1|Page
WA SURPLUS LINES BROKER EXAM 2025, WASHINGTON
INSURANCE EXAM, SURPLUS LINES LICENSING, BROKER
COMPLIANCE WA, UNDERWRITING AND PLACEMENT, WA BROKER
TEST, VERIFIED ANSWERS
As specified in RCW 48.15.150, each policy issued to an unauthorized insurer as a surplus line
contract must designate _______ as the person upon whom service of process may be made.
A. CFO
B. SLB
C. Commissioner
D. Attorney - ANSWER-C - Commissioner
Return premiums or claim payments will not be deemed to have been paid to the insured or
claimant until the payments are actually received by the
A) Insurance Producer
B) Insured/Claimant
C) SLB - ANSWER-B) Insured/Claimant
How many days notice required for cancellation due to non-payment of premium? - ANSWER-10
days
How many days notice is required to cancel Surplus Line policy (other than non-pay)? -
ANSWER-20 days
The certification form must be filed within ___ days of the effective date:
A) 30
B) 90
,2|Page
C) 60
D) 20 - ANSWER-C - 60 days
Two key tools within IRIS (Insurance Regulatory Information System)
A) Ratios
B) Inspections
C) Analyst Team System
D) Examinations
E) C, D
F) A, C - ANSWER-IRIS ratios and Analyst Team System
Max credit/surcharge for Account Premium Modification Plan - ANSWER-25%
Available to risks that develop a 3 year premium of at least $5,000
Agreed amount eliminates the ______ clause - ANSWER-Coinsurance
What organization decides alien insurers have fulfilled criteria and can be included on the
Quarterly Listing of Alien Insurers'?
A) NAIC
B) IRIS
C) IIDPO
D) Lloyd's - ANSWER-C- International Insurers Department Plan of Operation
What information can you find on the Quarterly Listing of Alien Insurers?
A) location of trust account
B) min required balance or trust account
,3|Page
C) market value of trust account
D) if account is funded by letter of credit
E) all of the above - ANSWER-E - along with trustee bank contacts with telephone and fax #
What AM Best Rating categories are considered Investment Grade for Long-Term credit?
A) aaa
B) aa
C) a
D) bbb
E) all of the above - ANSWER-E) aaa, aa, a, and bbb are all considered investment grade
What AM Best Rating categories are considered Investment Grade for Short-Term credit?
A) AMB-1+
B) AMB-1
C) AMB-2
D) AMB-3
E) all of the above - ANSWER-E) all of the above
What AM Best Financial Strength Rating are considered secure?
A) A++, A+
B) A, A-
C) B++, B+
D) all of the above - ANSWER-D) all of the above (superior, excellent, good)
Lloyd's of London can write on admitted paper in what states/territories? - ANSWER-Virgin
Islands, Illinois, and Kentucky
, 4|Page
Which organization body is responsible for regulating Lloyd's (including direct supervision of
managing agents and monitoring capital solvency)? - ANSWER-FSA - Financial Service Authority
Which bank handles Lloyd's NY Trust Fund? - ANSWER-City Bank
Gross Premiums Written to Policyholders Surplus should be what ratio?
A) 9 to 1
B) 1 to 9
C) 3 to 1
D) 1 to 3 - ANSWER-Gross premiums should be 9 to 1
Is the term 'unusual value' on a financial ratio report good, bad, or not important? - ANSWER-
Unusual values are BAD.
Where can you find the amount of Direct Premiums Written, Reinsurance Assumed -Affiliates, &
Reinsurance Assumed - Non-Affiliates? - ANSWER-On the Underwriting & Investment Exhibit
page (8)
Where can you find the amount of Policyholders Surplus? - ANSWER-The Liabilities, Surplus, and
Other Funds page (3)
How do you find the ratio for 'Gross Premiums Written to Policyholders Surplus'? - ANSWER-
Direct Premiums Written + Reinsurance Assumed - Affiliates + Reinsurance Assumed Non-
Affiliates / Policyholders Surplus * 100
(A + B + C) / D * 100
Should be 9 to 1
WA SURPLUS LINES BROKER EXAM 2025, WASHINGTON
INSURANCE EXAM, SURPLUS LINES LICENSING, BROKER
COMPLIANCE WA, UNDERWRITING AND PLACEMENT, WA BROKER
TEST, VERIFIED ANSWERS
As specified in RCW 48.15.150, each policy issued to an unauthorized insurer as a surplus line
contract must designate _______ as the person upon whom service of process may be made.
A. CFO
B. SLB
C. Commissioner
D. Attorney - ANSWER-C - Commissioner
Return premiums or claim payments will not be deemed to have been paid to the insured or
claimant until the payments are actually received by the
A) Insurance Producer
B) Insured/Claimant
C) SLB - ANSWER-B) Insured/Claimant
How many days notice required for cancellation due to non-payment of premium? - ANSWER-10
days
How many days notice is required to cancel Surplus Line policy (other than non-pay)? -
ANSWER-20 days
The certification form must be filed within ___ days of the effective date:
A) 30
B) 90
,2|Page
C) 60
D) 20 - ANSWER-C - 60 days
Two key tools within IRIS (Insurance Regulatory Information System)
A) Ratios
B) Inspections
C) Analyst Team System
D) Examinations
E) C, D
F) A, C - ANSWER-IRIS ratios and Analyst Team System
Max credit/surcharge for Account Premium Modification Plan - ANSWER-25%
Available to risks that develop a 3 year premium of at least $5,000
Agreed amount eliminates the ______ clause - ANSWER-Coinsurance
What organization decides alien insurers have fulfilled criteria and can be included on the
Quarterly Listing of Alien Insurers'?
A) NAIC
B) IRIS
C) IIDPO
D) Lloyd's - ANSWER-C- International Insurers Department Plan of Operation
What information can you find on the Quarterly Listing of Alien Insurers?
A) location of trust account
B) min required balance or trust account
,3|Page
C) market value of trust account
D) if account is funded by letter of credit
E) all of the above - ANSWER-E - along with trustee bank contacts with telephone and fax #
What AM Best Rating categories are considered Investment Grade for Long-Term credit?
A) aaa
B) aa
C) a
D) bbb
E) all of the above - ANSWER-E) aaa, aa, a, and bbb are all considered investment grade
What AM Best Rating categories are considered Investment Grade for Short-Term credit?
A) AMB-1+
B) AMB-1
C) AMB-2
D) AMB-3
E) all of the above - ANSWER-E) all of the above
What AM Best Financial Strength Rating are considered secure?
A) A++, A+
B) A, A-
C) B++, B+
D) all of the above - ANSWER-D) all of the above (superior, excellent, good)
Lloyd's of London can write on admitted paper in what states/territories? - ANSWER-Virgin
Islands, Illinois, and Kentucky
, 4|Page
Which organization body is responsible for regulating Lloyd's (including direct supervision of
managing agents and monitoring capital solvency)? - ANSWER-FSA - Financial Service Authority
Which bank handles Lloyd's NY Trust Fund? - ANSWER-City Bank
Gross Premiums Written to Policyholders Surplus should be what ratio?
A) 9 to 1
B) 1 to 9
C) 3 to 1
D) 1 to 3 - ANSWER-Gross premiums should be 9 to 1
Is the term 'unusual value' on a financial ratio report good, bad, or not important? - ANSWER-
Unusual values are BAD.
Where can you find the amount of Direct Premiums Written, Reinsurance Assumed -Affiliates, &
Reinsurance Assumed - Non-Affiliates? - ANSWER-On the Underwriting & Investment Exhibit
page (8)
Where can you find the amount of Policyholders Surplus? - ANSWER-The Liabilities, Surplus, and
Other Funds page (3)
How do you find the ratio for 'Gross Premiums Written to Policyholders Surplus'? - ANSWER-
Direct Premiums Written + Reinsurance Assumed - Affiliates + Reinsurance Assumed Non-
Affiliates / Policyholders Surplus * 100
(A + B + C) / D * 100
Should be 9 to 1
