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PA Life & Health practice questions

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Question 1Pennsylvania Insurance Law, Regulations and Department Notices

How is the Pennsylvania Insurance Commissioner selected?

  1. Elected by voters in a statewide general election
  2. Selected by the Insurance Department's senior staff
  3. Chosen by a vote of licensed Pennsylvania insurers
  4. Appointed by the Governor with Senate confirmation Correct answer.

Explanation

The Commissioner heads the Pennsylvania Insurance Department as a cabinet-level official nominated by the Governor and confirmed by the Senate. The office is an appointive one, and the Commissioner directs enforcement of the Commonwealth's insurance laws.

Question 2Pennsylvania Insurance Law, Regulations and Department Notices

How much continuing education must a Pennsylvania insurance producer complete every two years?

  1. 24 hours, including 3 hours of ethics Correct answer.
  2. 36 hours, including 6 hours of ethics
  3. 30 hours, including 4 hours of ethics
  4. 12 hours, including 2 hours of ethics

Explanation

Pennsylvania requires producers to complete 24 hours of approved continuing education during each two-year licensing period, and at least 3 of those hours must be in ethics. Credit is granted only for courses approved by the Department.

Question 3Pennsylvania Insurance Law, Regulations and Department Notices

An individual life insurance policy delivered in Pennsylvania must give the owner at least how long to review it and return it for a refund?

  1. 10 days Correct answer.
  2. 5 days
  3. 30 days
  4. 3 days

Explanation

Pennsylvania law requires a free-look period of at least 10 days after delivery of an individual life policy. If the owner returns the policy within that period, the policy is treated as though it never took effect and the premium is refunded.

Question 4Pennsylvania Insurance Law, Regulations and Department Notices

What is the minimum grace period required in an individual life insurance policy issued in Pennsylvania?

  1. 30 days Correct answer.
  2. 7 days
  3. 10 days
  4. 15 days

Explanation

Individual life policies delivered in Pennsylvania must provide a grace period of at least 30 days for payment of overdue premium. Coverage remains in force throughout the grace period, and the insurer may deduct the unpaid premium from any settlement.

Question 5Pennsylvania Insurance Law, Regulations and Department Notices

What is the maximum death benefit the Pennsylvania Life and Health Insurance Guaranty Association will pay for any one insured life?

  1. $300,000 in death benefits Correct answer.
  2. $250,000 in death benefits
  3. $500,000 in death benefits
  4. $100,000 in death benefits

Explanation

The Pennsylvania guaranty association caps death benefit protection at $300,000 per insured life. Cash surrender values and health benefits are capped separately at $100,000, and annuity present values at $250,000.

Question 6Pennsylvania Insurance Law, Regulations and Department Notices

How often must a Pennsylvania resident insurance producer license be renewed?

  1. Every four years
  2. Every two years Correct answer.
  3. Every year
  4. Every three years

Explanation

Pennsylvania resident producer licenses are renewed on a two-year cycle, and the required continuing education must be finished before each renewal. Failure to renew terminates the authority to solicit or sell insurance.

Question 7Pennsylvania Insurance Law, Regulations and Department Notices

Which practice is prohibited by Pennsylvania's Unfair Insurance Practices Act?

  1. Explaining a policy's exclusions at delivery
  2. Quoting the premium rate the insurer has filed
  3. Sharing the producer's commission with the buyer Correct answer.
  4. Mailing the issued policy to the policyholder

Explanation

Rebating occurs when a producer offers an applicant something of value that is not stated in the contract, such as a share of the commission, to induce the purchase. Pennsylvania treats rebating as an unfair trade practice subject to penalties.

Question 8Pennsylvania Insurance Law, Regulations and Department Notices

How must a Pennsylvania producer hold premiums collected from an applicant?

  1. In trust and kept separate from personal funds Correct answer.
  2. As the producer's earned income once the application is signed
  3. In the producer's regular business operating account
  4. As an advance payable to the producer immediately

Explanation

Premium money collected by a producer is held in a fiduciary capacity; it belongs to the insurer or the applicant, not the producer. Commingling those funds with the producer's own money is prohibited and can support license action.

Question 9Pennsylvania Insurance Law, Regulations and Department Notices

A Pennsylvania producer is taking an application for a policy that will replace the applicant's existing life insurance. What must the producer do?

  1. Wait 30 days before submitting the application
  2. Provide a replacement notice naming each replaced policy Correct answer.
  3. Obtain the Insurance Department's written approval of the sale
  4. Refund any commission already earned on the sale

Explanation

Pennsylvania replacement rules require the producer to present a notice regarding replacement that identifies the existing coverage being dropped and to leave a copy with the applicant. The insurer also receives notice so it can compare the old and new coverage.

Question 10Pennsylvania Insurance Law, Regulations and Department Notices

After an insurer appoints a Pennsylvania producer, within what period must the appointment be reported to the Insurance Department?

  1. 45 days
  2. 10 days
  3. 60 days
  4. 30 days Correct answer.

Explanation

The insurer must file notice of the appointment with the Department, generally within 30 days of making it, and the producer may not submit business for that insurer before the appointment is in place. Appointment gives the producer authority to act on the insurer's behalf.

Question 11Pennsylvania Insurance Law, Regulations and Department Notices

When an insurer ends a producer's appointment, within what period must the insurer notify the Insurance Department?

  1. 90 days
  2. 10 days
  3. 5 days
  4. 30 days Correct answer.

Explanation

Pennsylvania requires the insurer to notify the Department of a terminated appointment within 30 days, and the producer must also be informed. The notice protects consumers by ending apparent authority promptly.

Question 12Pennsylvania Insurance Law, Regulations and Department Notices

What is the primary purpose of a market conduct examination conducted by the Pennsylvania Insurance Department?

  1. Setting the commission rates insurers pay producers
  2. Approving individual producers' advertising budgets
  3. Reviewing the financial soundness of non-insurance affiliates
  4. Determining whether insurers comply with state law Correct answer.

Explanation

Market conduct examinations look at how an insurer actually treats policyholders, including sales, underwriting, rating, claims, and complaint handling. The goal is to test compliance with the insurance statutes and Department regulations.

Question 13Pennsylvania Insurance Law, Regulations and Department Notices

A Pennsylvania producer suspects that an applicant used forged documents to obtain a policy. What should the producer do?

  1. Keep the premium and void the policy personally
  2. Report the matter only if it exceeds $5,000
  3. Report the suspected fraud to the Department Correct answer.
  4. Wait until a claim is filed before acting

Explanation

Pennsylvania's insurance fraud statutes are enforced through the Insurance Department and the Insurance Fraud Prevention Authority, and suspected fraudulent applications are to be reported. A producer has no authority to pocket premium or to cancel coverage unilaterally.

Question 14Pennsylvania Insurance Law, Regulations and Department Notices

For each willful violation of Pennsylvania's Unfair Insurance Practices Act, the Insurance Commissioner may impose a penalty of up to:

  1. $5,000
  2. $50,000
  3. $25,000
  4. $10,000 Correct answer.

Explanation

The Act authorizes a civil penalty of up to $5,000 for each violation, with the maximum raised to $10,000 for each willful violation. Penalties are imposed by the Commissioner after notice and an opportunity for a hearing.

Question 15Pennsylvania Insurance Law, Regulations and Department Notices

A producer misstates the terms of a client's current policy so the client will drop it and buy a new one. This practice is best described as:

  1. Churning
  2. Coercion
  3. Twisting Correct answer.
  4. Defamation

Explanation

Twisting is misrepresenting an existing policy in order to induce the policyholder to lapse or surrender it and purchase replacement coverage. The defining feature is the misleading comparison used to cause the replacement.

Question 16Pennsylvania Insurance Law, Regulations and Department Notices

A producer tells a loan applicant that credit life insurance is required to obtain the loan, although the coverage is optional. This conduct is:

  1. Prohibited only if the loan is later denied
  2. Permitted if the premium is disclosed
  3. Prohibited as an unfair trade practice Correct answer.
  4. Permitted if the applicant signs a consent form

Explanation

Representing optional coverage as a condition of obtaining credit is a prohibited practice often called sliding. Disclosure of the premium or a signed consent form does not cure the misstatement, and the violation does not depend on the loan's outcome.

Question 17Pennsylvania Insurance Law, Regulations and Department Notices

Pennsylvania's mini-COBRA law allows employees of certain small employers to continue group health coverage for up to how long?

  1. 6 months
  2. 36 months
  3. 18 months
  4. 9 months Correct answer.

Explanation

Pennsylvania's state continuation law applies to small employer group health plans, generally those with 2 to 19 employees, and permits up to 9 months of continued coverage. Federal COBRA applies to larger employers and provides longer continuation periods.

Question 18Pennsylvania Insurance Law, Regulations and Department Notices

Which action by an insurer is an unfair claim settlement practice under Pennsylvania law?

  1. Asking the beneficiary for a certified death certificate
  2. Ignoring claim correspondence for several months Correct answer.
  3. Using a licensed adjuster to review a claim
  4. Investigating a claim before paying it

Explanation

The Unfair Insurance Practices Act lists failure to acknowledge or act with reasonable promptness on claim communications as an unfair claim settlement practice. Insurers are expected to investigate and respond within reasonable timeframes.

Question 19Pennsylvania Insurance Law, Regulations and Department Notices

For a life insurance sale in Pennsylvania, an insurer may pay a commission only to:

  1. A friend of the applicant who made the introduction
  2. Any employee who brought in the application
  3. A licensed producer appointed by the insurer Correct answer.
  4. The applicant's attorney as a referral fee

Explanation

Compensation for selling insurance may go only to a person holding a valid producer license who has been appointed by the insurer. Paying an unlicensed person for a sale is prohibited and exposes both the payer and the recipient to penalties.

Question 20Pennsylvania Insurance Law, Regulations and Department Notices

A Pennsylvania producer must report an administrative action taken against her by another state's insurance regulator within:

  1. 20 days
  2. 30 days Correct answer.
  3. 10 days
  4. 5 days

Explanation

Producers must notify the Commissioner within 30 days of administrative actions, license denials or revocations, and certain criminal proceedings. The duty is ongoing and applies even when the matter arose outside Pennsylvania.

Question 21Pennsylvania Insurance Law, Regulations and Department Notices

The Pennsylvania Life and Health Insurance Guaranty Association will generally not cover a claim arising from:

  1. An annuity owned by a Pennsylvania resident
  2. A life policy issued by an insolvent licensed insurer
  3. A health policy issued by a licensed Pennsylvania insurer
  4. An insurer that was never licensed in Pennsylvania Correct answer.

Explanation

Guaranty association protection extends only to policies issued by insurers that were licensed in Pennsylvania at the time. Coverage placed with an unauthorized insurer falls outside the safety net, which is one reason licensing status matters to consumers.

Question 22Pennsylvania Insurance Law, Regulations and Department Notices

A producer whose license the Commissioner has revoked may seek judicial review of the order by appealing to:

  1. The federal district court for the district
  2. The county court of common pleas
  3. The Commonwealth Court Correct answer.
  4. The Pennsylvania Supreme Court

Explanation

The Commonwealth Court is Pennsylvania's appellate court for administrative agency decisions, so it hears appeals from orders of the Insurance Commissioner. Further review by the state Supreme Court is discretionary.

Question 23Pennsylvania Insurance Law, Regulations and Department Notices

An owner returns a newly delivered life policy on the ninth day of the free-look period and asks for a refund of the $1,500 annual premium paid. The insurer must:

  1. Refuse, because the policy was already in force for eight days
  2. Refund the full premium and treat the policy as void Correct answer.
  3. Refund the premium less the cost of coverage provided
  4. Refund the premium less a cancellation fee

Explanation

Returning the policy within the free-look period rescinds it as though it never took effect, and the insurer must return the entire premium without deduction. No cancellation fee or charge for the days of interim coverage may be subtracted.

Question 24Pennsylvania Insurance Law, Regulations and Department Notices

Under Pennsylvania law, an insurer may deliver a life insurance policy form to a policyholder only after the form has been:

  1. Certified by the National Association of Insurance Commissioners
  2. Reviewed by the state's actuarial advisory board
  3. Filed with the Insurance Department and not disapproved Correct answer.
  4. Approved by the producer's errors and omissions carrier

Explanation

Life insurance policy forms must be submitted to the Insurance Department before use and are subject to its review; the Commissioner may disapprove forms that violate the law or mislead consumers. A producer's carrier, an advisory board, and the NAIC have no approval authority over Pennsylvania forms.

Question 25Pennsylvania Insurance Law, Regulations and Department Notices

Before the Commissioner may impose a monetary penalty on an insurer for an unfair practice, the Commissioner must:

  1. Give notice and an opportunity for a hearing Correct answer.
  2. Publish the proposed penalty in a newspaper
  3. Obtain the approval of the state Attorney General
  4. Obtain a criminal conviction in court

Explanation

Penalties are administrative sanctions that may be imposed only after the Commissioner gives written notice of the charges and holds a hearing at which the insurer may respond. A criminal conviction is not a prerequisite to the civil penalty.

Question 26Pennsylvania Insurance Law, Regulations and Department Notices

In Pennsylvania, the Insurance Commissioner is selected in which manner?

  1. Selected by the senior staff of the Insurance Department
  2. Chosen by a majority vote of the General Assembly
  3. Appointed by the Governor with Senate consent Correct answer.
  4. Elected by the voters in a statewide general election

Explanation

The Insurance Commissioner is a cabinet-level official appointed by the Governor with the advice and consent of the Pennsylvania Senate. The Commissioner heads the Insurance Department and administers the Commonwealth's insurance laws and regulations.

Question 27Pennsylvania Insurance Law, Regulations and Department Notices

Within each two-year licensing period, a Pennsylvania insurance producer must complete at least how many hours of continuing education?

  1. 12 hours
  2. 30 hours
  3. 36 hours
  4. 24 hours Correct answer.

Explanation

Pennsylvania requires producers to complete 24 continuing education credit hours in each two-year licensing period. At least 3 of those hours must be devoted to ethics instruction.

Question 28Pennsylvania Insurance Law, Regulations and Department Notices

A temporary insurance producer license issued by the Pennsylvania Insurance Department remains valid for a maximum of:

  1. 12 months
  2. 180 days Correct answer.
  3. 90 days
  4. 60 days

Explanation

The Department may issue a temporary producer license for a period not exceeding 180 days, typically to continue a book of business after a producer dies or becomes incapacitated.

Question 29Pennsylvania Insurance Law, Regulations and Department Notices

An insurer that is organized under the laws of another state and holds a Pennsylvania certificate of authority is classified as:

  1. A foreign insurer Correct answer.
  2. A domestic insurer
  3. An alien insurer
  4. A reciprocal insurer

Explanation

Insurers are classified by their place of organization: an insurer formed under Pennsylvania law is domestic, one formed under the law of another U.S. state is foreign, and one formed outside the United States is alien.

Question 30Pennsylvania Insurance Law, Regulations and Department Notices

Before an insurer may legally transact insurance business in Pennsylvania, it must obtain which document from the Insurance Department?

  1. A performance bond
  2. A certificate of authority Correct answer.
  3. A letter of credit
  4. A certificate of incorporation

Explanation

An insurer must hold a certificate of authority issued by the Insurance Department before transacting insurance in Pennsylvania. Transacting insurance without that authorization is unlawful.

Question 31Pennsylvania Insurance Law, Regulations and Department Notices

To persuade a prospect to sign a life insurance application, a Pennsylvania producer offers a $200 gift card that is not mentioned in the policy. This offer is:

  1. Unlawful rebating Correct answer.
  2. Lawful if the producer reports it to the Department
  3. Lawful because small gifts are excluded from the statute
  4. Lawful because the prospect is a personal friend

Explanation

Offering anything of value that is not specified in the policy to induce a sale is rebating, which Pennsylvania prohibits as an unfair trade practice. No disclosure or filing cures a rebate.

Question 32Pennsylvania Insurance Law, Regulations and Department Notices

An individual accident and health insurance policy delivered to a policyholder in Pennsylvania must allow the policyholder how many days to examine the policy and return it for a full refund of premium?

  1. 20 days
  2. 10 days Correct answer.
  3. 5 days
  4. 3 days

Explanation

Pennsylvania requires individual accident and health policies to include a free-look right of at least 10 days, during which the policyholder may return the contract for a full premium refund.

Question 33Pennsylvania Insurance Law, Regulations and Department Notices

The Pennsylvania Life and Health Insurance Guaranty Association will pay death benefits on a covered life insurance policy up to which amount per insured life?

  1. $50,000
  2. $100,000
  3. $250,000
  4. $300,000 Correct answer.

Explanation

Under the Pennsylvania Life and Health Insurance Guaranty Association Act, death benefits are covered up to $300,000 per insured life. Lower statutory limits apply to cash surrender values, health benefits, and annuity present values.

Question 34Pennsylvania Insurance Law, Regulations and Department Notices

A Pennsylvania producer must notify the Insurance Department of a change in her business address within:

  1. 90 days
  2. 30 days Correct answer.
  3. 60 days
  4. 10 days

Explanation

Licensees must keep the Department informed of their current business address and must report a change within 30 days of the change.

Question 35Pennsylvania Insurance Law, Regulations and Department Notices

A licensed Pennsylvania producer is criminally charged. She must report the matter to the Department within 30 days after:

  1. the initial pretrial hearing Correct answer.
  2. the filing of the criminal complaint
  3. the date of her arrest
  4. the final disposition of the case

Explanation

Pennsylvania requires a producer to report a criminal prosecution to the Department within 30 days after the initial pretrial hearing. A separate report is also required when the case is concluded.

Question 36Pennsylvania Insurance Law, Regulations and Department Notices

A producer who is licensed and in good standing in another state applies for a Pennsylvania nonresident producer license. Pennsylvania will generally:

  1. Require her to establish Pennsylvania residency within 90 days
  2. Require her to pass the Pennsylvania licensing examination
  3. Issue a license based on her home-state license in good standing Correct answer.
  4. Deny the license because she is not a Pennsylvania resident

Explanation

Pennsylvania licenses nonresidents on a reciprocal basis, relying on the home-state license when that license is in good standing and the home state extends similar treatment. The Pennsylvania examination is ordinarily waived.

Question 37Pennsylvania Insurance Law, Regulations and Department Notices

To obtain a Pennsylvania insurance producer license, a business entity must:

  1. Maintain a staffed office within Pennsylvania
  2. License every officer and director as a producer
  3. Name a designated licensed producer for compliance Correct answer.
  4. Be organized as a corporation under Pennsylvania law

Explanation

A business entity license requires the entity to designate an individual who holds a producer license and is responsible for the entity's compliance with insurance laws and regulations.

Question 38Pennsylvania Insurance Law, Regulations and Department Notices

The expenses incurred by the Insurance Department in examining an insurer's affairs, including the compensation of examiners, are paid by:

  1. The Life and Health Insurance Guaranty Association
  2. The insurer being examined Correct answer.
  3. The Commonwealth's general fund
  4. The Insurance Department's operating budget

Explanation

Examined insurers bear the cost of Department examinations, including examiner compensation and related expenses. This keeps examination costs off the Department's own budget.

Question 39Pennsylvania Insurance Law, Regulations and Department Notices

Before suspending a producer's license, the Insurance Commissioner ordinarily must:

  1. Obtain a court order authorizing the suspension
  2. Wait until the license comes up for renewal
  3. Obtain the Attorney General's written approval
  4. Hold a hearing at which the licensee may be heard Correct answer.

Explanation

Administrative due process requires the Commissioner to give the licensee notice of the grounds and an opportunity to be heard before imposing license discipline. Final orders may then be appealed to Commonwealth Court.

Question 40Pennsylvania Insurance Law, Regulations and Department Notices

A producer tells prospects that a competing insurer is insolvent, knowing the statement is false and intending to harm the competitor. Under Pennsylvania insurance law, this conduct is:

  1. Defamation of an insurer, an unfair practice Correct answer.
  2. A lawful expression of personal opinion
  3. Permitted unless the statement is made in writing
  4. Permissible comparison advertising

Explanation

Falsely stating that an insurer is in poor financial condition, with intent to injure, is defamation of an insurer and is listed among the unfair practices prohibited by Pennsylvania law.

Question 41Pennsylvania Insurance Law, Regulations and Department Notices

An insurer charges two applicants of the same age and health classification different premiums for identical life insurance coverage. This practice is:

  1. Acceptable underwriting judgment
  2. Lawful if both applicants consent
  3. Unfair discrimination Correct answer.
  4. A permitted rate classification

Explanation

Pennsylvania's Unfair Insurance Practices Act forbids unfair discrimination, meaning different rates for individuals of the same class and equal expectation of life for the same coverage.

Question 42Pennsylvania Insurance Law, Regulations and Department Notices

An insurer that is not authorized in Pennsylvania may lawfully insure a Pennsylvania risk only when the coverage is placed:

  1. Through a licensed surplus lines producer Correct answer.
  2. Through an unlicensed broker in another state
  3. Through any licensed life insurance producer
  4. Directly by the insured through the mail

Explanation

Unauthorized insurers may write Pennsylvania risks only through licensed surplus lines producers, and only after a good-faith effort shows that authorized insurers declined the risk.

Question 43Pennsylvania Insurance Law, Regulations and Department Notices

A nonresident producer licensed in Pennsylvania is deemed to have appointed which official as agent for service of legal process?

  1. The Attorney General
  2. The Insurance Commissioner Correct answer.
  3. The Secretary of the Commonwealth
  4. The prothonotary of the county where the claim arises

Explanation

By applying for a nonresident license, the producer consents to service of legal process on the Insurance Commissioner, who forwards the documents to the licensee.

Question 44Pennsylvania Insurance Law, Regulations and Department Notices

A producer is asked to sell a Medicare supplement policy to a beneficiary who already has a Medicare supplement policy that is not being replaced. Selling the additional policy is:

  1. Permitted because the beneficiary pays the premium
  2. Prohibited as an unlawful duplicate sale Correct answer.
  3. Permitted during the annual open enrollment period
  4. Permitted if the beneficiary signs a written waiver

Explanation

Pennsylvania prohibits selling a Medicare supplement policy that duplicates coverage the applicant already has. The producer must make reasonable efforts to determine whether existing coverage exists before taking the application.

Question 45Pennsylvania Insurance Law, Regulations and Department Notices

Under Pennsylvania regulations, when a producer takes an application for long-term care insurance, the producer must deliver to the applicant:

  1. A copy of the insurer's annual statement
  2. An outline of coverage with the application Correct answer.
  3. A list of the insurer's participating providers
  4. A signed copy of the policy within 60 days

Explanation

Long-term care insurance solicitations require delivery of an outline of coverage at the time the application is taken, summarizing benefits, exclusions, and premium.

Question 46Pennsylvania Insurance Law, Regulations and Department Notices

A Pennsylvania producer's license lapsed six months ago for failure to renew, but she continues to solicit and submit new applications. Her conduct is:

  1. Permitted for 12 months after expiration
  2. Unlicensed activity subject to penalties Correct answer.
  3. Permitted if the insurer has appointed her
  4. Permitted, because she may service existing clients

Explanation

Once a license lapses, it no longer authorizes any insurance activity, and soliciting or submitting new applications is unlicensed activity subject to penalties. Limited servicing of existing business does not extend to new sales.

Question 47Pennsylvania Insurance Law, Regulations and Department Notices

During an examination, an insurer refuses to produce records the Insurance Department has requested. The Commissioner may:

  1. Suspend or revoke the certificate of authority Correct answer.
  2. Require the insurer to arbitrate the dispute
  3. Take no action because the records are the insurer's own property
  4. Refer the matter to the Guaranty Association

Explanation

Insurers must cooperate with Department examinations and produce records on request. Refusal is a violation of the insurance laws that supports license discipline and monetary penalties.

Question 48Pennsylvania Insurance Law, Regulations and Department Notices

Before recommending an annuity to a consumer, a Pennsylvania producer must:

  1. Recommend only products with the lowest surrender charges
  2. Obtain the Commissioner's prior written approval of the recommendation
  3. Make a reasonable inquiry into the consumer's suitability Correct answer.
  4. Require the consumer to sign a waiver of suitability review

Explanation

Annuity suitability rules require the producer to make reasonable efforts to obtain information about the consumer's financial situation, needs, and objectives, and to have a reasonable basis for the recommendation.

Question 49Pennsylvania Insurance Law, Regulations and Department Notices

To sell variable annuity contracts in Pennsylvania, a producer must hold:

  1. Only a Pennsylvania life producer license
  2. An insurance license plus securities registration Correct answer.
  3. Only a securities representative registration
  4. A surplus lines producer license

Explanation

Variable annuities are both insurance products and securities, so the producer must hold a Pennsylvania insurance license and the appropriate securities registration.

Question 50Pennsylvania Insurance Law, Regulations and Department Notices

A licensed producer allows an unlicensed friend to solicit insurance using the producer's name in exchange for a share of commissions. The producer is subject to:

  1. No action, because the producer is licensed
  2. A private lawsuit by the friend only
  3. License discipline and monetary penalties Correct answer.
  4. A warning only, because no consumer was harmed

Explanation

A producer may not share commissions with, or permit solicitation by, an unlicensed person. Doing so supports suspension or revocation of the license along with monetary penalties.