Exam 8: Government Regulation of Insurance

Liability items on an insurer's balance sheet that reflect obligations that must be met in the future are called

Reasons for regulation of insurance include which of the following? I.Maintaining insurer solvency II.Ensuring reasonable rates

Which of the following statements is (are)true regarding taxation of insurance companies? i.Insurance companies are exempt from having to pay state and federal income taxes. ll.The primary purpose of the premium tax is to raise revenues for the state,not to provide funds for insurance regulation.

To correct abuses in the financial services industry,Congress passed an Act in 2010 that included numerous provisions to reform the financial services industry.This Act was the

The right of the states to regulate the business of insurance was first established by

The regulation of insurers in areas that affect consumers,which include claims handling,underwriting,complaints,advertising,sales practices,and other trade practices is called

Under one type of rate regulation,insurers do not have to register their rates with state regulatory authorities.However,insurers may be required to furnish rate schedules and supporting data to state officials.A fundamental assumption underlying this type of rating law is that market forces will determine the price and availability of insurance,rather than discretionary acts of regulators.This type of rate regulation is called

A life insurance company based in Canada was licensed to operate in Massachusetts.When operating in Massachusetts,the Canadian insurer would be considered a(n)

Under one type of rating law,insurers are free to change rates and to use modified rates immediately.However,the new rate must be filed with regulators within a specified period,such as 60 days after the modified rate is employed.This type of rating law is called

The Dodd-Frank Act created a federal body with some limited regulatory authority.For example,the organization can represent the federal government in international negotiations regarding insurance and it can preempt state law where it conflicts with negotiated international agreements.This body is called the

One method of ensuring the solvency of insurers is a periodic review,every three to five years,of insurers that operate on a multistate basis.This review is coordinated by the NAIC.This review is called a(n)

The Federal Insurance Office recommended direct federal involvement in all of the following areas EXCEPT

An emerging concern for insurance companies is the threat of hackers stealing data,taking over their computer system and demanding ransom,and malicious tampering with a computer system.This emerging risk for insurance companies is

Which of the following statements concerning the proposed optional federal charter for life insurers is (are)true? I.Large insurers operating in many states would more likely prefer a state charter while smaller,regional,insurers would more likely choose a federal charter. II.Proponents of the federal charter argue that it would speed the development and approval of new products.

One provision of the Dodd-Frank Act was creation of the Financial Stability Oversight Council.This council is charged with identifying nonbank financial companies that could increase the risk of collapse of the entire financial system.This risk is called

Which of the following statements about the licensing of insurance companies is (are)true? I.A new capital stock insurer must meet minimum capital and surplus requirements,which vary by state and line of insurance. II.The licensing requirements for insurance companies are less stringent than those imposed on most other types of firms.