Arkansas State Laws Quiz With Complete Solution 2025

Arkansas State Laws Quiz With Complete Solution 2025 Which of the following statements describing the fiduciary and contractual relationships between producers, clients, and insurers is correct? A A licensee appointed as an agent by one insurer is considered an agent by all insurers B All funds received by a licensee must be held in a trust, but the licensee may use the funds to help out an insolvent insurer C All funds received by licensee must be held in a trust, and any personal use is considered theft D A licensed agent may not act as a broker and a licensed broker may not act as an agent - answer-C All funds received by licensee must be held in a trust, and any personal use is considered theft The fiduciary duty of the producer specifically refers to the funds that they handle for their clients and insurers, which are held in a trust and may not be diverted for their own use. Agents may act as brokers when dealing with firms with which they have no appointment. The reverse is equally true for brokers. Which of the following statements accurately describe the penalties that may be imposed by the Commissioner? A The Commissioner may revoke the license of an individual who knowingly accepts business from an unlicensed producer BThe Commissioner may order restitution for projected losses to affected persons C The Commissioner may impose a fine of up to $2,500 for violating any provision of the Insurance Code D The Commissioner can suspend an insurance license for up to 24 months - answer-A The Commissioner may revoke the license of an individual who knowingly accepts business from an unlicensed produce If an individual knowingly accepts business from an unlicensed producer, the Commissioner may revoke the license. The Commissioner may not revoke a license if an individual unknowingly accepts business from an unlicensed producer. The Commissioner may suspend a license for up to 36 months, impose a fine of up to $1,000 for each violation of the Insurance Code, and order restitution for actual losses to affected persons.