Life Insurance/ annuities 2-14
1. Which of the following individuals MUST be licensed as an agent?: A person who places insurance on behalf of
anyone seeking insurance.
2. Which of the following statements regarding a nonresident insurance agent is CORRECT?: The agent must hold a similar
license in their state of residence 3. State insurance laws specifically allow the Commissioner(or Director) to issue a temporary
license to which of the following individuals?: A surviving spouse of a deceased agent
4. A person is required to be AT LEAST how old before he or she is licensed as an agent in most states?: 18
5. Insurance agents must notify the Commissioner(or Director) of a change of home address within a MAXIMUM of how many
days?: 30
6. An agent's license can be suspended or revoked by...: Writing primarily controlled business
7. Which of the following activities will NOT result in the suspension of an agent's license.: Working for an foreign insurer.
8. All of the following will result in the suspension of an agent's license
EXCEPT....: Acting with fiduciary responsibility
9. Which of the following acts is an agent NOT authorized to do on behalf of an insurer?: Authorize claim payments
10. According to state insurance law, while transacting insurance business, agents act as representative of...: The insurer
11. An insurance broker is a representative of...: Insured
12. T is an agent and when hired, is reminded that he has a responsibility to handle clients' funds in an honest and ethical
manner. This responsibility is referred to as...: Fiduciary responsibility
13. Insurance companies that are organized in countries outside the United
States are referred to as...: Alien
14. An insurance company incorporated under the laws of the state in which its home office is located is called a(n)_____
company: Domestic
15. If an insurance company is organized under the laws of New Jersey and licensed to do business here, it is considered which
of the following in
Texas?: A foreign company
16. An insurance company that is incorporated in New Hampshire and does business in Florida is defined in Florida as...: A
foreign insurer
17. A foreign insurance company is one that is incorporated...: Under the laws of another state
18. In order for domestic, foreign, or alien insurance company to conduct business, it must be authorized by whom?: The state
where they are conducting business
19 A certificate of authority does which of the following?: Permits an insurance company to transact business in that state
20. Before approving an application for a business entity acting as an agent, the Commissioner(or Director) must find that the
business entity has...: Designate an agent to be responsible for compliance with insurance laws
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, Life Insurance/ annuities 2-14
21. If an insured sustains a loss on a policy sold by an agent through an insurance company that is not authorized to do
business in that particular state, which of the following would be liable?: The agent and the company
22. Which of the following is NOT a consequence for placing business with an unauthorized insurer?: First degree
misdemeanor
23. All of the following are defined as doing insurance business EXCEPT...: Selling mutual funds
24. What is the main reason for regulating the insurance industry?: Maintain the solvency of insurance companies.
25. The insurance Commissioner(or Director) may examine the records of an insurance company on order to...: Determine
the solvency of the company
26. The Commissioner(or Director) of insurance has the power to...: Conduct examinations of insurance companies
27. The Commissioner(or Director) of insurance may suspend, revoke, or refuse to renew the license of an agent who...: Is
found guilty of misrepresentation or fraud on obtaining the license.
28. The Commissioner(or Director) of insurance is empowered to...: Enforce state laws relating to insurance
29. Which of the following can an agent provide to help a prospective client understand and purchase the most appropriate
product?: Buyer's guide 30. The insurer must provide a prospective buyer with...: A Buyer's Guide and Policy Summary
31. An agent may legally share commissions only with...: Another agent who is licensed in the same line of insurance
32. An insurance company may compensate all of the following people EX-
CEPT...: Licensed agent not appointed by the company
33. Which Unfair Trade Practice involves making a false statement on an insurance application in order to receive money from
an insurer?: Misrepresentation 34. An example of an unfair trade practice is...: A agent making a material
misrepresenation to the insured
35. Which Unfair Trade Practice involves an agent suggesting that an insurance policy is like a share of stock?:
Misrepresentation
36. An agent who tells a client that diviended are guaranteed may be guilty of...: Misrepresentation
37 During the course of an insurance transaction, if an agent makes a false or incomplete statement, he or she could be found
guilty of...: Misrepresentation 38. Convincing a prospective insured to buy an insurance policy based on exaggerations is called...:
Misrepresentation
39. Deceptive advertising is considered to be...: A form of misrepresentation
40. All of the following constitue an unfair trade practice under State law EXCEPT...: Attemping to replace coverage written
by another agent within one year of its issue date
41. The act of an insurance company publishing misleading information about its policy's provisions is called: False advertising
42. An insurance company that promises lower insurance rates than any othr company in the country may be charged with...:
False advertising
43. An insurance company may be judged guilty of false advertising if...: Exaggerates its dividends in a newspaper
advertisement
2/7
1. Which of the following individuals MUST be licensed as an agent?: A person who places insurance on behalf of
anyone seeking insurance.
2. Which of the following statements regarding a nonresident insurance agent is CORRECT?: The agent must hold a similar
license in their state of residence 3. State insurance laws specifically allow the Commissioner(or Director) to issue a temporary
license to which of the following individuals?: A surviving spouse of a deceased agent
4. A person is required to be AT LEAST how old before he or she is licensed as an agent in most states?: 18
5. Insurance agents must notify the Commissioner(or Director) of a change of home address within a MAXIMUM of how many
days?: 30
6. An agent's license can be suspended or revoked by...: Writing primarily controlled business
7. Which of the following activities will NOT result in the suspension of an agent's license.: Working for an foreign insurer.
8. All of the following will result in the suspension of an agent's license
EXCEPT....: Acting with fiduciary responsibility
9. Which of the following acts is an agent NOT authorized to do on behalf of an insurer?: Authorize claim payments
10. According to state insurance law, while transacting insurance business, agents act as representative of...: The insurer
11. An insurance broker is a representative of...: Insured
12. T is an agent and when hired, is reminded that he has a responsibility to handle clients' funds in an honest and ethical
manner. This responsibility is referred to as...: Fiduciary responsibility
13. Insurance companies that are organized in countries outside the United
States are referred to as...: Alien
14. An insurance company incorporated under the laws of the state in which its home office is located is called a(n)_____
company: Domestic
15. If an insurance company is organized under the laws of New Jersey and licensed to do business here, it is considered which
of the following in
Texas?: A foreign company
16. An insurance company that is incorporated in New Hampshire and does business in Florida is defined in Florida as...: A
foreign insurer
17. A foreign insurance company is one that is incorporated...: Under the laws of another state
18. In order for domestic, foreign, or alien insurance company to conduct business, it must be authorized by whom?: The state
where they are conducting business
19 A certificate of authority does which of the following?: Permits an insurance company to transact business in that state
20. Before approving an application for a business entity acting as an agent, the Commissioner(or Director) must find that the
business entity has...: Designate an agent to be responsible for compliance with insurance laws
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, Life Insurance/ annuities 2-14
21. If an insured sustains a loss on a policy sold by an agent through an insurance company that is not authorized to do
business in that particular state, which of the following would be liable?: The agent and the company
22. Which of the following is NOT a consequence for placing business with an unauthorized insurer?: First degree
misdemeanor
23. All of the following are defined as doing insurance business EXCEPT...: Selling mutual funds
24. What is the main reason for regulating the insurance industry?: Maintain the solvency of insurance companies.
25. The insurance Commissioner(or Director) may examine the records of an insurance company on order to...: Determine
the solvency of the company
26. The Commissioner(or Director) of insurance has the power to...: Conduct examinations of insurance companies
27. The Commissioner(or Director) of insurance may suspend, revoke, or refuse to renew the license of an agent who...: Is
found guilty of misrepresentation or fraud on obtaining the license.
28. The Commissioner(or Director) of insurance is empowered to...: Enforce state laws relating to insurance
29. Which of the following can an agent provide to help a prospective client understand and purchase the most appropriate
product?: Buyer's guide 30. The insurer must provide a prospective buyer with...: A Buyer's Guide and Policy Summary
31. An agent may legally share commissions only with...: Another agent who is licensed in the same line of insurance
32. An insurance company may compensate all of the following people EX-
CEPT...: Licensed agent not appointed by the company
33. Which Unfair Trade Practice involves making a false statement on an insurance application in order to receive money from
an insurer?: Misrepresentation 34. An example of an unfair trade practice is...: A agent making a material
misrepresenation to the insured
35. Which Unfair Trade Practice involves an agent suggesting that an insurance policy is like a share of stock?:
Misrepresentation
36. An agent who tells a client that diviended are guaranteed may be guilty of...: Misrepresentation
37 During the course of an insurance transaction, if an agent makes a false or incomplete statement, he or she could be found
guilty of...: Misrepresentation 38. Convincing a prospective insured to buy an insurance policy based on exaggerations is called...:
Misrepresentation
39. Deceptive advertising is considered to be...: A form of misrepresentation
40. All of the following constitue an unfair trade practice under State law EXCEPT...: Attemping to replace coverage written
by another agent within one year of its issue date
41. The act of an insurance company publishing misleading information about its policy's provisions is called: False advertising
42. An insurance company that promises lower insurance rates than any othr company in the country may be charged with...:
False advertising
43. An insurance company may be judged guilty of false advertising if...: Exaggerates its dividends in a newspaper
advertisement
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