Exam (elaborations)
PROPERTY AND CASUALTY INSURANCE EXAM – GEORGIA
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PROPERTY AND CASUALTY INSURANCE EXAM – GEORGIA
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PROPERTY AND CASUALTY INSURANCE EXAM –GEORGIA
BPP building coverage - Answers -insures the building at the described location,
outdoor, fixtures, furnitures, items used to service the property, permanently installed
machinery and equipment, and additions under construction, including the materials,
supplies, and equipment.
HO limits of property at other residences - Answers -the larger of $1000 or 10%
Coverage C. Limit does not apply if property is moved because the residence premise is
being repaired or rebuilt.
When property is moved to newly acquired residence, the limit shown on declaration will
apply on a proportional basis to each residence
Dwellings under construction - Answers -The limit of liability for a dwelling under
construction is provisional, and is based on the completed value of the structure. At the
time of loss, the applicable limit is a percentage of the provisional limit, based on the
proportion of actual cash value of the property at the time of loss. Premium is based on
an average amount of insurance during construction.
Water Backup & Sump Pump Endorsement - Answers -Coverage for up to $5,000 in
loss or damage, subject to a $250 deductible, can be provided for an additional
premium with this endorsement.
Automatic Increase in Insurance Endorsement - Answers -is used to provide at the
annual renewal date of the policy, an automatic increase in the Coverage A and B limits
of insurance to help offset inflation
Other insurance - Answers -A provision in an insurance policy that defines how the
policy will respond if there is another valid insurance policy written on the same risk.
Stock Companies - Answers -Owned by the stockholders who provide the capital
necessary to establish and operate the insurance company and who share in any profits
or losses.
Mutual companies - Answers -Owned by the policyowners and issue participating
policies. Policyowners are entitled to dividends, which are a return of excess premium
and are nontaxable.
6 classes of insurance in Georgia - Answers -1. Life, accident, and sickness
2. Property, marine, and transportation
3. Casualty
4. Surety
5. Title
,6. HMOs
How often must the Insurance Commission examine domestic insurers? - Answers -
Once every 5 years.
What are the timelines if a hearing is requested? - Answers -A hearing must be made
within 30 days of the receipt of the request.
A notification of the hearing must be sent at least 15 days in advance.
Within 30 days of the hearing, the Commissioner must release his decision.
What are the penalties after a notice, hearing, and cease and desist order? - Answers -
A fine of up to $10,000 per violation
Suspension/revocation of license
Any other appropriate relief.
Express authority - Answers -the authority of an agent, stated in the document or
agreement creating the agency
Misrepresentation - Answers -Issuing, publishing, or circulation and illustration or sales
materials that is false, misleading, or deceptive as to policy benefits or terms, the
payments of dividends, etc.
False advertising - Answers -advertising that is misleading in some important way,
including the failure to reveal facts about possible results from using the advertised
products
Rebating - Answers -Any inducement offered in the sale of insurance products that is
not specified in the policy. They are illegal in Georgia.
Twisting - Answers -A form of misrepresentation in which an agent persuades an
insured/owner to cancel, lapse, or switch policies, even when it's to the insured's
disadvantage.
Churning - Answers -Replacing insurance policies for the sole purpose of making
commissions. It is illegal to replace existing life or disability policies with new policies if
the producer cannot demonstrate that the replacement will benefit the insured.
Coercion - Answers -Unfair trade practice where an agent uses physical or mental force
with the intense of inducing an applicant to purchase insurance.
Defamation - Answers -Defamation occurs when an oral or written statement is made
that is intended to injure a person engaged in the insurance business. This also applies
to statements that are maliciously critical of the financial condition of any person or a
company.
Controlled business - Answers -Controlled business is any coverage written on a
producer's own life, health or property, and/or that of the producer's immediate family or
,business associates. A licensee is not allowed to collect commissions on controlled
business at rate higher than 25% of the agent' volume per calendar year.
What is a binder - Answers -A temporary insurance contract that goes in effect prior to
the policy issue. No binder shall be valid pass the issuance of the policy beyond 90
days of its effective date, whichever period is shorted.
Georgia FAIR - Answers -The Georgia Fair Access to Insurance Requirement provides
basic property insurance for those who cannot obtain it in the ordinary market.
Georgia Automobile Insurance Plan - Answers -The Georgia Automobile Insurance Plan
makes automobile insurance available for insureds who are unable to purchase
coverage in the voluntary market. When an automobile policy is cancelled or
nonrenewed for a reason other than for nonpayment of premium, the insurer must notify
the insured of their eligibility for coverage through the Georgia Automobile Insurance
Plan. The notice about the Plan must accompany the notice of cancellation or
nonrenewal.
Workman's Compensation - Answers -Covers all business with 3 or more employees
Workman's Compensation Coverage - Answers -Doctors bills
hospital bills
physical therapy
prescriptions
necessary travel expenses
Treatment limited to max of 400 weeks unless injuries are catastrophic.
What are the benefit payout requirements for WC? - Answers -Workers can collect WC
benefits after being out of work for more than 7 days, and the first check will arrive with
21 days of the first missed workday. The compensation is limited to 2/3 of the worker's
average weekly pay up to $575.
Georgia Workers Compensation Assigned Risk Plan - Answers -The Georgia Workers
Compensation Assigned Risk Plan exists to provide required Workers Compensation
coverage for employers who do not qualify for coverage in the voluntary market. Liability
is apportioned among all insurers authorized to write Workers Compensation and
Employers Liability in the state.
How often must an insurer update their rate filings? - Answers -Every 2 years
All insurers must file their rates 45 days before their effective date.
When a rate increases more than 10$ or more within 12 months, the Commissioner will
order and examination.
, What is the Commissioner's term of office? - Answers -4 years
When does an agent have to notify the Commissioner of a change of address? -
Answers -Within 30 days
Implied authority - Answers -Authority that is not expressed or written into the contract,
but which the agent is assumed to have in order to transact the business of insurance
for the principal.
Apparent authority - Answers -The appearance or the assumption of authority based on
the actions, words, or deeds of the principal or because of circumstances the principal
created.
When does an agents license expire? - Answers -Licenses are good to for 2 years and
expire on the last day of the licensee's with month.
What are the CE requirements for an agent? - Answers -24 CE credit hours every 2
years, including 3 credit hours of ethics.
Agents with licensed for 20 years only need 20 CE credit hours, including ethics.
How long must an agent keep records regarding contracts, premiums, etc.? - Answers -
All records must be kept for 5 years after the completion of a transaction or for the term
of the contract, whichever is greater.
How many days are allowed to report a criminal prosecution against a licensee? -
Answers -30 days
What is the total liability of the Georgia Life and Health Insurance Guaranty Association
for any one life? - Answers -$300,000
PAP Section II Part B: Medical Expenses Coverage - Answers --covers all reasonable
medical costs and funeral expenses incurred, by the insured or the insured's family
members within 3 years of an accident
-recommended coverage of $50,000
Cancellation and Nonrenewal of Policies other than PA and PP - Answers -For all
insurance other than that covering a personal automobile or personal property, a notice
of termination, including a notice of cancellation or nonrenewal, a notice of increase in
premiums that exceeds 15% of the current policy's premium unless due to a change in
risk or exposure or a notice of change in any policy provision which limits or restricts
coverage must be delivered or mailed to the insured at least 45 days before the
effective date of such termination or change.
Failure to comply with this requirement entitles the policyholder to purchase a policy for
an additional 30 days beyond the current expiration date (on the same terms and
conditions and with the same premium as the expiring policy). If the policy will incur a
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