State Laws & Regulations- GA P&C Exam Prep
The Commissioner of Insurance is elected for a _____ year term. Correct Answer: 4
The Commissioner has the authority to... Correct Answer: • Make rules and regulations after
giving notice to the public;
• Organize the DOI and assign duties to staff members;
• Issue orders (cease and desist orders) to agents or Insurers; and
• Regulate anything involving "transacting insurance."
"Transacting insurance" includes Correct Answer: • Solicitation and inducement;
• Preliminary negotiations;
• Effectuation of a contract of insurance; and
• Transaction of matters subsequent to effectuation of the contract and arising out of it.
Any cease and desist order from the Commissioner must..... Correct Answer: • Be written and
signed;
• State its effective date and purpose;
• Be delivered to the person to be ordered by mailing it to the person's principal place of business
or last address of record in the Commissioner's office.
At any time, the Commissioner may examine the records of: Correct Answer: • Any Insurer
authorized to do business in Georgia;
• Any licensed insurance agent, broker, counselor, or adjuster; and
• Any person transacting the business of insurance.
The Commissioner is required to examine who and how often? Correct Answer: • Domestic
Insurers at least once every 3 years; and
• Rating organizations at least once each 5 years.
What must the person being examined at the direction of the Commissioner pay? Correct
Answer: the Insurer must pay all the actual expenses of the examination beyond the cost of
regular Department employees.
With respect to an examination, investigation, or hearing, the Commissioner may...... Correct
Answer: take depositions, subpoena witnesses, administer oaths or affirmations, examine any
individual under oath, and compel the production of records, books, papers, and other
documents.
How must Subpoenas be served? What if the individual fails to obey the subpoena? Correct
Answer: In the same manner as if issued by a superior court. If any individual fails to obey a
subpoena, the Commissioner may request that the superior court of the county (in which the
proceeding is pending) issue an order requiring such individual to comply with the subpoena.
,The Commissioner may hold hearings for any purpose deemed necessary. But when MUST they
hold hearings? Correct Answer: The Commissioner must hold a hearing upon the written
demand of any person aggrieved by the Commissioner's act, threatened act, or failure to act.
What are the requirements for the hearing demanded by the aggrieved individual. Correct
Answer: • Must be held within 30 days of request;
• May be held at any place designated by the Commissioner;
• Must be open to the public;
• Requires that at least 10 days advance notice be given to all affected persons;
• Must allow the affected persons to testify, present evidence and witnesses, be represented by
counsel, and to subpoena witnesses and other evidence.
Who must the Commissioner inform when any criminal violation of insurance laws may have
occurred? How may the commissioner enforce any of their order? Correct Answer: must inform
the prosecuting attorney in whose circuit or jurisdiction any criminal violation of the insurance
laws may have occurred.
The Commissioner may bring legal action in the appropriate superior court to enforce any order
of the Commissioner.
If an Insurer, agent, broker, counselor, or adjuster has violated a statute, regulation, or order, the
Commissioner may: Correct Answer: • Place the person on probation for up to 1 year for each
violation;
• Suspend or revoke the person's license;
• Issue a monetary penalty of up to $1,000 for each unintentional violation; and
• Issue a monetary penalty of up to $5,000 for each intentional (knew or should have known)
violation.
Any person who violates the Commissioner's cease and desist order is subject to...... Correct
Answer: a monetary penalty of up $10,000 for each violation.
What must the Commissioner pay to the Office of Treasury and Fiscal Services? Correct
Answer: all taxes, fees, charges, and penalties and interest collected
So it can be deposited to the State general fund.
A license may be refused, suspended or revoked by the Commissioner due to: Correct Answer: •
Fraudulent or dishonest practices;
• Holding a license for the purpose of securing rebates or commissions (controlled business);
• Lack of trustworthiness or competence;
• Knowingly over-insuring a risk;
• Failure to report to the Commissioner any criminal activity within 30 days of the date of arrest;
• Failure to report to the Commissioner any license suspension or revocation in another
jurisdiction within 60 days; or
• Failure to pay ordered child support.
, A person with a suspended license may... Correct Answer: still receive previously earned
commissions and renewal commissions.
Any action of the Commissioner may be appealed within _____ days to __________ of
_________ County. Correct Answer: 30 days
The Superior Court of Fulton County.
Types of Insurers
An Alien Insurer
A 'Foreign' Insurer
A 'Domestic' Insurer
A 'Mutual Insurer'
A 'Stock Insurer' Correct Answer: An Alien Insurer is an Insurer formed under the laws of
another country.
A 'Foreign' Insurer is an Insurer formed under the laws of another state.
A 'Domestic' Insurer is an Insurer formed under the laws of Georgia.
A 'Mutual Insurer' is an Insurer without stock or shares but which is owned and governed by its
policyholders.
A 'Stock Insurer' is Insurer with stock or shares and which is owned and governed by its
shareholders.
Authorized (Admitted) Insurers:
What must they obtain to be "admitted"?
How much does an Insurer have to have in capital to qualify?
What must Insurers file with the Commissioner? Correct Answer: -A Certificate of Authority to
be "admitted" to transact insurance in Georgia
-An Insurer must have at least $1.5 million in capital to qualify for a Certificate of Authority
-Insurers must file a detailed annual report with the Commissioner.
It is illegal for an Insurer to: Correct Answer: • Fail to use due diligence in paying all claims;
• Compel, without just cause, claimants to accept less than the amount due them; or
• Accept money, trade stamps, gifts, or other remuneration of any kind in return for referring
automobile and other property repair business including glass breakage to a particular
automobile repairer, glass company, contractor, construction company, or other repair company
of any kind.
The Commissioner of Insurance is elected for a _____ year term. Correct Answer: 4
The Commissioner has the authority to... Correct Answer: • Make rules and regulations after
giving notice to the public;
• Organize the DOI and assign duties to staff members;
• Issue orders (cease and desist orders) to agents or Insurers; and
• Regulate anything involving "transacting insurance."
"Transacting insurance" includes Correct Answer: • Solicitation and inducement;
• Preliminary negotiations;
• Effectuation of a contract of insurance; and
• Transaction of matters subsequent to effectuation of the contract and arising out of it.
Any cease and desist order from the Commissioner must..... Correct Answer: • Be written and
signed;
• State its effective date and purpose;
• Be delivered to the person to be ordered by mailing it to the person's principal place of business
or last address of record in the Commissioner's office.
At any time, the Commissioner may examine the records of: Correct Answer: • Any Insurer
authorized to do business in Georgia;
• Any licensed insurance agent, broker, counselor, or adjuster; and
• Any person transacting the business of insurance.
The Commissioner is required to examine who and how often? Correct Answer: • Domestic
Insurers at least once every 3 years; and
• Rating organizations at least once each 5 years.
What must the person being examined at the direction of the Commissioner pay? Correct
Answer: the Insurer must pay all the actual expenses of the examination beyond the cost of
regular Department employees.
With respect to an examination, investigation, or hearing, the Commissioner may...... Correct
Answer: take depositions, subpoena witnesses, administer oaths or affirmations, examine any
individual under oath, and compel the production of records, books, papers, and other
documents.
How must Subpoenas be served? What if the individual fails to obey the subpoena? Correct
Answer: In the same manner as if issued by a superior court. If any individual fails to obey a
subpoena, the Commissioner may request that the superior court of the county (in which the
proceeding is pending) issue an order requiring such individual to comply with the subpoena.
,The Commissioner may hold hearings for any purpose deemed necessary. But when MUST they
hold hearings? Correct Answer: The Commissioner must hold a hearing upon the written
demand of any person aggrieved by the Commissioner's act, threatened act, or failure to act.
What are the requirements for the hearing demanded by the aggrieved individual. Correct
Answer: • Must be held within 30 days of request;
• May be held at any place designated by the Commissioner;
• Must be open to the public;
• Requires that at least 10 days advance notice be given to all affected persons;
• Must allow the affected persons to testify, present evidence and witnesses, be represented by
counsel, and to subpoena witnesses and other evidence.
Who must the Commissioner inform when any criminal violation of insurance laws may have
occurred? How may the commissioner enforce any of their order? Correct Answer: must inform
the prosecuting attorney in whose circuit or jurisdiction any criminal violation of the insurance
laws may have occurred.
The Commissioner may bring legal action in the appropriate superior court to enforce any order
of the Commissioner.
If an Insurer, agent, broker, counselor, or adjuster has violated a statute, regulation, or order, the
Commissioner may: Correct Answer: • Place the person on probation for up to 1 year for each
violation;
• Suspend or revoke the person's license;
• Issue a monetary penalty of up to $1,000 for each unintentional violation; and
• Issue a monetary penalty of up to $5,000 for each intentional (knew or should have known)
violation.
Any person who violates the Commissioner's cease and desist order is subject to...... Correct
Answer: a monetary penalty of up $10,000 for each violation.
What must the Commissioner pay to the Office of Treasury and Fiscal Services? Correct
Answer: all taxes, fees, charges, and penalties and interest collected
So it can be deposited to the State general fund.
A license may be refused, suspended or revoked by the Commissioner due to: Correct Answer: •
Fraudulent or dishonest practices;
• Holding a license for the purpose of securing rebates or commissions (controlled business);
• Lack of trustworthiness or competence;
• Knowingly over-insuring a risk;
• Failure to report to the Commissioner any criminal activity within 30 days of the date of arrest;
• Failure to report to the Commissioner any license suspension or revocation in another
jurisdiction within 60 days; or
• Failure to pay ordered child support.
, A person with a suspended license may... Correct Answer: still receive previously earned
commissions and renewal commissions.
Any action of the Commissioner may be appealed within _____ days to __________ of
_________ County. Correct Answer: 30 days
The Superior Court of Fulton County.
Types of Insurers
An Alien Insurer
A 'Foreign' Insurer
A 'Domestic' Insurer
A 'Mutual Insurer'
A 'Stock Insurer' Correct Answer: An Alien Insurer is an Insurer formed under the laws of
another country.
A 'Foreign' Insurer is an Insurer formed under the laws of another state.
A 'Domestic' Insurer is an Insurer formed under the laws of Georgia.
A 'Mutual Insurer' is an Insurer without stock or shares but which is owned and governed by its
policyholders.
A 'Stock Insurer' is Insurer with stock or shares and which is owned and governed by its
shareholders.
Authorized (Admitted) Insurers:
What must they obtain to be "admitted"?
How much does an Insurer have to have in capital to qualify?
What must Insurers file with the Commissioner? Correct Answer: -A Certificate of Authority to
be "admitted" to transact insurance in Georgia
-An Insurer must have at least $1.5 million in capital to qualify for a Certificate of Authority
-Insurers must file a detailed annual report with the Commissioner.
It is illegal for an Insurer to: Correct Answer: • Fail to use due diligence in paying all claims;
• Compel, without just cause, claimants to accept less than the amount due them; or
• Accept money, trade stamps, gifts, or other remuneration of any kind in return for referring
automobile and other property repair business including glass breakage to a particular
automobile repairer, glass company, contractor, construction company, or other repair company
of any kind.
