Free Missouri Property practice questions

Answer: D. Damage to the home itself, a habitational structure

Sinkhole coverage under this provision applies only to habitational structures, so damage to the home is within its scope. The coverage does not reach driveways or detached structures that are not habitational, and it excludes both the value of the land and the cost of filling a sinkhole.

Answer: C. Misrepresentation on an application to gain a commission

Mo. Rev. Stat. Sec. 375.936(7) makes it an unfair trade practice to put false or fraudulent statements on, or in connection with, a policy application in order to get a commission, fee, money or other benefit from an insurer, agent, agency, broker or other person. A false roof age entered so the producer earns a commission fits that description. The advertising rule concerns statements placed before the public, not entries on one applicant's paperwork. The age-of-property rule restricts an insurer that refuses, cancels or limits residential coverage because of a home's age; it does not address a producer falsifying an application. The false entries rule concerns knowingly false entries in an insurer's own books, reports or statements, not in an application.

Answer: D. 66 2/3 percent

Section 375.774(2) sets a declining schedule: 100 percent for the calendar year of issuance, 66 2/3 percent for the first calendar year after issuance, and 33 1/3 percent for the second year after issuance, which is the last year the certificate may be carried as an asset. For a 2025 certificate, 2026 is the first calendar year after issuance, so 66 2/3 percent applies. The 100 percent figure belongs to 2025 itself, the 33 1/3 percent figure belongs to 2027, and 50 percent is not on the schedule.

Answer: C. Every two years, falling on the birth date of the producer

Missouri requires a producer license to be renewed biennially, meaning every two years, on the producer's birth date, and the license then stays in effect until the director refuses, revokes or suspends it under the disciplinary section. An annual anniversary renewal, a fixed January 1 renewal date and a three-year cycle each conflict with that every-two-years, birth-date schedule.

Answer: B. No, because she was required to be licensed for that work and was not

Missouri bars a person who must be licensed to sell, solicit or negotiate insurance, but is not licensed, from accepting any commission, brokerage, service fee or other valuable consideration for that activity. Dana did licensable work without a license, so she may not take the payment. Issuance of the policy does not change that, the prohibition contains no exception for a license obtained after the sale, and relabeling the payment as a service fee does not help because service fees fall under the same prohibition.

Answer: A. It is a prohibited rebate, because the inducement is a premium benefit not specified in the contract

Mo. Rev. Stat. Sec. 375.936(9)(a), except as otherwise expressly provided by law, prohibits paying, giving or offering, directly or indirectly, any rebate of premiums or any valuable consideration or inducement not specified in the contract as an inducement to insurance. Paying part of the client's premium to induce the purchase is that kind of inducement. The paragraph draws no line based on where the money comes from, so funding it from the producer's commission makes no difference. Written disclosure to the client is not an exception the paragraph creates, and nothing in the paragraph makes the insurer's knowledge or approval a condition of the prohibition.

Answer: A. The other provisions continue to be treated as fully in force and effect

Section 375.771 contains a severability clause: if any provision of sections 375.771 to 375.779 is found unconstitutional, the remaining provisions are treated as remaining in full force and effect. So the law is not voided as a single unit, its other provisions are not suspended pending reenactment, and the clause gives the director no role in choosing which provisions survive.

Answer: D. Treating pregnancy complications differently from other illnesses under the contract

Subsection 4 of Sec. 375.995 bars denying a contract, or restricting benefits or terms, solely on the basis of sex or marital status, and lists examples. One listed example is treating complications of pregnancy differently from any other illness or sickness covered by the contract. The list also prohibits giving women more restrictive benefit periods than men in the same classification and denying riders to women that are available to men, so offering equal benefit periods or the same riders to both is the opposite of those practices. The subsection excepts a restriction or reduction that results from rate differentials permitted under Missouri insurance law.

Answer: C. The insurers that participate in the FAIR Plan program

Mo. Rev. Stat. Sec. 379.870(2) makes the adoption of, or a substantive change in, pension plans or employee benefit programs subject to the approval of insurers. The subsection assigns that approval to the insurers, not to the director, not to the underwriting committee, whose role under Sec. 379.870(6) is to review submitted risks with the manager, and not to the manager alone.

Answer: A. Advertising design and lead-generation techniques for agencies

Missouri lists the subject matter that each two-year period's courses must include: Missouri law, products offered in any line the producer is qualified in, the producer's duties and obligations to the department, and business ethics, with sales suitability named expressly. Advertising design and lead generation do not appear on that list, so that is the topic the statute does not require.