Free Illinois Property practice questions

Answer: C. Once every three years

Section 817.1 directs the Director to review the Fund's rates once every three years. Annual, two-year and five-year intervals are not the interval the section sets.

Answer: B. Only if made with actual intent to deceive, or if it materially affects acceptance of the risk or hazard.

Under Section 154, a misrepresentation or false warranty by the insured does not defeat a policy unless it was made with actual intent to deceive or it materially affects either the insurer's acceptance of the risk or the hazard the company assumed. The test is intent or materiality, in the alternative, so a statement that is merely inaccurate, made innocently and about an immaterial fact, does not defeat the policy. The section does not require that the misstated fact contributed to a loss, and it does not require a criminal conviction.

Answer: A. That Illinois law requires vehicle repairers to be licensed

Section 154.6 lists acts that, when committed without just cause and in violation of Section 154.5, are improper claims practices. Paragraph (q) is failing, as a persistent tendency, to include on any written estimate the insurer prepares for an insured loss a notification that Illinois law requires vehicle repairers to be licensed under Section 5-301 of the Illinois Vehicle Code. Shop choice, Director review of estimates and the type of parts used are not the subject of paragraph (q).

Answer: A. A separate policy, or an endorsement to the fire and extended coverage policy

Section 155.31(b) allows an insurer to cover a licensed early care and education home, including a licensed group home of that type, either through a separate policy or by endorsing the fire and extended coverage policy. The Section offers both routes, so a choice allowing only one form misstates it. Nothing in the Section requires a different insurer, individual approval of the endorsement by the Director, or moving the operation off the insured premises.

Answer: D. The Director may exempt them upon the Fund's request

Section 807.1 makes exemption mandatory only for property in a county of 1,000,000 or more inhabitants or a county contiguous to one. For any other specified county, the Director may exempt policies upon the Fund's request, which is a discretionary power rather than a duty. Exemption for such a county is not automatic, and the section gives insurers no power to exempt a county themselves.

Answer: D. File a change of address and certification from the new resident state within 30 days

Section 500-40(c) applies when a resident producer relocates from Illinois to another state, or a nonresident producer relocates between states. Within 30 days after the change of legal residence, the producer must submit an address change to the Director along with certification issued by the new home state. The same subsection states that no license application is required, which rules out surrendering the license and reapplying. The duty is placed on the producer, not on appointing insurers, and the subsection imposes no re-examination.

Answer: D. Taking part in a training course or program run by or for the insurance company appointing her.

Section 500-65(a) requires the applicant, during the 90 days, to be enrolled in training conducted by the appointing insurer or on its behalf, while she works through the pre-licensing requirements of Sections 500-25 and 500-30. A sponsor who assumes responsibility for the licensee's acts is something the Director may require under Section 500-60, a different temporary license used to service a business after a producer's death, disability or military service; Section 500-65 does not impose it. Limits to servicing existing policies or to personal lines appear nowhere in Section 500-65(a).

Answer: C. Accident and health insurance within those classes

Section 141.02(1) limits the Section to contracts between an independent insurance agent and a company authorized in Illinois to write the kinds of business in Class 2 or Class 3 of Section 4, and then carves out accident and health insurance. The other three choices describe features that bring a contract inside the Section rather than take it out: the Section defines an independent insurance agent as one representing a company as an independent contractor rather than an employee, and as one not contractually obligated to place accounts with any company or group, and it applies to companies authorized in this State.

Answer: B. $5,000

Section 401.1(6)(a) allows a forfeiture of up to $100 for each day a violation of a final order continues, but in no event more than $5,000 in total. Accruing the daily amount over 120 days would reach $12,000, so the cap, not the daily rate, sets the limit here. The $10,000 figure also exceeds the cap, and $2,000 is less than the largest total the section permits for a violation of this length.

Answer: A. Up to $1,000 per violation, recoverable in a civil action

Section 431 sets the forfeiture for violating a final, in-effect cease and desist order issued under Section 427, or a Circuit Court order under Section 429, at a sum not exceeding $1,000 for each violation, payable to the State of Illinois and recoverable in a civil action. Because the cap applies to each violation, it is not a single $1,000 ceiling for all violations combined. The figure the section uses is $1,000, not $10,000 or $100, and it describes recovery through a civil action rather than a criminal fine.