Exam (elaborations)
Primerica Life Insurance Vocabulary Questions with correct Answers
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Primerica Life Insurance Vocabulary
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Primerica Life Insurance Vocabularypretext interviews - answer An interview when a person attempts to obtain information
from another person...and they pretend to be someone else.
NAIC - answer National Association of Insurance Commissioners - an association of
state commissioners that influences the industry's self-regulation
controlled business - answer Business written on the producer's own life or interests.
market conduct - answer the non-financial regulatory activities of an insurance
department. You conduct insurance fairly and responsibly. (Non-financial regulatory
activities of an insurance dept. fall under the board heading of market conduct)
Can producers act as agents representing insurance companies and brokers
representing individuals? - answer Yes (MN doesn't acknowledge brokers)
Applicants for insurance must be given advance notice including what? (concerning
information collecting) - answer The kind of information collected
The reason it's being collected
How the information will be used
The sources of information
The persons with access to personal information
(NOT the persons who are collecting information)
consumer - answerAn individual about whom a financial institution collects information -
became this way because of the Gramm Leach Bliley Act.
customer - answerAn individual with whom a financial institution has an ongoing
relationship - became this way because of the Gramm Leach Bliley Act.
The Commissioner of Insurance has what powers? - answerConducting investigations
and examinations
Making reasonable rules and regulations
Approving insurance policy forms sold within the state
(NOT promulgating (put a law into effect by official proclamation) insurance law)
Someone licensed as an insurance producer in another state who moves to this state
has how many days after establishing legal residence to become a resident licensee
without taking prelicensing education or an exam? - answer90 days
,What are parts of a legal insurance contract? (NOT life & health) - answerAgreement
(offer & acceptance)
Consideration
Competent parties
Legal purpose
Parts of a life & health contract: - answerPolicy face (title page)
Insuring clause
Conditions
Exclusions
notice of the scope - answerWhat the commissioner must provide to the
examinee...once it's been given, the insurer/producer must give free access to
everything.
reciprocal - answerMembers of an unincorporated group insure each other and share
the losses with each other. Is managed by an attorney-in-fact (POA)
Who doesn't have to be registered? - answerSomeone who doesn't receive
commissions.
If you want to reinstate a policy, might the insurer require a reinstatement application
and proof of insurability? - answerYes
MCHA won't cover: - answerPreexisting conditions during the first 6 months of coverage
if the person was diagnosed or treated for the condition during the 90 days immediately
preceding the date the app. was received. (Medicare & LTC is opposite and must cover
this.)
Can LTC premiums be deducted for tax purposes? - answerYes
LTC incontestability periods - answerpolicies new within 6 months: insurer can rescind
for lies on app.
policies between 6 mo - 2 years: insurer can rescind for lies on the app. if they're related
to the benefits sought
policies over 2 years: can't do anything except if insured lied about their health on app.
Are qualified LTC policies guaranteed renewable? - answerYes - premiums may be
increased (individual ones are noncancelable - premiums cannot be increased)
When selling health plans to small employers in MN, a health carrier can: -
answerexclude an eligible employee's pre-existing condition up to 12 months from the
enrollment date
Is misstatement of age provision a required provision of an accident and health policy? -
answerno
,McCarran-Ferguson Act - answerStates (not the fed. gov.) are responsible for regulating
insurance
What oversees the insurance industry? - answerThe Dept of Commerce (they're the
regulatory authority)
Who heads up the Dept of Commerce? - answerThe Commissioner of Commerce
Who appoints the Commissioner of Commerce? - answerThe governor - he's NOT
elected
What does the Commissioner have power/not have power to do? - answerENFORCE
laws & establish rules & procedures...he cannot put you in jail.
Guilty/innocent policy of Dept. of Commerce - answeryou're GUILTY until proven
INNOCENT
How much is the fine per day set by the Dept. of Commerce? - answer$10,000/day
Can the commissioner publish info collected in investigations & hearings? - answerYep
What must an insurance company obtain to do business? - answerA certificate of
authority - this makes them an admitted carrier
What must an agent obtain to be able to solicit business? - answerA company
appointment (aka contract)
An example of a surplus line carrier - answerLloyd's of London
Are surplus lines carriers admitted or non? Can they sell insurance in MN without a cert
of authority? - answerNon-admitted; they can sell insurance in MN without a cert. of
auth.
Resident producer - answerYou can only hold 1 resident producer license
If you live & work here, your res. prod. lic. will be in MN.
If you live here, but office is in WI, you are a MN producer
If you live in WI, but office is in MN, you are MN producer
Non-resident producer - answerYou can hold 49 of these
There is a fee, but no test for each
MGA - answerManaging General Agent - They hire producers, supervise a territory,
manage producer activities, and must be licensed.
Temporary License - answer180 days (NOT 6 mo)
, Issued to surviving spouse or mom, dad, sister, bro, son, daughter of deceased agent or
one going into active duty
(Also to court-appointed rep)
With whom do you complete your license application? - answerSircon
How much is the license fee per line? - answer$50 (prop & cas are each lines so $100
total for them) (PLUS $35 technology fee)
You have to apply for a permanent insurance license within how long after passing the
exam? - answer3 years
What is required to sell variable products? - answerSecurities license AND insurance
license
For how long is your ins. lic. good? - answer2 years
An AGENCY license renews when? - answer10/31 every 2 years
PRODUCER's license renews when? - answerLast day of the producer's birth month
(used to be 10/31)
How much continuing education is required during each licensed period? - answer24
hours (HALF must be offered by something other than your company)
How many hours of CD must be ethics? - answer3 hours
Can you carry over credits from one license period to another? - answerNo
Notify commissioner in writing within how long of a name or address change? -
answer10 days
Must notify commissioner in writing within how long of a final disposition being decided
upon concerning administrative action against you - answer30 days
Must notify commissioner in writing within how many days of your initial pre-trial hearing
date? - answer30 days
Must notify commissioner in writing within how many days of a criminal conviction? -
answer10 days
Details about "assumed names" - answerCANNOT conduct business under an
assumed name until receiving prior approval from Commissioner. The name must be
filed with the Sec of State. (Ex - HD Insurance Services)
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