Free Rhode Island Property practice questions

Answer: C. Yes, because a listed act done flagrantly and in conscious disregard of the chapter suffices by itself

Rhode Island makes it an improper claims practice for a domestic, foreign or alien insurer transacting business in the state to commit an act defined in Sec. 27-9.1-4 if the act is committed flagrantly and in conscious disregard of the chapter or its rules, or if it is committed often enough to indicate a general business practice. The two tests are joined by 'or', so flagrant conduct qualifies without any pattern. That defeats both choices that demand frequency. The domestic-only choice is wrong because the statute names foreign and alien insurers as well.

Answer: A. Proof of mailing together with a copy of the template

Under 230-RICR-20-60-4, Sec. 4.9(A), letters generated from a template and an electronic mail list are treated as sufficiently reproduced when the insurer can show proof of mailing and a copy of the template. The rule does not ask for a stored image of each letter, an acknowledgment signed by each insured, or a certification filed with the Department to satisfy this requirement.

Answer: D. Payment is barred, because Jordan solicited insurance without a required license

An insurer or a producer may not pay a commission, service fee, brokerage or other valuable consideration to someone for selling, soliciting or negotiating insurance in Rhode Island if that person must be licensed and is not. Jordan solicited insurance without a required license, so the producer may not share the commission. The prohibition reaches producers as well as insurers, covers any valuable consideration rather than only payments labeled commissions, and sets no percentage below which a share is allowed.

Answer: C. Commercial property insurance

Under 230-RICR-20-05-14, Sec. 14.2, the regulation applies to renewals of personal lines auto insurance, homeowners insurance and residential fire insurance, or any components of them. Personal auto, homeowners and residential fire are each named in that list. Commercial property insurance is not among the listed lines.

Answer: D. An individual who bought a homeowners policy for the house she lives in

Sec. 7.2(B)(1) applies the rule to nonpublic personal financial information about individuals who obtain products or services primarily for personal, family or household purposes from licensees. It excludes information about companies, and about individuals buying for business, commercial or agricultural purposes. A homeowners policy on the buyer's own home is a personal and household purchase. The corporation is a company, and the farmer and the sole proprietor bought coverage for agricultural and business purposes, so their financial information falls outside this part of the rule's scope.

Answer: B. The effective and expiration dates of the coverage

Rhode Island's binder statute defines an insurance binder as a written, temporary contract authorized by the insurer and issued before the policy, and it lists what the binder includes: the insured's name and address (plus any additional named insureds, mortgagees or lienholders), a description of the insured property, the nature and amount of coverage, the insurer and the representative who executed the binder, the dates coverage begins and ends, and the binder number or, for a policy extension, the policy number. A premium and commission figure, a five-year loss history and a signed receipt for the policy are not among the listed items.

Answer: B. No later than three days after receiving that notice

R.I. Gen. Laws Sec. 27-34-10(a)(1) requires the commissioner to notify the association that an insolvent insurer exists no later than three days after the commissioner receives notice of the insolvency determination. The same subdivision also entitles the association to a copy of a complaint seeking a liquidation order with a finding of insolvency against a member company when that complaint is filed in court. Thirty days and ten business days are wrong because the deadline is three days. Waiting for a final liquidation order is wrong because the three-day period runs from the commissioner's receipt of notice of the insolvency determination.

Answer: A. Decline coverage based on the application, with no inspection required

Where immediate coverage is not requested, the Association may inspect a property before it accepts or declines, but the regulation also allows it to decline without inspecting when the application on its face shows the property or applicant falls short of the program's underwriting standards. An inspection is a right the Association holds, not a step it must take before declining. The provision places the decision to decline with the Association, not with the Director. A provisional binder arises only when the Association has failed to offer or deny coverage within the period the program sets, which is not what happened here.

Answer: B. October 31, 2005

Rule 230-RICR-20-05-9, Sec. 9.4(A) provides that any policy form approved by the Department before the rule took effect, and excluding liability coverage for lead poisoning, terminated on October 31, 2005. None of the other dates is the termination date that section states.

Answer: A. On the $900 balance, from the policy's effective date through the final installment's due date

Sec. 19-14.6-2(b) computes interest on the balance of the premium due after subtracting the insured's down payment, here $1,200 minus $300, or $900. Interest runs from the date the insurance contract being financed takes effect through the date the final installment is due. Interest on the full $1,200 ignores the down payment. Starting the period at the agreement date or the first installment, or ending it at the policy's expiration, uses a period the section does not set.