Insurance Final Exam 2023 Test Bank Questions and Correct Answers.

Insurance Final Exam 2023 Test Bank Questions and Correct Answers. If the premiums for a policy will be increased by more than 15 percent, how much warning must the insured get? 45 days. A notice of increase in premiums that exceeds 15% of the current policy's premium must be delivered or mailed to the insured at least 45 days before the effective date of such termination or change. What is the max period of time a temp license can be in force? 15 months. A temp license is good for 6 months and can be renewed at 3 month intervals for a max of 15 months. The Commissioner of Insurance is... The chief officer of the Dep. of Insurance. If the insurer pays an amount less than the amount insured under the policy in the event of a total loss to property, how much of the insured's premium must the insurer return? The amount of premium actually paid and the premium that would have been charged for a policy with an amount of insurance equal to the amount paid by the insurer for the loss. Which type of liability insurance may an insured reject in writing? Uninsured motorist coverage. Which of the following is the closest term to an authorized insurer? Admitted. Insurers who meet the state's financial requirements and are approved to transact business in the state are considered authorized or admitted into the state as a legal insurer. If a policy has been in effect for at least 60 days or is due for renewal, a cancellation may only be effected for which of the following reasons? A change in the risk that substantially increases the hazard insured against. An agent license can be issued... Only to individuals. If a policy is cancelled due to nonpayment of premium, how many days' advance notice must the insurer give the policyholder before cancellation? 10 days. An insurer publishes intimidating brochures that portray the insurer's competition as financially and professionally unstable. The insurer is hoping that this advertising will help to eliminate the competition and therefore create a monopoly. Which of the following best describes this act? Illegal. It is illegal to be involved in any activity of boycott, coercion, or intimidation that is intended to restrict fair trade or to create a monopoly. How many days before a policy is nonrenewed must an insurer deliver or mail written notice to the insured? A15 days B20 days C30 days D10 days 30 days. Which of the following best describes an unfair trade practice of defamation? Making derogatory oral statements about another insurer's financial condition. Which type of workers are NOT covered under Workers Compensation? Domestic workers. Which of the following will NOT be considered unfair discrimination by insurers? Discriminating in benefits and coverages based on the insured's habits and lifestyle. Insurers are also not allowed to cancel individual coverage due to a change in marital status. Discriminating in benefits based on the insured's habits and lifestyle (such as smoking or dangerous hobbies) is acceptable. Which of the following are the authorities that an agent can hold? Expressed and Implied. The powers and authorities that an agent holds are express and implied. Apparent authority is the appearance of, or the assumption of, authority based on the actions, words, or deeds of the principal or because of circumstances the principal created. An insured purchased an insurance policy 5 years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insurer. From what type of insurer did the insured purchase the policy? Mutual. Funds not paid out after paying claims and other operating costs are returned to the policy owners in the form of a dividend. If all funds are paid out, no dividends are paid. Which of the following is an example of an agent's fiduciary responsibilities? Forwarding premiums to the insurer. Fiduciary refers to a position of trust. When an agent is handling the premiums that belong to an insurance company, they are acting in a fiduciary capacity. Which of the following insurers are owned by stockholders who have the usual rights of ownership, including the right of voting? Stock. Only stock insurance companies are owned and controlled by stockholders. Which of the following is NOT true regarding a Certificate of Authority? It is issued to group insurance participants. Before insurers may transact business in a specific state, they must apply for a license or Certificate of Authority from the state department of insurance and meet any financial (capital and surplus) requirements set down by the state. Two individuals are in the same risk and age class; yet, they are charged different rates for their insurance policies due to an insignificant factor. What is this called? Discrimination. Permitting individuals of the same class to be charged a different rate for the same insurance is the unfair trade practice of discrimination. How is the Commissioner of Insurance selected to be the chief officer of the Department of Insurance? Elected to office. The Commissioner is elected to office for a term of 4 years. Which of the following must an insurer obtain in order to transact insurance within a given state? Certificate of authority. All insurers (domestic, foreign, or alien) must obtain a certificate of authority before transacting insurance within a given state. On its advertisement, a company claims that it has funds in its possession that are, in fact, not available for the payment of losses or claims. The company is guilty of... Misrepresentation. Issuing or circulating any sales material that is false or misleading would be considered misrepresentation and illegal. Under workers compensation laws, injured workers are entitled to how many weeks of treatment from the date of the accident? 400 weeks. Medical treatment for injuries due to an on-the-job accident is limited to a maximum of 400 weeks of coverage from the date of the accident. Review ContentNext Question If the insurer pays an amount less than the amount insured under the policy in the event of a total loss to property, how much of the insured's premium must the insurer return? The amount of premium actually paid and the premium that would have been charged for a policy with an amount of insurance equal to the amount paid by the insurer for the loss. In the event of a total loss to property, if the insurer pays an amount less than the amount insured under the policy, the insurer must return the amount of premium actually paid and the premium that would have been charged for a policy with an amount of insurance equal to the amount paid by the insurer for the loss. Which of the following terms refers to the acts of soliciting insurance, making an insurance contract effective, and dealing with matters arising from that contract? Transacting insurance. Any of the following acts is considered to constitute an act of "transacting insurance" in Georgia: solicitation and inducement to insurance, preliminary insurance negotiations, effectuation of an insurance contract, and transactions of matters subsequent to and arising out of effectuation of an insurance contract. When do certificates of authority expire in Georgia? June 30th of the year following insurance. All certificates of authority expire at midnight on June 30th of the year following insurance. An insured must get advance warning if the premiums will be increased by more than... 15%. Written notice of an increase in premiums that exceeds 15% of the current policy's premium must be delivered or mailed to the insured at least 45 days before the effective date of the change. An agent offers his client free tickets to a sporting event in exchange for the purchase of an insurance policy. The agent is guilty of... Rebating. When producers give or promise anything of value that is not specified in the policy, they are guilty of rebating. A willful violation of an agent's fiduciary responsibility that involved funds exceeding $500 will be considered... A felony.