Hawaii Insurance Common Law – Key Exam Points

Question-and-answer flashcards summarizing Hawaii’s common-law insurance regulations, licensing rules, unfair practices, claims requirements, and Commissioner powers for exam preparation.

As an insurance producer primarily represent in Hawaii?

The insurers

All are duties of the commissioner, except:

Examine insureds

Domestic insurers must me audited (examined) by the commissioner

At least once every 3 years

All of the following are requirements for obtaining a resident producer’s license except

Completion of pre-license training.

In authorizing an insurer to transact business in Hawaii, the Commissioner is

Allowing that company to legally do business in this state.

The insurer must notify the commissioner of a producer’s appointment within __ days of receiving their first application

15 days

To obtain a Hawaii producer’s license as a nonresident you must

Holding a similar active license in their home state

A producer who is found guilty of a single unintentional violation of Unfair Trade Practice Regulations may be fined up to:

$1,000

All of the following are considered to be missues of Trustee funds except

Collecting interest on customer balances helped in a producer’s trust account, with their permission

Which of thee following would be considered to be a rebate

Offering to give part of the commission to a customer as an inducement to buy.

Of $100,000 in premiums producer Smith wrote over the past year, $60,000 came from sales to Smith’s family members. This is

A violation of the “controlled” business regulations

Which of the following would not be considered an Unfair Claims Settlement Practice:

Refusing to pay a claim after conducting a proper investigation

Insurers must respond to claim communications

Within 15 working days

If a producer or insurer is found to have violated an insurance law, the Commisioner may do all of the following except:

Impose jail time

Which of the following is considered to be rebating?

Offering Super bowl tickets as an inducement to sale.

All are true regarding producer appointments except:

A producer must be appointed at the time business is placed with an insurer.

All are true regarding a producer’s license except:

A producer may continue to sell for up to 12 months on an expired license.

Which insurer type may pay dividends to policyholders: stock or mutual?

Mutual insurer

No foreign insurer shall transact insurance in this state without a

A Certificate of Authority

If after hearing the Commisioner finds that an insurer knew or reasonably should have known they were in violation of Unfair Trade Practices Regulations, he may issue a Cease and Desist order and impose a maximum total fine of

$50,000

An example of Defamation, which is an Unfair Trade Practice, is:

Misstating the financial condition of an insurer or producer.

All are true about “foreign” insurance companies EXCEPT:

They do not need a Certificate Authority in Hawaii

All are true about the State Guaranty Association EXCEPT:

It covers title and ocean marine insurance.

To which of the following could a producer pay part of her commission without violating any insurance regulations

A partnership of which the producer is a member

Which of the following is not one of the duties of the Commisioner

Making rates.

Which type of government is primarily concerned with regulating insurance.

State

Which of the following correctly defines an “alien” insurer doing business in Hawaii.

One formed under the laws of another country, but holding a Certificate of Authority in Hawaii.

A producer who procures a license for the principal purpose of obtaining insurance for herself her family members or employees is violating the regulations concerning.

Controlled business.

Which is not prohibited under Unfair Trade Practice Regulations:

Readjusting group premiums based on loss or expense experience

How many principals may a producer represent

Unlimited

Conditions for a corporate insurance agency seeking a Hawaii producer’s license include

All agency principals selling insurance to have an individual license.

All of the following are true regarding a producer’s license except.

It is issued for 1 year.

You represent a large California based insurer who does business in all 50 States. all of the following are true except:

You must obtain a producer’s license in all 50 States.

After a hearing, the Commisioner may lovey all of the following penalties on a producer who violated an Unfair Trade Regulation EXCEPT:

6 months in jail

An insurer that is domiciled in another state may do business in Hawaii if:

They obtain a Certificate of Authority in Hawaii

The purpose of insurance regulation is to

Protect the insurance buying public.

Which of the following is a producer Trustee duty

Handling premiums.

All of the following are violations of Hawaii insurance law EXCEPT:

Selling insurance with a nonresident license.

All of the following are penalties that the Comissioner may levy when a producer fails to report a change of address within 30 days EXCEPT:

Fine of up to $15,000.

Clark’s credit union refused his application for a loan unless he agreed to purchase credit life from them. This is an example of:

Coercion.

You need a producer’s license to sell all EXCEPT:

Pre-Paid Legal Insurance

All of the following can void a policy written by an authorized insurer except

The insurer

A producer’s statement that the policy they are selling is similar to shares of stock is;

Misrepresentation

Under Hawaii’s Unfair Claims Practice regulations, when denying a claim an insurer must do all of the following EXCEPT.

Pay a claim that occurs after the grace period has ended.

Under Hawaii’s Unfair Claims Practice Regulations, all would be considered violations EXCEPT

Requiring claimants to submit proof of loss.

If a producer writes a policy with an authorized insurer who refuses to pay a covered claim, the producer must pay __% of the claim

100%

The Commissioner may examine (audit) an authorized insurer:

Whenever prudent to enforce the insurance code.

A client may challenge the validity of a consumer investigative report under the:

Fair Credit Reporting Act

All of the following are included in the premium EXCEPT:

General Excise Tax

All are true about temporary licenses EXCEPT:

They may be issued to new producers whle tney are in training

An insurer or producer may not compensate a(n):

Unlicensed producer

A marketing program that relies on threats, fear or intimidation is known as.

High pressure sales tactic

All of the following are true regarding a producer's records EXCEPT:

The Commissioner must pay all costs related to an examination

AThe Commissioner must pay all costs related to an examination

A

A producer with a L&H or a P&C license must eam _ hours of CE every 2 years, 3 of which must be related to HI law:

20

Types of insurers that may be formed in this state include which of the following:

Stock, mutual and reciprocal

Which of the following is considered to be an Unfair Claims Settlement Practice:

Misrepresenting policy provisions

A California based insurer cannot pay a commission to a Hawaii producer unless the producer is licensed:

In Hawaii

A producer's license may be suspended or revoked for all of the following EXCEPT:

Conviction of a misdemeanor

Mr R. is a corporate officer who works at the insurer’s home office. If he does not sell insurance and does not receive commissions:

He does not need a producers license.

All of the following are duties of a producer EXCEPT:

Modifying insurance contracts.