Free Massachusetts insurance law practice questions

Correct answer: C. Before he begins using the assumed name

• A. Incorrect. 162P requires notice before the name is used, not after.
• B. Incorrect. Waiting until renewal would mean using the name before giving notice, which 162P does not allow.
• C. Correct. 162P requires a producer doing business under any name other than his legal name to notify the commissioner prior to using the assumed name.
• D. Incorrect. 162P does not set a post-registration window; notice must come before the name is used.

An insurance producer doing business under any name other than the producer's legal name is required to notify the commissioner prior to using the assumed name.

Correct answer: A. 15 days

• A. Correct. 162S(b) requires the appointing insurer to file a notice of appointment within 15 days.
• B. Incorrect. 30 days is the commissioner's maximum time to verify eligibility under 162S(c), not the insurer's filing deadline.
• C. Incorrect. 162S(b) allows 15 days, not 10.
• D. Incorrect. 162S(b) allows 15 days, not 45.

(b) To appoint a producer as its agent, the appointing insurer shall file, in a format approved by the commissioner, a notice of appointment within 15 days from the date the agency contract is executed or the first insurance application is submitted. [...] (c) Upon receipt of the notice of appointment, the commissioner shall verify within a reasonable time not to exceed 30 days that the insurance producer is eligible for appointment.

Correct answer: C. The company's president or a vice-president

• A. Incorrect. 175:33 names the president or a vice-president, not the treasurer.
• B. Incorrect. 175:33 does not name the actuary; it requires the president or a vice-president.
• C. Correct. 175:33 requires signature by the secretary (or an assistant or temporary secretary) and by the president or a vice-president, or in their absence by two directors.
• D. Incorrect. 175:33 allows an authorized agent to sign only certain riders or endorsements on other kinds of policies, not the policy itself in place of the president or a vice-president.

All such policies or contracts issued by such company shall be signed by its secretary or an assistant secretary, or in their absence by a temporary secretary, and by its president or a vice-president, or in their absence by two directors. [...] Riders or endorsements attached to any other policy or contract of insurance need not be signed by any officer of the company if signed by a duly authorized agent or representative of the company;

Correct answer: C. Revoke the license at once, with no hearing

• A. Incorrect. 174 calls for revocation without a hearing; thirty days is the clerk's time to file amendments to the articles of organization.
• B. Incorrect. 174 requires the license to be revoked, not reissued to an officer.
• C. Correct. 174 states that upon receipt of the notice of dissolution, the commissioner shall forthwith revoke the corporation's license without a hearing.
• D. Incorrect. 174 requires revocation, not a suspension.

The licenses described in sections 162M, 162N, one hundred and sixty-eight and one hundred and seventy-two may, upon payment of the fees prescribed by section fourteen, be issued to any corporation. [...] The clerk or other corresponding officer shall file with the commissioner, within thirty days after the adoption thereof, certified copies of all amendments to the articles of organization and shall at once notify the commissioner in writing in case of the dissolution of the corporation. Upon receipt of such notice, the commissioner shall forthwith revoke its license without a hearing.

Correct answer: A. The officer, even though acting for the corporation

• A. Correct. 174 makes every officer or director specified in the license personally liable to the penalties of the insurance laws even when the violation is done in the name and on behalf of the corporation.
• B. Incorrect. The corporation is liable for a violation whose responsibility cannot be placed on any individual officer or director; here the named officer is personally liable.
• C. Incorrect. 174 places personal liability on the officer or director specified in the license who committed the violation.
• D. Incorrect. Liability under 174 does not depend on dissolution of the corporation.

Every officer or director specified in the license shall be personally liable to the penalties of the insurance laws for any violation thereof, although the act of violation is done in the name and in behalf of the corporation. The corporation shall be liable for any such violation, the responsibility for which cannot be placed on any individual officer or director.

Correct answer: B. Costs plus reasonable attorney's fees for whichever side wins

• A. Incorrect. Section 20(c) allows costs and fees to the prevailing party, which could be the insurer.
• B. Correct. Section 20(c) lets the court award the cost of the action and reasonable attorney's fees to the prevailing party, whichever side that is.
• C. Incorrect. Section 20(c) concerns the cost of the action and reasonable attorney's fees, not tripled damages or fines.
• D. Incorrect. Section 20(c) expressly allows the cost of the action and reasonable attorney's fees.

(a) If any insurance institution, insurance representative or insurance-support organization fails to comply with sections eight, nine or ten with respect to the rights granted under said sections, any person whose rights are violated may apply to the superior court, or any other court of competent jurisdiction, for appropriate equitable relief. [...] (c) In any action brought pursuant to this section, the court may award the cost of the action and reasonable attorney's fees to the prevailing party.

Correct answer: C. 2-to-1

• A. Incorrect. The limit in s. 3(a)(2) is 2-to-1.
• B. Incorrect. The limit in s. 3(a)(2) is 2-to-1.
• C. Correct. Section 3(a)(2) states the ratio shall not exceed 2-to-1.
• D. Incorrect. The limit in s. 3(a)(2) is 2-to-1.

The commissioner shall annually file with the United States Department of Health and Human Services to establish a standard age rate adjustment factor table so that the ratio of the highest factor for adults over age 20 compared to the lowest factor for adults over age 20 shall not exceed a ratio of 2-to-1.

Correct answer: A. Unfair, as it is an untrue statement about the business

• A. Correct. Clause (2) covers advertisements over any radio or television station, or in any other way, with untrue, deceptive or misleading statements about the business of insurance or a person's insurance business.
• B. Incorrect. Clause (2) expressly includes radio and television and any other way.
• C. Incorrect. Clause (2) reaches statements with respect to any person in the conduct of his insurance business.
• D. Incorrect. Clause (2) has no correction period.

The following are hereby defined as unfair methods of competition and unfair or deceptive acts or practices in the business of insurance: [...] (2) False information and advertising generally: making, publishing, disseminating, circulating, or placing before the public, or causing, directly or indirectly, to be made, published, disseminated, circulated, or placed before the public, in newspaper, magazine or other publication, or in the form of a notice, circular, pamphlet, letter or poster or over any radio or television station, or in any other way, an advertisement, announcement or statement containing any assertion, representation or statement with respect to the business of insurance or with respect to any person in the conduct of his insurance business, which is untrue, deceptive or misleading.

Correct answer: B. No later than when the application is taken

• A. Incorrect. The notice is a point-of-sale document; it cannot wait until after delivery.
• B. Correct. The agent must present the notice not later than at the time of taking the application.
• C. Incorrect. The deadline is tied to taking the application, not to the insurer's notice to the existing insurer.
• D. Incorrect. The 20-day period in 211 CMR 34.06 concerns the existing insurer's policy summary, not the agent's replacement notice.

Where a replacement is involved, the agent or broker shall: [...] (a) present to the applicant, not later than at the time of taking the application, a notice regarding replacement in the following form or other substantially similar form approved by the insurance commissioner.

Correct answer: B. A term policy

• A. Incorrect. Whole life is among the customary forms the employee may choose.
• B. Correct. The converted policy may be in any form customarily issued by the company, except a term policy.
• C. Incorrect. A limited-payment life policy is not the excepted form.
• D. Incorrect. An endowment policy is not the excepted form.

together with a provision to the effect that if his insurance, or any portion of it, ceases because of (1) termination of employment [...] the employee shall continue to be insured thereafter for a period of thirty-one days, for the amount of life insurance which he is entitled to have issued to him under an individual policy in accordance with the provisions which follow; and that he shall be entitled to have issued to him by the company, without evidence of insurability, upon written application in a form satisfactory to the company and upon the payment of the premium applicable to the class of risk to which he belongs and to the form and amount of the policy at his then attained age, both within said period of thirty-one days, an individual policy of life insurance without disability or other supplementary benefits, effective at the expiration of said period, in any one of the forms of life policies then customarily issued by the company, except a term policy

Correct answer: A. Accelerated benefit

• A. Correct. 55.06(2)(c) requires the term "accelerated benefit" to be included in the description.
• B. Incorrect. 55.06(2)(c) does not require this term.
• C. Incorrect. 55.06(2)(c) bars the term "long-term care insurance" from being used in describing or marketing accelerated benefit products.
• D. Incorrect. 55.06(2)(c) does not require this term.

The term "accelerated benefit" shall be included in the description, and the term "long-term care insurance" may not be used in describing or marketing accelerated benefit products

Correct answer: C. No, a genetic test cannot be a condition of issuance

• A. Incorrect. Paying for the test does not make the requirement lawful under s. 120E.
• B. Incorrect. Section 120E bars requiring the test as a condition of issuance; written consent does not create an exception.
• C. Correct. No insurer, agent or broker may require an applicant to undergo a genetic test as a condition of the issuance or renewal of a life policy.
• D. Incorrect. Section 120E has no commissioner-approval exception.

No insurer, agent or broker authorized to issue policies on the lives of persons in the commonwealth shall require an applicant to undergo a genetic test as a condition of the issuance or renewal of a policy on the lives of persons in the commonwealth. Any violation of this section shall constitute an unfair method of competition or unfair or deceptive act or practice in violation of chapters 93A and 176D.

Correct answer: C. With the policy or before the policy is delivered

• A. Incorrect. That is the general rule, but the ten-day refund provision allows later delivery with the policy.
• B. Incorrect. The rule allows delivery with or before the policy, not after it.
• C. Correct. When the policy has an unconditional refund provision of at least ten days, the Buyer's Guide may be delivered with the policy or before delivery.
• D. Incorrect. The insurer must provide the Buyer's Guide to all prospective purchasers; it is not a request-only item.

(1) Requirements Applicable Generally. (a) The insurer shall provide a Buyer's Guide to all prospective purchasers prior to accepting the applicant's initial premium or premium deposit. However, if the policy for which application is made contains an unconditional refund provision of at least ten days, the Buyer's Guide may be delivered with the policy or prior to delivery of the policy.

Correct answer: D. No, the carrier is not required to waive them

• A. Incorrect. Automatic waiver applies when the full death benefit is accelerated, under (8)(a).
• B. Incorrect. The rule does not split premiums between the accelerated and remaining amounts.
• C. Incorrect. The method or timing of payment does not create a waiver duty when less than the full benefit is accelerated.
• D. Correct. When less than the full death benefit is accelerated, carriers are not required to waive future premiums on the remaining coverage unless the policy already has an applicable waiver of premium provision.

(8) Waiver of Premium in Accelerated Benefit Products. (a) If a policyholder elects to accelerate the full amount of the death benefit, whether as a lump sum or in periodic payments, future premium payments on the underlying life insurance policy shall be waived, without the inclusion of a waiver of premium rider. (b) If a policyholder accelerates any amount less than the full amount of the death benefit, whether as a lump sum or in periodic payments, carriers are not required to waive future premium payments on the remaining in-force life insurance policy unless the policy already contains a waiver of premium provision that applies.

Correct answer: B. 60 days

• A. Incorrect. The waiting period is sixty days, not 30.
• B. Correct. No action may be brought before sixty days after written proof of loss has been furnished.
• C. Incorrect. Ninety days is the proof of loss deadline in another provision, not the legal action waiting period.
• D. Incorrect. The waiting period is sixty days, not 120.

No action at law or in equity shall be brought to recover on this policy prior to the expiration of sixty days after written proof of loss has been furnished in accordance with the requirements of this policy. No such action shall be brought after the expiration of three years after the time written proof of loss is required to be furnished.

Correct answer: B. Yes, since notice need not be in writing

• A. Incorrect. 110(G) defines notice of a claim as any notification whether in writing or otherwise.
• B. Correct. Under 110(G), notice of a claim is any notification, in writing or otherwise, to the insurer or its authorized agent that reasonably apprises the insurer of a claim.
• C. Incorrect. Notice to the insurer's authorized agent counts under 110(G).
• D. Incorrect. The definition does not require a claim form; any notification that reasonably apprises the insurer of the claim is enough.

For purposes of this section the term ''notice of a claim'' shall mean any notification whether in writing or otherwise, to an insurer or its authorized agent, by any person, firm, association, or corporation asserting right to payment under a policy of insurance which reasonably apprises the insurer of the existence of a claim.

Correct answer: B. The policy may not pay all medical expenses

• A. Incorrect. That is not the wording 71.16(1)(c) requires on the first page.
• B. Correct. The required notice reads: "Notice to Buyer: This Policy may not cover all of your medical expenses."
• C. Incorrect. 71.16(1)(c) does not require a premium-change notice.
• D. Incorrect. 71.16(1)(c) does not require a drug-plan notice.

Every Issuer or other entity marketing Medicare Supplement Insurance in Massachusetts directly or through its producers, shall establish marketing procedures: [...] to ensure that Insureds are informed that the Policy they are purchasing does not cover all of the costs associated with medical care incurred by the Insureds by displaying the following prominently by type, stamp or other appropriate means on the first page of the Policy: "Notice to Buyer: This Policy may not cover all of your medical expenses."

Correct answer: A. Yes, the insurer may omit it at its option

• A. Correct. The statute states that the first clause of provision (12), on irrevocable designation of beneficiary, may be omitted at the insurer's option.
• B. Incorrect. Omission is at the insurer's option; insured consent is not the condition.
• C. Incorrect. The statute expressly allows the first clause to be omitted.
• D. Incorrect. The statute leaves this to the insurer's option without a separate approval step.

Unless the insured makes an irrevocable designation of beneficiary, the right to change of beneficiary is reserved to the insured and the consent of the beneficiary or beneficiaries shall not be requisite to surrender or assignment of this policy or to any change of beneficiary or beneficiaries, or to any other changes in this policy. [...] The first clause of provision (12), relating to the irrevocable designation of beneficiary, may be omitted at the insurer's option.

Correct answer: A. Yes, a separate percentage for them is allowed

• A. Correct. Notwithstanding the equal-contribution rule, a carrier may enter into a policy with an employer that sets separate contribution percentages for employees covered by collective bargaining agreements.
• B. Incorrect. Section 110(O) expressly allows separate contribution percentages for employees covered by collective bargaining agreements.
• C. Incorrect. The collective bargaining exception does not depend on salary levels.
• D. Incorrect. Section 110(O) does not require commissioner approval of each percentage.

provided, however, the employer shall not make a smaller health insurance premium contribution percentage amount to an employee than the employer makes to any other employee who receives an equal or greater total hourly or annual salary for each specific or general blanket policy of insurance for all employees. Notwithstanding the foregoing, a carrier may enter into a general or blanket policy of insurance with an employer that establishes separate contribution percentages for employees covered by collective bargaining agreements.

Correct answer: B. Six months

• A. Incorrect. The limit is six months, not three.
• B. Correct. 65.05(3)(a)2. says pre-existing condition limitations may not apply for more than a six-month period from the policy's effective date.
• C. Incorrect. Twelve months exceeds the six-month limit.
• D. Incorrect. Twenty-four months exceeds the six-month limit.

Limitations and Exclusions. [...] Pre-existing condition limitations may not apply for more than a six-month period from the effective date of the policy.