Montana State Life Insurance Exam
Questions and Answers
How often does the Commissioner perform examination of an insurer? - answer-
Once every 5 years
After the examination is completed, when does the examiner's report must be filed
with the Commissioner? - answer-Within 60 days
What is the window for a rebuttal? - answer-30 days
If an investigatory hearing is needed, when does it need to be held? - answer-No
less than 20 days.
How long must the producers keep records of each insurance transaction? - answer-
3 years
What needs to be on the Commissioner orders and notices to be effective? - answer-
1. The effective date, intent or purposes.
2. The ground on which the order is based.
3. The Montana Insruance Code provisions relating to the action taken or proposed
to be taken; failure to designate a particular provision does not prohibit the
Commissioner's right to rely on a particular provision.
What is the fine for failure to cooperate with the Commissioner, give full and truthful
information, answer in writing to any material inquiry, or appear for testimony
relationve to an examination, investigation, or hearing? - answer-$25,000. Cannot be
more than $5,000 per violation
Whenever the Commissioner believes a person has engaged in or is about to
engage in an act/practice constituting a violation of the Insruance Code, what do
they issue? - answer-Cease and Desist Orders
How much time does the respondent have to request for a hearing after a cease and
desist order is received? - answer-15 days (written)
What is the penalty for violating a cease and desist order? - answer-$1,000. Each
day of violation constitutes a separate violation
All hearings must be conducted pursuant to which act? - answer-the Montana
Administrative Procedure Act.
When does a rehearing must be held? - answer-Within 30 days
Transacting an insurance includes 4 what steps? - answer-1. Solicitation
2. Negotiations
3. Sale or effectuation of an insurance contract
,4. Transaction of matters subsequent to the issue of an insurance policy
What must an authorized insurer have? - answer-Certificate of Authority
Definition of a business entity does not include what? - answer-an individual
What is an adjuster? - answer-An adjuster is a person who, on behalf of the insurer,
investigates and negotiates the settlement of claims arising under insurance
contracts as an employee of the insurer or as an independent contractor.
Adjuster does not include who? - answer-1. A licensed attorney
2. A salaried employee of an insurer or of a managing law in this state
3. A licensed insurance producer who adjusts or assists in adjustment of losses
arising under policies issued by the insurer.
4. A third-party adinistrator who adjusts or assists in adjustment of losses arising
under policies issued by the insurer
5. A claim examiner
What conditions must be met to be a nonresident insurance producer in Montana? -
answer-1/ Is currently licesned as a resident is in good standing in the person's
home state.
2/ Has submitted the proper request and has paid the required fees
3/ Has submitted the licensing application that the person submitted to the person's
home state or a completed application in a form approved by the Commissioner
4/ Is from a home state that awards nonresident insurance producer licenses to
residents of this state on the same basis.
What cannot the Consultant do? - answer-An insurance consultant may not
recommed or encourage the purchase of insurance, annnuities, or securities from an
authorized insurer in which the person or any member of the person's immediate
family holds an executive position or holds a substantial interest.
How long does a copy of every memorandum or contract be retained ? - answer-3
years
What is an administrator? - answer-An administrator is a person who collects and
charges premiums from residents of this state in connection with life, disability,
property, or casualty insurance or annuities or who adjusts or settles claims on these
lines.
A person may not act as an administrator without what item? - answer-A written
agreement between the person and the insurer
How long does the written agreement between an administrator and an insurer must
be kept? - answer-5 years
What certificate must an administrator hold? - answer-Certificate of Registration
What's the penalty for a person acting as an administrator without the Certificate of
Registration? - answer-$500-$1,500
, How many credit hours must a licensee for a limited lines credit insurance or surety
bail bonds must complete to fulfill continuing education? - answer-5 hours for every
24 months.
What will happen if continuing education requirements are not met? - answer-
License will lapse
How long does a temporary license without requiring examination last? - answer-90
days
Can the Commissioner issue more than one temporary license, to or with respect to
the same individual within any 12 month period? - answer-no
If a person's license is revoked, how long do they must wait before they can reapply
for the license? - answer-1 year after the revocation and all license qualifications are
met. However, the Commissioner may refuse to issue a license for up to 5 years
When must the appointing insurer file the appointment to the Commissioner? -
answer-Within 15 days of the appointment's effective date.
When does a disapproved appointment become voided? - answer-On the date the
department provides notification to the insurer.
Define "False Advertisement" - answer-The act of publishing or disseminating in any
fashion, or through any media, any untrue, deceptive, or misleading statement about
the business of insurance or, with respect to any person, in the conduct of such
person's insurance business.
Define "rebating" - answer-unlawful act of offerring rebate of premiums payable, any
special favor in dividends or other benefits, or any valuable consideration or
inducement not specified in the policy.
Define "twisting" - answer-The act of making or issuing any written or oral statement
misinterpreting or making incomplete comparisons as to the terms, conditions, or
benefits, contained in any policy for the purpose of inducing/tending to induce the
policyholder to lapse, forfeit, surrender, retain, exchange, or convert any insurance
policy.
Define "defamation" - answer-Making any false or maliciously critical statements
regarding the financial condition of any person, with the intent to injure such person.
When must the insurer/producer provide a notice of information practices to the
applicants? - answer-1. With a written application, disclosure notice must be given at
the time of delivery of the policy or at the time when the collection of personal
information is taken from a source other than the applicant.
2. In the case of a renewal policy, at least ANNUALLY.
3. In the case of policy reinstatement or change in insurance benefits, a notice must
be given no later than at the time of the reinstatement or a change in benefits.
Questions and Answers
How often does the Commissioner perform examination of an insurer? - answer-
Once every 5 years
After the examination is completed, when does the examiner's report must be filed
with the Commissioner? - answer-Within 60 days
What is the window for a rebuttal? - answer-30 days
If an investigatory hearing is needed, when does it need to be held? - answer-No
less than 20 days.
How long must the producers keep records of each insurance transaction? - answer-
3 years
What needs to be on the Commissioner orders and notices to be effective? - answer-
1. The effective date, intent or purposes.
2. The ground on which the order is based.
3. The Montana Insruance Code provisions relating to the action taken or proposed
to be taken; failure to designate a particular provision does not prohibit the
Commissioner's right to rely on a particular provision.
What is the fine for failure to cooperate with the Commissioner, give full and truthful
information, answer in writing to any material inquiry, or appear for testimony
relationve to an examination, investigation, or hearing? - answer-$25,000. Cannot be
more than $5,000 per violation
Whenever the Commissioner believes a person has engaged in or is about to
engage in an act/practice constituting a violation of the Insruance Code, what do
they issue? - answer-Cease and Desist Orders
How much time does the respondent have to request for a hearing after a cease and
desist order is received? - answer-15 days (written)
What is the penalty for violating a cease and desist order? - answer-$1,000. Each
day of violation constitutes a separate violation
All hearings must be conducted pursuant to which act? - answer-the Montana
Administrative Procedure Act.
When does a rehearing must be held? - answer-Within 30 days
Transacting an insurance includes 4 what steps? - answer-1. Solicitation
2. Negotiations
3. Sale or effectuation of an insurance contract
,4. Transaction of matters subsequent to the issue of an insurance policy
What must an authorized insurer have? - answer-Certificate of Authority
Definition of a business entity does not include what? - answer-an individual
What is an adjuster? - answer-An adjuster is a person who, on behalf of the insurer,
investigates and negotiates the settlement of claims arising under insurance
contracts as an employee of the insurer or as an independent contractor.
Adjuster does not include who? - answer-1. A licensed attorney
2. A salaried employee of an insurer or of a managing law in this state
3. A licensed insurance producer who adjusts or assists in adjustment of losses
arising under policies issued by the insurer.
4. A third-party adinistrator who adjusts or assists in adjustment of losses arising
under policies issued by the insurer
5. A claim examiner
What conditions must be met to be a nonresident insurance producer in Montana? -
answer-1/ Is currently licesned as a resident is in good standing in the person's
home state.
2/ Has submitted the proper request and has paid the required fees
3/ Has submitted the licensing application that the person submitted to the person's
home state or a completed application in a form approved by the Commissioner
4/ Is from a home state that awards nonresident insurance producer licenses to
residents of this state on the same basis.
What cannot the Consultant do? - answer-An insurance consultant may not
recommed or encourage the purchase of insurance, annnuities, or securities from an
authorized insurer in which the person or any member of the person's immediate
family holds an executive position or holds a substantial interest.
How long does a copy of every memorandum or contract be retained ? - answer-3
years
What is an administrator? - answer-An administrator is a person who collects and
charges premiums from residents of this state in connection with life, disability,
property, or casualty insurance or annuities or who adjusts or settles claims on these
lines.
A person may not act as an administrator without what item? - answer-A written
agreement between the person and the insurer
How long does the written agreement between an administrator and an insurer must
be kept? - answer-5 years
What certificate must an administrator hold? - answer-Certificate of Registration
What's the penalty for a person acting as an administrator without the Certificate of
Registration? - answer-$500-$1,500
, How many credit hours must a licensee for a limited lines credit insurance or surety
bail bonds must complete to fulfill continuing education? - answer-5 hours for every
24 months.
What will happen if continuing education requirements are not met? - answer-
License will lapse
How long does a temporary license without requiring examination last? - answer-90
days
Can the Commissioner issue more than one temporary license, to or with respect to
the same individual within any 12 month period? - answer-no
If a person's license is revoked, how long do they must wait before they can reapply
for the license? - answer-1 year after the revocation and all license qualifications are
met. However, the Commissioner may refuse to issue a license for up to 5 years
When must the appointing insurer file the appointment to the Commissioner? -
answer-Within 15 days of the appointment's effective date.
When does a disapproved appointment become voided? - answer-On the date the
department provides notification to the insurer.
Define "False Advertisement" - answer-The act of publishing or disseminating in any
fashion, or through any media, any untrue, deceptive, or misleading statement about
the business of insurance or, with respect to any person, in the conduct of such
person's insurance business.
Define "rebating" - answer-unlawful act of offerring rebate of premiums payable, any
special favor in dividends or other benefits, or any valuable consideration or
inducement not specified in the policy.
Define "twisting" - answer-The act of making or issuing any written or oral statement
misinterpreting or making incomplete comparisons as to the terms, conditions, or
benefits, contained in any policy for the purpose of inducing/tending to induce the
policyholder to lapse, forfeit, surrender, retain, exchange, or convert any insurance
policy.
Define "defamation" - answer-Making any false or maliciously critical statements
regarding the financial condition of any person, with the intent to injure such person.
When must the insurer/producer provide a notice of information practices to the
applicants? - answer-1. With a written application, disclosure notice must be given at
the time of delivery of the policy or at the time when the collection of personal
information is taken from a source other than the applicant.
2. In the case of a renewal policy, at least ANNUALLY.
3. In the case of policy reinstatement or change in insurance benefits, a notice must
be given no later than at the time of the reinstatement or a change in benefits.
