state insurance
departments.
Question 6.
Under which circumstance may an insurer discontinue a small employer group medical
plan?
Correct Answer: Insurer discontinues offering the plan to all employers In South
Dakota, an insurer providing small employer group medical plans may discontinue
an employer's coverage if the insurer no longer offers the plan to any employer.
, Question 7.
Which of the following actions would be considered a felony in the State of South Dakota?
Correct Answer: Attempting to defraud an insurer
Question 8.
Which of the following indi- viduals is eligible to receive a temporary producer license?
Correct Answer: A designated employee who is replacing a deceased producer In
South Dakota, a designated employee who is replacing a de- ceased producer
would be eligible for a temporary producer's license.
Question 9.
Which of the following is a re- quirement for an individual to receive an insurance license
in South Dakota?
Correct Answer: Passing the appropriate examination An applicant must apply for
the license after passing the appro- priate examination in order to receive an
insurance license.
Question 10.
Which of the following is con- sidered to be an unfair claims settlement practice?
Correct Answer: Misrepresenting pertinent policy provisions relating to cover- age
after a loss
Question 11.
Which of the following is NOT considered to be an unfair trade practice?
Correct Answer: Replacement
Question 12.
Which of these is NOT a pun- ishment for committing an unfair and deceptive insur- ance
practice?f
Correct Answer: Community Service
Question 13.
Which of these is NOT an Un- fair Claims Settlement Prac- tice?
Correct Answer: Offering to settle a claim by arbitration
Question 14.
A producer MUST notify the Director for
Correct Answer: conducting business under an assumed name "conducting
business under an assumed name". An insurance producer who intends to do
business in South Dakota under any name other than the producer's legal name
must notify the Director before using the assumed name.
Questions and Answers with 100% Correct Answers
Question 1.
The authority for a producer to bind an insurer to an insur- ance contract is found in the:
Correct Answer: Producers Appointment The correct answer is "producer's
appointment". A producer's authority to bind an insurer to an insurance contract
may be granted in the producer's appointment with the insurance com- pany.
Question 2.
The "Notice to buyer" on the first page of each long-term care policy delivered in South
Dakota
Correct Answer: explains that some long term care costs may not be covered
Correct. The "Notice to buyer" on the first page of each long term care policy
explains that some long term care costs may not be covered. The buyer is advised
to review all policy limitations.
Question 3.
The Director has reason to be- lieve a producer is in viola- tion of South Dakota insur-
ance law. Which of the follow- ing may be issued against the producer?
Correct Answer: Cease and desist order Correct. The Director has the authority to
issue a cease and desist order against a producer at a hearing if he/she believes the
producer has broken an insurance law.
Question 4.
What is the best definition of a producer?
Correct Answer: An individual appointed by an insurance company that repre-
sents the company and presents policies on its behalf
Question 5.
Which entity is responsible for regulating claims settlement practices of insurers?
Correct Answer: State insurance departments "State insurance departments".
Claims settlement practices of insurers are regulated by state insurance
departments.
Question 6.
Under which circumstance may an insurer discontinue a small employer group medical
plan?
Correct Answer: Insurer discontinues offering the plan to all employers In South
Dakota, an insurer providing small employer group medical plans may discontinue
an employer's coverage if the insurer no longer offers the plan to any employer.
, Question 7.
Which of the following actions would be considered a felony in the State of South Dakota?
Correct Answer: Attempting to defraud an insurer
Question 8.
Which of the following indi- viduals is eligible to receive a temporary producer license?
Correct Answer: A designated employee who is replacing a deceased producer In
South Dakota, a designated employee who is replacing a de- ceased producer
would be eligible for a temporary producer's license.
Question 9.
Which of the following is a re- quirement for an individual to receive an insurance license
in South Dakota?
Correct Answer: Passing the appropriate examination An applicant must apply for
the license after passing the appro- priate examination in order to receive an
insurance license.
Question 10.
Which of the following is con- sidered to be an unfair claims settlement practice?
Correct Answer: Misrepresenting pertinent policy provisions relating to cover- age
after a loss
Question 11.
Which of the following is NOT considered to be an unfair trade practice?
Correct Answer: Replacement
Question 12.
Which of these is NOT a pun- ishment for committing an unfair and deceptive insur- ance
practice?f
Correct Answer: Community Service
Question 13.
Which of these is NOT an Un- fair Claims Settlement Prac- tice?
Correct Answer: Offering to settle a claim by arbitration
Question 14.
A producer MUST notify the Director for
Correct Answer: conducting business under an assumed name "conducting
business under an assumed name". An insurance producer who intends to do
business in South Dakota under any name other than the producer's legal name
must notify the Director before using the assumed name.
