New York State Insurance Regulations
UPDATED ACTUAL Exam Questions and
CORRECT Answers
Insurance regulations - CORRECT ANSWER Takes place at the state level
Disclosure Authorization - CORRECT ANSWER Is the responsibility of a producer (Agent)
to explain to an applicant the various sources from which the insurer (Company) will obtain
information regarding the applicants insurability.
Consumer reports - CORRECT ANSWER Written, oral and other forms of communication
regarding a consumers credit, character, reputation, or habits and used or collected to determine
whether a consumer is eligible for credit, insurance, employment, or other purposes.
Fraud and False Statements - CORRECT ANSWER Interstate transaction is subject to Fines
and imprisonment for up to 10 years.
Civil penalties - CORRECT ANSWER Up to $5000 can be imposed in addition to any
criminal liability
Section 1033(Code) - CORRECT ANSWER Describes the criminal activity under the fraud
statute. Willfully and with intention to make false material statements.
Section 1034 - CORRECT ANSWER The penalties for violations under section 1033 will be
greater of $50,000 or the amount of compensation the person received for the act and
imprisonment up to 15 years.
NAIC - CORRECT ANSWER Organization that has done the most to standardize law
between states.
Exclusions of the Superintendent - CORRECT ANSWER -Cannot put someone in jail.
, -Cannot put someone's license on probation.
-Does NOT write insurance laws
Superintendent - CORRECT ANSWER Is appointed by the governor to a 4-year term
Superintendent - CORRECT ANSWER Enforces state insurance laws and regulations
Superintendent - CORRECT ANSWER Acts as judge during the investigation process.
Pro-Rata - CORRECT ANSWER If the company cancels the policy, it must return 100% of
unearned premium
Short-Rata - CORRECT ANSWER If the policyholder canceled the policy, company returns
100% of unearned premiums minus an acquisition fee.
Reinsurance Reserves - CORRECT ANSWER Guarantees the company has enough money to
operate.
Notice of hearing - CORRECT ANSWER An individual or company being charged with
unfair methods of competition or deceptive practices must be given: At least 10 days after the
date of notice has been sent (Certified Mail)
-Most respond within 15 days of receiving notice.
Unfair marketing practices - CORRECT ANSWER Minimum $500 each/$2500 in aggregate
(All offenses) OR Suspension of license. Agent must pay fine within 20 days.
Aiding an authorized insurance company - CORRECT ANSWER $500 for first offense and
$500 for each month the agent continues to do it OR suspension of license.
UPDATED ACTUAL Exam Questions and
CORRECT Answers
Insurance regulations - CORRECT ANSWER Takes place at the state level
Disclosure Authorization - CORRECT ANSWER Is the responsibility of a producer (Agent)
to explain to an applicant the various sources from which the insurer (Company) will obtain
information regarding the applicants insurability.
Consumer reports - CORRECT ANSWER Written, oral and other forms of communication
regarding a consumers credit, character, reputation, or habits and used or collected to determine
whether a consumer is eligible for credit, insurance, employment, or other purposes.
Fraud and False Statements - CORRECT ANSWER Interstate transaction is subject to Fines
and imprisonment for up to 10 years.
Civil penalties - CORRECT ANSWER Up to $5000 can be imposed in addition to any
criminal liability
Section 1033(Code) - CORRECT ANSWER Describes the criminal activity under the fraud
statute. Willfully and with intention to make false material statements.
Section 1034 - CORRECT ANSWER The penalties for violations under section 1033 will be
greater of $50,000 or the amount of compensation the person received for the act and
imprisonment up to 15 years.
NAIC - CORRECT ANSWER Organization that has done the most to standardize law
between states.
Exclusions of the Superintendent - CORRECT ANSWER -Cannot put someone in jail.
, -Cannot put someone's license on probation.
-Does NOT write insurance laws
Superintendent - CORRECT ANSWER Is appointed by the governor to a 4-year term
Superintendent - CORRECT ANSWER Enforces state insurance laws and regulations
Superintendent - CORRECT ANSWER Acts as judge during the investigation process.
Pro-Rata - CORRECT ANSWER If the company cancels the policy, it must return 100% of
unearned premium
Short-Rata - CORRECT ANSWER If the policyholder canceled the policy, company returns
100% of unearned premiums minus an acquisition fee.
Reinsurance Reserves - CORRECT ANSWER Guarantees the company has enough money to
operate.
Notice of hearing - CORRECT ANSWER An individual or company being charged with
unfair methods of competition or deceptive practices must be given: At least 10 days after the
date of notice has been sent (Certified Mail)
-Most respond within 15 days of receiving notice.
Unfair marketing practices - CORRECT ANSWER Minimum $500 each/$2500 in aggregate
(All offenses) OR Suspension of license. Agent must pay fine within 20 days.
Aiding an authorized insurance company - CORRECT ANSWER $500 for first offense and
$500 for each month the agent continues to do it OR suspension of license.
