LOMA 311 FINAL PAPER 2026 DETAILED
QUESTIONS ACCURATE ANSWERS
PREMIUM QUALITY
◉ National Association of Registered Agents and Brokers Reform Act
of 2015 (NARAB II)
Answer: serves as a national clearinghouse for licensing insurance
agents so that they can sell insurance in more than one state.
◉ unfair trade practice acts
Answer: defines certain practices, including sales practices, as unfair.
These insurance laws prohibit practices in the business of insurance
if the practices are committed (1) flagrantly in conscious disregard
of the act or (2) so frequently as to indicate a general business
practice.
Prohibited activities include:
= Defamation of any insurer
=False statements and false entries in books or records
= Unfair discrimination
,=Rebating, which is a sales practice in which
an insurance agent offers a prospect an inducement, such as all or
part of the agent's commission, to purchase a policy from the agent
when the inducement is (1) not offered to all applicants in similar
situations and
(2) not stated in the policy
◉ replacements
Answer: In many states, the Unfair Trade Practices Act governs
replacements by prohibiting misrepresentations. Also, most states
have specific regulations that apply to replacements. Typically, these
regulations are based on the NAIC Life Insurance and Annuities
Replacement Model Regulation (Model Replacement Regulation).
The goal of the Model Replacement Regulation is to make sure that
insurers and insurance agents provide consumers with fair and
accurate information about policies so that consumers can make
informed decisions.
Insurance Agents:
an insurance agent must submit a replacement statement along with
every application for a policy intended to replace an in-force
individual life insurance policy or annuity contract. The applicant
and the agent must sign this statement. The statement indicates
whether the policy applied for will replace an in-force policy.
If the applicant has an in-force policy that is subject to the Model
Replacement Regulation, then the agent has a number of other
, duties. One such duty is to give the applicant a written notice
regarding replacement. This notice includes general information
about the potential effect of a replacement. It advises the applicant
to consider all the relevant facts before making a replacement. Both
the applicant and the agent must sign this notice.
INSURERS:
when an insurer uses direct response solicitations in which no agent
is involved, the insurer must ask an applicant whether he intends to
replace an existing policy. If so, the insurer must provide the
applicant with a notice regarding replacement and must make an
effort to secure a copy of the notice signed by the applicant.
Insurance companies that use
insurance agents to sell insurance are required to oversee the
activities of their agents and to ensure that agents submit required
statements and notices.
Whe
◉ Variable Life Insurance Model Regulation.
Answer: This model regulation sets the qualifications an insurer
must meet and the requirements variable life insurance policies
must meet before the insurer can market these policies in the state.
The regulation also requires the insurer to specify the standards of
suitability it will follow when selling variable life insurance.
QUESTIONS ACCURATE ANSWERS
PREMIUM QUALITY
◉ National Association of Registered Agents and Brokers Reform Act
of 2015 (NARAB II)
Answer: serves as a national clearinghouse for licensing insurance
agents so that they can sell insurance in more than one state.
◉ unfair trade practice acts
Answer: defines certain practices, including sales practices, as unfair.
These insurance laws prohibit practices in the business of insurance
if the practices are committed (1) flagrantly in conscious disregard
of the act or (2) so frequently as to indicate a general business
practice.
Prohibited activities include:
= Defamation of any insurer
=False statements and false entries in books or records
= Unfair discrimination
,=Rebating, which is a sales practice in which
an insurance agent offers a prospect an inducement, such as all or
part of the agent's commission, to purchase a policy from the agent
when the inducement is (1) not offered to all applicants in similar
situations and
(2) not stated in the policy
◉ replacements
Answer: In many states, the Unfair Trade Practices Act governs
replacements by prohibiting misrepresentations. Also, most states
have specific regulations that apply to replacements. Typically, these
regulations are based on the NAIC Life Insurance and Annuities
Replacement Model Regulation (Model Replacement Regulation).
The goal of the Model Replacement Regulation is to make sure that
insurers and insurance agents provide consumers with fair and
accurate information about policies so that consumers can make
informed decisions.
Insurance Agents:
an insurance agent must submit a replacement statement along with
every application for a policy intended to replace an in-force
individual life insurance policy or annuity contract. The applicant
and the agent must sign this statement. The statement indicates
whether the policy applied for will replace an in-force policy.
If the applicant has an in-force policy that is subject to the Model
Replacement Regulation, then the agent has a number of other
, duties. One such duty is to give the applicant a written notice
regarding replacement. This notice includes general information
about the potential effect of a replacement. It advises the applicant
to consider all the relevant facts before making a replacement. Both
the applicant and the agent must sign this notice.
INSURERS:
when an insurer uses direct response solicitations in which no agent
is involved, the insurer must ask an applicant whether he intends to
replace an existing policy. If so, the insurer must provide the
applicant with a notice regarding replacement and must make an
effort to secure a copy of the notice signed by the applicant.
Insurance companies that use
insurance agents to sell insurance are required to oversee the
activities of their agents and to ensure that agents submit required
statements and notices.
Whe
◉ Variable Life Insurance Model Regulation.
Answer: This model regulation sets the qualifications an insurer
must meet and the requirements variable life insurance policies
must meet before the insurer can market these policies in the state.
The regulation also requires the insurer to specify the standards of
suitability it will follow when selling variable life insurance.
