Iowa Laws, Rules, and Regulation
Pertinent to Life Only
A banker is ready to close on a customer's loan. The bank is prepared to offer the loan but only
if the customer purchases a life insurance policy from the bank in the amount of the loan. This is
an example of
a. loading
b. defamation
c. twisting
d. coercion - ANS - d. coercion
\A producer in another state wants to become a producer in Iowa. The other state gives the
same privileges to Iowa producers wanting to be licensed in that state as it does its own
producers. Iowa therefore extends the privileges of its producers to the prospective producer of
the other state. What is that called?
a. fair exchange
b. equanimity
c. equal privilege
d. reciprocity - ANS - d. reciprocity
\After a hearing, civil penalties imposed by the commissioner for each unfair method of
competition may NOT exceed
a. $1,500
b. $5,000
c. $500
d. $1,000 - ANS - d. $1,000
\All of the following are true regarding rebates EXCEPT - ANS - rebates are allowed if it's in the
best interest of the client
\All of the following statements are correct regarding credit life insurance EXCEPT - ANS -
benefits are paid to borrowers beneficiary
\An agent offers a client free tickets to a sporting event in exchange for the purchase of an
insurance policy. What is the agent guilty of? - ANS - rebating
\An agent offers his client free tickets to a sporting event in exchange for the purchase policy.
The agent is guilty of
a. coercion
b. twisting
c. controlled business
d. rebating - ANS - d. rebating
, \An insurance company has published a brochure that inaccurately portrays the advantages of a
particular insurance policy. What is this an example of?
a. unfair claims
b. twisting
c. defamation
d. false advertising - ANS - d. false advertising
\Can insurers advertise the existence of the guaranty association during solicitation and sale of
insurance policies? - ANS - No
\Circulating deceptive sales material to the public is what type of unfair trade practice?
a. coercion
b. misrepresentation
c. false advertising
d. defamation - ANS - c. false advertising
\Conversion privilege in group life insurance policies must be exercised within what period of
time after termination of group coverage?
a. 10 days
b. 31 days
c. 90 days
d. 6 months - ANS - b. 31 days
\During a sales presentation a producer intentionally makes a statement which may mislead the
insurance applicant. This describes
a. twisting
b. coercion
c. misrepresentation
d. defamation - ANS - c. misrepresentation
\During replacement of all life insurance, a replacing insurer must do which of the following? -
ANS - obtain a list of all life insurance policies that will be replaced
\For what reason can a temporary license be issued? - ANS - for continuation of business in
case the licensed producer dies or become disabled
\How must a replacing producer to an applicant wishing to replace existing life insurance? - ANS
- the producer must provide the applicant with a notice regarding replacement
\If a person is suspected of violating insurance laws, what can the commissioner issue that
would order the person to stop violating the violations?
a. limitation of power statement
b. cease and desist order
c. stop-action order
d. suspension of authority - ANS - b. cease and desist order
\If a producer makes maliciously critical statements about another insurer, what is this illegal
practice called? - ANS - defamation
Pertinent to Life Only
A banker is ready to close on a customer's loan. The bank is prepared to offer the loan but only
if the customer purchases a life insurance policy from the bank in the amount of the loan. This is
an example of
a. loading
b. defamation
c. twisting
d. coercion - ANS - d. coercion
\A producer in another state wants to become a producer in Iowa. The other state gives the
same privileges to Iowa producers wanting to be licensed in that state as it does its own
producers. Iowa therefore extends the privileges of its producers to the prospective producer of
the other state. What is that called?
a. fair exchange
b. equanimity
c. equal privilege
d. reciprocity - ANS - d. reciprocity
\After a hearing, civil penalties imposed by the commissioner for each unfair method of
competition may NOT exceed
a. $1,500
b. $5,000
c. $500
d. $1,000 - ANS - d. $1,000
\All of the following are true regarding rebates EXCEPT - ANS - rebates are allowed if it's in the
best interest of the client
\All of the following statements are correct regarding credit life insurance EXCEPT - ANS -
benefits are paid to borrowers beneficiary
\An agent offers a client free tickets to a sporting event in exchange for the purchase of an
insurance policy. What is the agent guilty of? - ANS - rebating
\An agent offers his client free tickets to a sporting event in exchange for the purchase policy.
The agent is guilty of
a. coercion
b. twisting
c. controlled business
d. rebating - ANS - d. rebating
, \An insurance company has published a brochure that inaccurately portrays the advantages of a
particular insurance policy. What is this an example of?
a. unfair claims
b. twisting
c. defamation
d. false advertising - ANS - d. false advertising
\Can insurers advertise the existence of the guaranty association during solicitation and sale of
insurance policies? - ANS - No
\Circulating deceptive sales material to the public is what type of unfair trade practice?
a. coercion
b. misrepresentation
c. false advertising
d. defamation - ANS - c. false advertising
\Conversion privilege in group life insurance policies must be exercised within what period of
time after termination of group coverage?
a. 10 days
b. 31 days
c. 90 days
d. 6 months - ANS - b. 31 days
\During a sales presentation a producer intentionally makes a statement which may mislead the
insurance applicant. This describes
a. twisting
b. coercion
c. misrepresentation
d. defamation - ANS - c. misrepresentation
\During replacement of all life insurance, a replacing insurer must do which of the following? -
ANS - obtain a list of all life insurance policies that will be replaced
\For what reason can a temporary license be issued? - ANS - for continuation of business in
case the licensed producer dies or become disabled
\How must a replacing producer to an applicant wishing to replace existing life insurance? - ANS
- the producer must provide the applicant with a notice regarding replacement
\If a person is suspected of violating insurance laws, what can the commissioner issue that
would order the person to stop violating the violations?
a. limitation of power statement
b. cease and desist order
c. stop-action order
d. suspension of authority - ANS - b. cease and desist order
\If a producer makes maliciously critical statements about another insurer, what is this illegal
practice called? - ANS - defamation
