Free 5-question sample test with instant feedback. See how ready you are.
Question 1
Which government entity has primary authority to regulate insurance in the United States?
Answer: Individual state governments regulate insurance, not the federal government, as established by the McCarran-Ferguson Act of 1945.
Question 2
What is the primary purpose of the McCarran-Ferguson Act of 1945?
Answer: It affirmed that states have the authority to regulate insurance and that federal antitrust laws apply to insurance only to the extent that it is not regulated by state law.
Question 3
What is the role of the State Insurance Commissioner (or Director)?
Answer: The State Insurance Commissioner enforces state insurance laws, licenses agents and insurers, approves policy forms and rates, and protects consumers from unfair practices.
Question 4
What is a Certificate of Authority in the context of insurance regulation?
Answer: A Certificate of Authority is a license issued by a state insurance department that authorizes an insurance company to transact insurance business in that state.
Question 5
What is the difference between an admitted (authorized) insurer and a non-admitted (unauthorized) insurer?
Answer: An admitted insurer is licensed by the state and subject to state regulations, including guaranty fund protection. A non-admitted insurer is not licensed in the state but may write surplus lines coverage for risks that admitted insurers won't cover.