LOUISIANA LAW EVALUATION TEST QUESTIONS AND
SOLUTIONS GRADED A+
✔✔What must nonresident producers hold? - ✔✔Home-state license
✔✔What requires producer disclosure to the insurer? - ✔✔Replacement of policies
✔✔Who can receive commissions? - ✔✔Licensed producers only
✔✔What happens to a producer acting without a license? - ✔✔Subject to administrative
action
✔✔When may a license be suspended without a hearing? - ✔✔For nonpayment of fines
✔✔How long must producer records be kept? - ✔✔At least 3 years
✔✔What does misrepresentation involve? - ✔✔False statements about a policy
✔✔What is twisting? - ✔✔Replacing a policy with misleading info
✔✔What is rebating? - ✔✔Offering inducements not in the policy
✔✔Which practice is illegal in Louisiana? - ✔✔Rebating
✔✔What does defamation involve? - ✔✔False statements about competitors
✔✔What does insurance fraud include? - ✔✔Filing false claims
✔✔What is considered unfair discrimination? - ✔✔Charging different rates without
actuarial basis
✔✔In whose best interest must a producer act? - ✔✔Client
✔✔What practice involves pressuring clients to buy insurance? - ✔✔Coercion
✔✔What does churning refer to? - ✔✔Replacing policies for commission
✔✔What penalties may result from unfair trade practices? - ✔✔License suspension
✔✔Which practice is allowed? - ✔✔Accurate policy comparison
✔✔To whom must fraudulent activities be reported? - ✔✔Commissioner
SOLUTIONS GRADED A+
✔✔What must nonresident producers hold? - ✔✔Home-state license
✔✔What requires producer disclosure to the insurer? - ✔✔Replacement of policies
✔✔Who can receive commissions? - ✔✔Licensed producers only
✔✔What happens to a producer acting without a license? - ✔✔Subject to administrative
action
✔✔When may a license be suspended without a hearing? - ✔✔For nonpayment of fines
✔✔How long must producer records be kept? - ✔✔At least 3 years
✔✔What does misrepresentation involve? - ✔✔False statements about a policy
✔✔What is twisting? - ✔✔Replacing a policy with misleading info
✔✔What is rebating? - ✔✔Offering inducements not in the policy
✔✔Which practice is illegal in Louisiana? - ✔✔Rebating
✔✔What does defamation involve? - ✔✔False statements about competitors
✔✔What does insurance fraud include? - ✔✔Filing false claims
✔✔What is considered unfair discrimination? - ✔✔Charging different rates without
actuarial basis
✔✔In whose best interest must a producer act? - ✔✔Client
✔✔What practice involves pressuring clients to buy insurance? - ✔✔Coercion
✔✔What does churning refer to? - ✔✔Replacing policies for commission
✔✔What penalties may result from unfair trade practices? - ✔✔License suspension
✔✔Which practice is allowed? - ✔✔Accurate policy comparison
✔✔To whom must fraudulent activities be reported? - ✔✔Commissioner
