LOMA 311 MODULE 3 EXAM
Preemption - ANSWERS-"a legal doctrine that holds that some
matters are of such national importance that the federal laws
override—or preempt—any conflicting state laws. The states cannot
pass laws that are inconsistent with such federal laws."
interstate commerce vs intrastate commerce - ANSWERS-interstate=
commerce across state lines
intrastate= commerce WITHIN a state
McCarran-Ferguson Act (1945) - ANSWERS-gives the states primary
authority to regulate insurance as long as Congress finds such state
regulation to be adequate. According to the McCarran-Ferguson Act,
the regulation of insurance by the states is in the public interest.
+++ in the US, insurance companies are subject to DUAL regulation
+++ the Federal Government had the power to regulate interstate
commerce.
Legislative, Executive, Judicial - ANSWERS-Legislative.
The state legislature enacts and modifies
statutes to regulate the activities of insurers. These statutes are found
in the state insurance code, which is updated periodically.
STATUTORY
,Executive.
The state insurance department adopts regulations that fill in the
details of insurance statutes. The insurance
department also enforces statutes and regulations and oversees the
operations of all insurers that operate in the state. The state attorney
general writes opinions that interpret state laws or regulations. The
attorney general writes opinions upon the request of legislators, state
officials, private persons, or businesses. Although attorney general
opinions do not have the same force of law as statutes, regulations, or
court decisions, state officials usually follow these opinions.
ADMINISTRATIVE
Judicial.
The state courts have authority to interpret an insurance law's
meaning when the application of the law to a specific situation is not
clear.
CASE LAW
Solvency vs. market Conduct laws - ANSWERS-Solvency laws are
enacted
to make sure that insurers are financially able to meet their debts and
pay policy benefits when they come due. Solvency laws affect an
insurer's
capitalization, policy design, and policy reserves.
Market conduct laws are
, enacted to make sure that insurers conduct business fairly and
ethically. Market conduct laws set mandated benefits and regulate
most of the nonfinancial operations of insurers, such as management,
marketing and advertising, sales, underwriting, policyowner service,
complaint handling, agent licensing,
and claims.
Solvency laws apply to reserves, assets, investments, capital and
surplus
financial condition exam - ANSWERS-a formal investigation that is
designed to IDENTIFY and MONITOR THREATS to an insurer's
solvency. These examinations may be carried out by one or more state
insurance departments. Statutes typically require an examination of
each insurer within a specified period of time. State insurance
departments
also have authority to conduct more frequent examinations if needed.
States conduct two types of financial condition examinations.
1. A full-scope examination reports on an insurer's financial position
taken as a whole.
2. A limited-scope examination focuses
on one or more specific areas of an insurer's finances, such as its
reserves or its ability to pay claims.
a state does NOT undergo the FCE each year
, Market Conduct Examination - ANSWERS-a formal investigation of
an insurer's nonfinancial operations.
A market conduct examination determines if the insurer's operations
comply with applicable laws and regulations. Like financial condition
examinations, a market conduct examination may be carried out by
one or more state insurance
departments.
Licensing Requirements - ANSWERS-state insurance laws require
insurers to
obtain a license in each jurisdiction where they do business.
Similarly, state insurance laws require individuals who market and
sell insurance to obtain a license in each jurisdiction where they do
business.
Annual Statement - ANSWERS-a comprehensive financial report that
insurers must file with the NAIC and all the state ins depts they are
licensed in.
STORED in a financial database
Must file by March 1st
Most state require shorter versions to be filed quarterly.
Preemption - ANSWERS-"a legal doctrine that holds that some
matters are of such national importance that the federal laws
override—or preempt—any conflicting state laws. The states cannot
pass laws that are inconsistent with such federal laws."
interstate commerce vs intrastate commerce - ANSWERS-interstate=
commerce across state lines
intrastate= commerce WITHIN a state
McCarran-Ferguson Act (1945) - ANSWERS-gives the states primary
authority to regulate insurance as long as Congress finds such state
regulation to be adequate. According to the McCarran-Ferguson Act,
the regulation of insurance by the states is in the public interest.
+++ in the US, insurance companies are subject to DUAL regulation
+++ the Federal Government had the power to regulate interstate
commerce.
Legislative, Executive, Judicial - ANSWERS-Legislative.
The state legislature enacts and modifies
statutes to regulate the activities of insurers. These statutes are found
in the state insurance code, which is updated periodically.
STATUTORY
,Executive.
The state insurance department adopts regulations that fill in the
details of insurance statutes. The insurance
department also enforces statutes and regulations and oversees the
operations of all insurers that operate in the state. The state attorney
general writes opinions that interpret state laws or regulations. The
attorney general writes opinions upon the request of legislators, state
officials, private persons, or businesses. Although attorney general
opinions do not have the same force of law as statutes, regulations, or
court decisions, state officials usually follow these opinions.
ADMINISTRATIVE
Judicial.
The state courts have authority to interpret an insurance law's
meaning when the application of the law to a specific situation is not
clear.
CASE LAW
Solvency vs. market Conduct laws - ANSWERS-Solvency laws are
enacted
to make sure that insurers are financially able to meet their debts and
pay policy benefits when they come due. Solvency laws affect an
insurer's
capitalization, policy design, and policy reserves.
Market conduct laws are
, enacted to make sure that insurers conduct business fairly and
ethically. Market conduct laws set mandated benefits and regulate
most of the nonfinancial operations of insurers, such as management,
marketing and advertising, sales, underwriting, policyowner service,
complaint handling, agent licensing,
and claims.
Solvency laws apply to reserves, assets, investments, capital and
surplus
financial condition exam - ANSWERS-a formal investigation that is
designed to IDENTIFY and MONITOR THREATS to an insurer's
solvency. These examinations may be carried out by one or more state
insurance departments. Statutes typically require an examination of
each insurer within a specified period of time. State insurance
departments
also have authority to conduct more frequent examinations if needed.
States conduct two types of financial condition examinations.
1. A full-scope examination reports on an insurer's financial position
taken as a whole.
2. A limited-scope examination focuses
on one or more specific areas of an insurer's finances, such as its
reserves or its ability to pay claims.
a state does NOT undergo the FCE each year
, Market Conduct Examination - ANSWERS-a formal investigation of
an insurer's nonfinancial operations.
A market conduct examination determines if the insurer's operations
comply with applicable laws and regulations. Like financial condition
examinations, a market conduct examination may be carried out by
one or more state insurance
departments.
Licensing Requirements - ANSWERS-state insurance laws require
insurers to
obtain a license in each jurisdiction where they do business.
Similarly, state insurance laws require individuals who market and
sell insurance to obtain a license in each jurisdiction where they do
business.
Annual Statement - ANSWERS-a comprehensive financial report that
insurers must file with the NAIC and all the state ins depts they are
licensed in.
STORED in a financial database
Must file by March 1st
Most state require shorter versions to be filed quarterly.
