41 terms

New York Accident & Health Insurance

Chapter 20
Agent Licesne
Noone can sell insurance without license but you dont need to pass test if you are employees of licesed insurance agent wh do nt solicit, licensed attorneys, actuaries or cpas who provid ino, regular salaried implyees who devote little tie, an agent oof a graternal benefit society
- must be 18, pass 540 hr course
- pass state exam
- Application must be submiteed w in 2 years
- renewal every 2 years on birthday
Certificate of appointment
if a license is granted to an corporation, , only the officers and directors named on the license can act as agents, but they can sub license agents. Every time a new agent comes on boad, they need a certificate of appointment from the state
License Term for Agent
2 years; can be suspended or revoked by superintendent, terminated by insurer, fails to file a renewal application, it can be terminated;
Must be able to be furnished on request, the head agent must display in the office; if no certificate of appointment is filed, the license is inactive
Allows a person with a license to charge a fee for providing advice
- if given to an indivual, it experires every 2 yrs on the birthday
- if issued to a business entity, it expires on March 31st for life insurance in an odd yyear and general insurance in an even year
- can only recieve a fee if there's a written contract with the person they are providing advice
Adjuster License
acts on behalf of th insurer to investigata and sjust claims arising under insurance contracts issued by the insurer
Non Resident
an individual who is a non resident of NY and who is licensed or authorized to act as an insurance agent in the state in which he resides. If a licenced non residnent moves to NY, he has 90 days to apply for his license w/o taking exam
Temporary License
Can be issued to spouse of deceased or next of kim from a disability
Tremination of License
Can be done by superintendent for:
-providing incorrect or misleading materially untreu info in licesne app
-violating any insurance laws
- stealing money
- having been convicted of a felony
- any dihonest practices
- Have a producer or life settlement license denied or revoked in any other state
- Forging
- Failing to comply with child support payments
To terminate a license, a superintendent must
provide a written notice to the licensee of a hearing before the license an be suspended. For a broker, its not less than 10 days after notice is provided for the hearing. If there's an action against the producer, he must notify the super within 30 days. You cant go into another state and start practicing either
Appointment and Termination of Appointment
All insureres myst file a ciertificate of appointment in order to appoint insurance agents. Then you have 15 days to appoint a producer from the date the agency contract is executed. If you've been fired, you have 30 days to tell the super why you were fired and then the super has 15 days to send the info back to you confirming it,
Change of Address time frame
a licensee has 30 days to inform dept of insurance
Reporting of Action
must report to dept of insurance w in 30 days of any administrative action
Continuing Ed
must to 15 hrs every 2 years
Powers of the Superintendent
he has the power to promote the public welfare and administer and enforce all laws
appointed by the governor
Not responsible for assessing punitive damages to thos who break insurance laws. (this is the responsibility of the state legislative bodies
- Can suspend, revoke or non renew the liceses but only after a hearing
- Examine and regulate an inusrance co for solvency and examine the books
-issue insurance licenses
- regulate and approve life and health insurance rates
- direct insurance department hearings based on grievances from sonsumers or consumer rights organizations
- if the super thinkgs that a hearing is necessary, he has to give 10 days written notice of hearing to the licensee
- regulate all advertising
- determine reserve amounts
- issue a cease and desist order - if there's a violation of stat law, can also fine up to 5k for every violation
- report illegalities to the attorney general who will prosecute
- conduct hearings; failure to appear is a misdemeanor
Defined Violation
performing an act prohibited by NY Statutes
Determined Violation
a violation that's been determined after hearing
ie kickbacks, or incentives or consideratin for business. Cant give anything worth more than $15.
Any violation is subject to $500 penalty
Cant do it. cant do aids test without consent. Cant perform any tests without telling the person what they are for.
comparing 1 policy with another to induce that person to switch policies.
Penalties / Fines
a violation is a misdeamenor and carries a $500 fine. Failure to pay within 20 days could result in license suspension.
- 50k fine if you knowingly with the intent to deceive make any flase material statements or reports
- if the insurer's solvency is is put at risk because of false statements, the person could go to jail for 15 years
must contiain the name of the insurance company
Fiduciary Responsibilities
Agen cannot comingle funds with their own bank account but the can establish a separate bank account to collect premiums, pay refunds, funds to advance premiums on behalf of policy owners. Must remit premium payments to the insurance company immediately
sharing commissions
Cannot to it unless it is a licensed agent of that insurer. Cannot pay for stuff unless its been kept for 3 years.
Defamation of insurer
anyone engaged in defamation is guilty of a misdemeanor punishable by a fine of not more than 1k, a year of prison or both,
Complaint records
must be kept for 3 years
Contolled Business
An agent can write their own policies and get a commission but hte cant do it if its more than 10% of overall commission fees
Insurance Fraud Prevention
Anyone who is undergoing fraud shall pay a penalty to exceeding 5k.
Producer Compensation Transparency
Producer has to disclose in writing or orally not later than appolicataion for the insurance contract whether the unsurance prodcuer represents the purchaser or the insurer for purposes of the sale, the the producer will get compensation from the selling insurer based on the insurance contract
Juvenile Insurance
provides minimum insurance to aged 14.5 or above. Limit is greater of 10k or 50% of the amount of life insurance in force upon the life of the applicant.
Under 14.5, its 5k or 25% of amount in force upon the life of the applicant
Annuity Contract provision
- grace period of 31 days
- incontestable after 2 years
- the contract with the applcation shall constitute the entire contract
- if the age of sex is mistated, th amount paybale or benefit accruing will be adjusted
- the insurer shall ascertain and apportion any divisible surpluss accruing on the contract
- if any contract or certificate requiring payments to be made to the insurer that at any time w in 3 years from the date of default, the contract shall be reinstated and the insurer will apy all overdue payments
- annuity contracts musts include provisions providing for non forfeiture benefits and cash surrender
What has to be included when a life insurance policy is delivered
the prospective purchaser needs a copy of a
- buyers guide
- policy summary
- policy cost comparison
- name and address of insurance agent
- full name of insurer
- initial amount of insurance and annual premium
- guaranteed cash surrender values
if applicatble the effective policy loan annual percentage interest rate
- if applicatble , life insurance cost indexes and the level annual dividend for the basic policy for 10 and 20 years
Buyers guide
must be given to applicant at or prior to the time an application is taken.
All ads must state the insurance co's name and the city town or village where it maintains its principal office in the us.
- an insurer may not advertise its financial condition without stating its assets, liabilities, suprlus and legal reserves
- coannot inclue the fact that the life insurance company guaranty corp will protect a consumers interest in a life insurance policy
- can not guarantee that a dividend is guaranteed
Insurance compay guaranty corp
- covers individual and group life policies indiviaul annuities and individual and group health policies for up to 500k for each policy holder or beneficiary
Accellerated Death benefits can effect
whether you get public assistance program help
- information about the effects on the policy of accellerated death benefits must be shown to the policy holder
Life settlment
the sale transfer assignment or bequest of the death benefit or ownership of a life insurance policy by the owner where an insured does not have a catastrophic or life threatening illness (different than a viatical settlement)
- cannot be used as collateral for a loan
Life Settlement provider
any individual, corporation, partnership or firm who pays a sum to the owner of a life insurane contract in return for the ownership of the contract
- must have a license
- can be brokered (but you need a license to broker too)
Life Settlement info that must be provided to potential seller are
- there are alternatives to ife settlement contracts incuding accelerated death benefits
- some of the proveeds of a life settlement my be taxable
- procceds from a life settlement could be subjet to the claims of creditors
- proceeds could affect elegibility for public assistance
- the owner has a right to rescind the contract util 15 days after recept of the life settlement proceeds by the owner
- proceeds must be sent w in 3 days of the settlement provider getting all the signed paperwork
- other parts of the life contract may be forfeited (ie accelerated benefits)
- settlement provider is required to provide a consumer info booklet
- the seller may get called to make sure he's still alive
Timothy's Law
every group or individua policy issued in Y that includes inpatient medical expense care whether issued by an insurer, hmo, home service corp, helath service forp or small plan must include biologically based mental illness covererage (ie biological disorder of the brain) for no less than 30 days of active treatment per calendar year.
Mammography screening
Every policy that covers hospital surgical or medical care must provide coverage for ammography screening for breast cancer
long Term Plan insurance plans must have:
- a residential health care facility beneift (ie daily benefit for custodial care
- a home health care benefit including personal care, 24 hr skilled nursing care and respite care services
- coverage for at least 24 months
- arrangements for managed care including re-assessment and referral programs, utilization controls and approved providers