Insurance Regulations and Powers in Washington State, Exams of Law

Download Insurance Regulations and Powers in Washington State and more Exams Law in PDF only on Docsity! 1 [Date] Page 1 Washington Laws- Rules and Regulations 47 Questions with Answers 2024 Broad Powers - ✓✓✓The general powers, duties and responsibilities of the Commissioner include, but are not limited to the following: adopt rules and regulations to enforce provisions of the Insurance Code: conduct examinations, investigations, and hearings to determine whether any person has violated any provisions of the Code; maintain confidentiality of documents, materials, or other information used in regulatory or legal action; issue insurance licenses and certificate of authority, and take action against, fine or suspend the license of any company and/or producers; appoint a Chief Deputy Commissioner to assist the Commissioner, as well as additional deputies. Examination of Records - ✓✓✓The purpose of the examination is to ensure that the companies remain solvent and conduct business of insurance in compliance with state laws and regulations pertaining to licensing, policy forms, rates, claim and market conduct. Rates and Forms - ✓✓✓An insurance policy form or written application issued, delivered, or used in this state must be first filed with and approved by the Commissioner. Penalties (COMMISSIONER) - ✓✓✓The Commissioner has the power to suspend, revoke or refuse to issue or renew a producer license, as well as levy a fine as established by state law for violation in any of the following 2 [Date] Page 2 areas of producer activities: laws, rules, or regulations of the insurance code. Unlicensed Activities - ✓✓✓ Insurance - ✓✓✓An insurance contract is an agreement between a policy owner and an insurer. Insurer - ✓✓✓An insurer is any person or company engaged as the principal party in the business of entering into insurance contracts. Insurance Transaction - ✓✓✓No insurance company or agent may pay a commission, service, or other valuable consideration to a person for selling, soliciting or negotiating insurance in this state if that person is not properly licensed. Authorized vs. Unauthorized Insurers and Certificate of Authority - ✓✓✓Before an insurer may transact business in a specific state, they must apply for a license, or Certificate of Authority from the state Department of Insurance and meet any financial requirements set down by the state. Each violation constitutes a separate offense punishable by a suspension or revocation of a license, and a maxmium fine of 25,000 Domestic, Foreign, Alien - ✓✓✓Domestic - in state Foreign - different state Alien - different country or out of contry 5 [Date] Page 5 be fully paid at a time between 15-30 days from the date of the order. If the fine is not paid by the due date, the Commissioner will revoke the licenses of the licensee, if it is not already revoked. Renewal - ✓✓✓Once a license is issued it's the licensee's responsibility to maintain an active license. In this state initial and reinstated licenses are valid from the date they are issued until the licensee's next birthday anniversary, plus a year. Continuing Education - ✓✓✓Every licensed producer is required to complete continuing education requirements every 2 years with except of resident adjusters, individuals holding only limited credit insurance, travel insurance, or surety licenses. A producer must complete 24 hours of CE and 3 hours of ethics. The insurance education provider must issue a certificate of completion within 10 days. An approved course for which the licensee has previously claimed credit may be repeated for credit after a period of 3 years from the previous credit date. The licensee must retain the certificate of completion for 3 years from the date on the certificate. Late Renewal / Reinstatement - ✓✓✓Whenever a producer submits a request for a license renewal after due date, the producer may not transact business renewal or reinstatement is complete. Days Late: 1-30 50% 31-60 100% 61- 12 months 200% 6 [Date] Page 6 Protection of Public Interest - ✓✓✓The business of insurance is one affected by the public interest, requiring that all persons act in good faith abstain from deception, and practice honesty and equity in all insurance matters. Unfair Practices - ✓✓✓Insurers and producers transacting insurance in this state must not engage in any unfair methods of competition or unfair trade practices. Producers, Compensation, Disclosure - ✓✓✓I know what a producer is, and compensation, an act of identifying the name of a producer, representative or firm, or temporary producer on any policy solicitation. Rebating / Illegal dealing in premiums - ✓✓✓Rebating is defined as any inducement offered in the sale of insurance products that is NOT specified in the policy. Rebates include money, prizes, or merchandise, and could also include reductions in commissions, promises, employment, dividends, stock and personal services. Illegal Inducements - ✓✓✓It is unlawful to offer any of the following as an inducement to buy insurance: any shares of stock or securities; any special advisory board contact; any agreement promising profits, special returns or special dividends; or any prizes or goods with an aggregate value in excess of 25. Twisting - ✓✓✓Is a misrepresentation, or incomplete or fraudulent comparison of insurance policies that persuades an insured/owner, to his 7 [Date] Page 7 or her detriment, or to cancel, lapse, switch policies, or take out a policy with another insurer. Twisting is prohibited. Misrepresentation - ✓✓✓It is illegal to issue, publish, or circulate any illustration or sales material that is false, misleading, or deceptive as to policy benefits or terms, the payment of dividends, etc. This also refers to oral statements. Committing this illegal act is called MISREPRESENTATION. Defamation of an Insurer - ✓✓✓Defamation occurs when an oral or written statement is made that is intended to injure a person engaged in the insurance business. This also applies to statements that are maliciously critical of the financial condition of any person or company. Discrimination - ✓✓✓In rates, premiums, or policy benefits for persons within the same class or with marital status, race, national origin, gender identity, sexual orientation, creed, or ancestry unless the distinction is made for a business purpose or required by law. Failure to issue proper receipts - ✓✓✓Any producer or other representative of an insurer who receives a contract payment or premium from or on behalf of an insured or applicant for insurance annuities must deliver a signed receipt as promptly as possible (generally no later than the next business day). Advertising - ✓✓✓You can't mention the Guarantee Association IN any advertisement, it is considered an unfair trade practice. Also, whatever