Free Maine Casualty practice questions

Answer: C. Enabling consumers to learn the reasons for adverse underwriting decisions

The Act's stated purposes are to set standards for collecting, using and disclosing information gathered in insurance transactions, to balance insurers' need for information against the public's interest in fair practices that respect privacy, to let consumers find out what is being collected about them and check its accuracy, to limit how that information is distributed, and to let consumers obtain the reasons for adverse underwriting decisions. Because the Act sets standards for collecting information and weighs insurers' need for it, a total bar on collection contradicts its purposes, and rate approval and insolvency protection appear nowhere in its purpose statement.

Answer: C. 30 days after the insurer received the additional information it had requested

A claim under a Maine policy is generally payable within 30 days after the insurer receives proof of loss and the loss is ascertained, and an undisputed claim left unpaid past that point is overdue. When the insurer tells the insured in writing within those 30 days that it reasonably needs more information, the period runs again from a later point: the undisputed claim is not overdue until 30 days after the insurer receives that information. Measuring from the original proof of loss ignores the written request, and measuring from the date the request was mailed starts the period too early. The 60-day period in the statute applies to a standard fire policy and to coverage insuring against the peril of fire, and this is a collision claim.

Answer: D. The Maine Administrative Procedure Act

Section 230(1) requires notice of a hearing before the superintendent to be given in conformity with the Maine Administrative Procedure Act, found at Title 5, chapter 375. The Rules of Civil Procedure are wrong because the subsection names the administrative procedure statute, not court rules. The NAIC handbook is wrong because the Insurance Code points to NAIC handbooks in connection with examinations, not hearing notice. A bulletin from the Governor is wrong because the subsection ties hearing notice to a statute rather than to any executive bulletin.

Answer: D. A notice, in a form the superintendent prescribes or approves, telling the insured about the rental coverage

Every policy subject to Maine's rental vehicle coverage section must be accompanied or supplemented, at issuance or at the first renewal after January 1, 1992, by a notice in a form the superintendent prescribes or approves, advising the insured of the rental vehicle coverage. The coverage itself is stated as something a qualifying policy must provide, so a form for declining it does not fit the section. The document this subsection names is an informational notice to the insured; a pickup certificate and a schedule of rental companies are not what it describes.

Answer: C. The Superintendent of Insurance, acting in conformity with the Maine Administrative Procedure Act

Sec. 2920 closes by authorizing the superintendent to adopt rules for carrying out the hearing section, acting in conformity with the Maine Administrative Procedure Act. The section places that rulemaking authority with the superintendent; neither the plan's member insurers, the Secretary of State nor individual insurers are given it.

Answer: B. Average weekly wage reduced by the prorated weekly amounts of FICA, state income tax and federal income tax

Maine's Act defines the after-tax average weekly wage as the average weekly wage minus the prorated weekly amounts that would have gone to FICA, state income tax and federal income tax, figured on an annual basis, counting the employee and the employee's dependents as exemptions and without excess itemized deductions. The deductions in the definition are taxes only, so health insurance premiums and retirement contributions are not subtracted. Federal income tax is not the only deduction: state income tax and FICA come out as well. Two-thirds of gross wages is not how the definition works; the definition starts from the average weekly wage and subtracts the listed taxes.

Answer: B. The initial pretrial hearing date

Maine sets the reporting period for a criminal matter at 30 days, and the clock starts at the initial pretrial hearing date. The final disposition of the case is the trigger for the separate duty to report administrative actions, and neither the date of the complaint nor the renewal cycle starts the clock.

Answer: C. The superintendent must enforce the Title and carry out the duties it imposes

Section 211(1) places a mandatory duty on the superintendent to enforce the Insurance Code and to perform the duties the Title assigns to the office. Subsection 1 states that duty without any condition, such as a direction from the Governor or a yearly legislative designation, so both of those choices misstate it. The choice giving enforcement solely to the Attorney General is wrong because the subsection assigns the enforcement duty to the superintendent.

Answer: D. 18 years of age

Before approving a resident producer application, the superintendent must find, among other things, that the applicant has reached 18 years of age. An applicant younger than that falls short of the minimum, and the other ages offered are not the minimum Maine sets.

Answer: A. Within 30 days of receiving the statement of reason

Sec. 2920 gives a named insured who receives a statement of reason for cancellation, or for the insurer's intent not to renew, 30 days from receipt to request a hearing before the Superintendent of Insurance. The hearing right therefore reaches a nonrenewal as well as a cancellation, and the hearing is confined to whether the proof or evidence behind the insurer's stated reason exists, with the insurer bearing the burden of proof. 45 days is the hearing window in the general casualty cancellation statute, which excludes policies subject to the automobile act. 14 days is how long the superintendent may keep a policy in force after ruling for the insurer.