Washington Surplus Lines Broker Practice Exam

These questions are part of the practice quiz. Start practicing

• What details are provided in the financial statement under Net written premium?
• How many days until uncollected Premium/agents' balances are moved to the NonAdmitted Assets column?
• Who provides the capital needed to support the syndicates’ underwriting activities?
• Which of the following best summarizes the function of a Cover Holder in Lloyd's?
• Which term refers to the financial accountability for losses an insurer is obligated to pay?
• What type of information can be found on Schedule T in a company's financials?
• What is a Cession in the context of reinsurance?
• Which penalty can the Attorney General impose if a civil penalty is not paid?
• What does FSA stand for in the context of insurance regulations?
• What does a large decrease in net premiums written typically suggest?
• What does the Gross Line refer to in insurance?
• Which formula is used to calculate the ratio of 'Gross Premiums Written to Policyholders Surplus'?
• What is the primary purpose of a Bordereau in reinsurance?
• Which of the following can be defined as a 'claim'?
• What is the usual upper limit percentage for the Gross Change in Policyholders' Surplus?
• Which financial measure reflects the economic health of an insurance company over a year?
• What is the primary purpose of the Council of Lloyd's?
• Which term describes a general reinsurance agreement between the ceding company and the reinsurer?
• What is an important regulatory consideration for surplus line brokers?
• What does a Two-Year Overall Operating Ratio below 100% signify?
• Who has the authority to waive the financial requirement for an unauthorized insurer?
• How is the common capital stock valued?
• What is the correct formula for calculating 'Net Premiums Written to Policyholders Surplus' ratio?
• What organization issues bonds from the Securities Valuation Office (SVO)?
• Who is responsible for issuing the Binding Authority Statement?
• Who is responsible for managing the syndicates and employing underwriting staff within Lloyd's?
• In general liability policies, which provision typically addresses defense costs?
• Which of the following best describes the responsibilities of a Members Agent?
• If an insurer's capital is less than what amount, the Commissioner cannot waive the financial requirement?
• What significant role do Members play in Lloyd's syndicates?
• What is the primary purpose of the FAIR plan?
• What is the purpose of the WA surplus lines stamp?
• How many days do you have to report to the Commissioner any Administrative action taken in another jurisdiction?
• Which is a requirement for maintaining a surplus lines broker license?
• How many years of active transactions must foreign and alien insurers have in their business classes to be admitted?
• Who is the Named Insured on a Railroad Protective Policy?
• Which body of Lloyd's must provide capital to support the syndicate's underwriters?
• What can be inferred if a company uses surplus aid reinsurance treaties?
• What does Stop Loss Reinsurance primarily protect against?
• What should be the usual range for the Surplus Aid to Policyholders' Surplus ratio?
• Where can one find a list of alien companies and Lloyd syndicates with their city or country of domicile?
• Which type of felony applies to violations of RCW 48.15?
• Which entity writes the insurance risks in Lloyd’s, with underwriters determining the terms?
• Which aspect does NOT typically feature in a surplus lines policy?
• If found guilty of solicitation without authorization, what action may the Commissioner take?
• What is the maximum fine if your records are not available for the Commissioner?
• Which of the following best describes an alien company in surplus lines?
• On what form is the DIC typically written?
• What is the required bond percentage for a resident producer when placing policies with a non-appointed insurer?
• In insurance accounting, how long is the typical collection period for agents' balances?
• When was the WA State regulatory stamp changed?
• Which term describes the improvement or deterioration based on operational results for the year?
• What body of Lloyd's promotes its market and determines the capital members must provide?
• What must be included in the waiver request letter to the Commissioner?
• All records of bonds must be available to the Commissioner during what time frame?
• What is issued to Cover Holders to enable them to issue insurance documentation on behalf of the Syndicate Members?
• What should the premium include, aside from the base rate?
• What is the loss limit within insurance terminology?
• Which of the following is considered the ultimate measure of improvement or deterioration in an insurer's financial condition?
• When might the WA State Insurance Commissioner waive the examination for a surplus lines broker?
• After the tax is due, how many days after will interest be applied?
• What specifically does Schedule T report?
• What is the fine associated with filing incorrect premium declarations?
• If the Commissioner believes a violation has occurred, what can be issued?
• What type of information does Schedule D contain regarding a company?
• What is the primary responsibility of underwriters in the Lloyd's market?
• The Council of Lloyd's also plays a role in:
• A '_______ _________' is a coverholder classified by Lloyd's as a service company.
• Within how many working days must a surplus lines broker provide information to a party injured under terms of the bond?
• Under which accounting practice must an insurer immediately recognize acquisition expenses?
• What does Schedule F provide information about?
• The agreed amount provision eliminates which clause?
• Cover Holders, as defined in Lloyd's practices, are responsible for:
• What is the maximum fine for placing coverage with an insolvent carrier?
• What is the classification if the stated premium on a policy is incorrect?
• Is a Joint Underwriting Association established by legislature considered an authorized insurer?
• Major differences between self-insured retentions (SIRs) and deductibles concern what aspect?
• Which ratio measures the adequacy of the cushion without considering premiums ceded?
• Which of the following statements is FALSE regarding the requirement of a WA bond for a resident surplus lines broker?
• True or False: Stop Loss Reinsurance is a type of reinsurance that reimburses the ceding company when specific class losses exceed a certain ratio.
• What is the minimum fine for placing coverage with an insolvent carrier?
• Facultative Reinsurance refers to the reinsurance of which kind of risks?
• What is the minimum deposit amount required for an alien insurer seeking a certificate of authority?
• What is the required notice period for cancellation due to non-payment of premium?
• What is the surcharge for the first 30 days if the request to renew a surplus lines broker's license is not received by the Commissioner prior to the expiration date?
• Who serves as the Attorney for a non-resident surplus lines broker to receive service of suit for causes of action that arise in this State?
• Can Mutual Assets be applied towards any member's insurance liabilities?
• What criminal charge is imposed for knowingly violating RCW 48.15 for unauthorized activities?
• What is the time frame for filing a diligent effort after the effective date?
• Which of the following terms is used to describe the insurance passed to the reinsurer?
• True or False: An insurer can enter ceding commission from a reinsurer as an asset immediately on its balance sheet.
• True or False: The certificate of authority of a reciprocal insurer is issued to its attorney in the name of the insurer?
• Common changes made by surplus line companies to general liability forms typically include?
• True or False: Reinsurance alleviates the insurer's liability under the original policy.
• Which ratio measures the insurer's ability to meet financial demands?
• How should the WA Surplus Lines Stamp be worded?
• What element does NOT typically appear in the Liabilities, Surplus, and Other Funds page?
• For how long must a surplus line broker keep financial records of a foreign unauthorized insurer?
• What percentage range is considered for 'Adjusted Policyholders' Surplus'?
• What does the acronym IRIS stand for?
• A 'Service Company' is defined as what type of organization in relation to Lloyd's?
• Where can you find the amount of Policyholders Surplus?
• Which ratio indicates the adequacy of policyholders' surplus, net of ceded premiums?
• What is the term used for the reinsurance that a reinsurer purchases for itself?
• What is the surcharge if the renewal request is made after 60 days but before 12 months after the expiration date?
• Which of the following is a purpose of the Several Assets Fund?
• Where are Certificates and supporting documents sent?
• True or False: Exempt commercial purchasers must complete a Due Diligence statement.
• What is the typical annual income percentage range for the Investment Yield Ratio?
• According to RCW 48.15.150, which individual must be designated for service of process for unauthorized insurers?
• Which of the following is NOT a requirement for being classified as an Exempt Commercial Purchaser?
• What is the typical range for the Estimated Current Reserve Deficiency to Policyholders Surplus Ratio?
• What is the general standard for the ratio of 'Gross Premiums Written to Policyholders Surplus'?
• What information can you find on Schedule Y?
• Which document typically outlines the parameters under which an entity can underwrite insurance risks?
• What is the typical upper limit for the One-Year Reserve Development to Policyholders Surplus Ratio?
• When is the last day to pay annual taxes before incurring a penalty?
• What is a key role of Managing Agents at Lloyd's?
• What is the significance of the liquidity ratio in insurance?
• Within how many days must the certification form be filed after the effective date?
• Which of the following aspects does NOT pertain to the definition of a Cover Note?
• What is the distance within which the CGL form limits contractual liability from work done near a railway?
• Which entity can grant reciprocity for a non-resident in relation to surplus lines?
• What is the governing body responsible for managing Lloyd's?
• True or False: Policy limits are refreshed when tail coverage is purchased.
• What countries are included in the AM Best report?
• Which document serves as a description of what the broker has put into effect?
• Which organization is responsible for rating bonds?
• What is the primary function of a Members Agent?
• A Cession may involve which of the following?
• What must be considered if the company were to liquidate Par Value bonds?
• What reason might the Commissioner waive the financial requirement for an unauthorized insurer?
• Which form must be provided to the Commissioner to seek a waiver?
• What amount of bond must a surplus lines broker carry in Washington State?
• What does the Reserve Ratio provide an estimate of?
• What is the maximum amount a resident broker's bond can be capped at?
• When is the annual renewal date for a certificate subject to renewal?
• Which organization determines if alien insurers meet criteria for the Quarterly Listing of Alien Insurers?
• Fair value is primarily based on which of the following?
• True or False: The Several Assets Fund is used for various risks.
• What is the usual range for the Gross Agents' Balances (in collection) to Policyholders Surplus Liquidity Ratio?
• How is a Treaty defined in terms of reinsurance?
• True or False: A Members Agent provides advice to members on which syndicates to participate in.
• What is the consequence of effectuating a contract of insurance by an unauthorized insurer in violation of the law?
• What is often a requirement for the validity of an insurance policy?
• What criteria must an association meet to offer a bond?
• A resident producer acting as a broker is required to carry what minimum bond amount for policies placed with an insurer not appointed in the previous year?
• What is the maximum amount of time a license can be suspended due to a felony conviction?
• What is the Net Line?
• In what context is the term 'state' used regarding Captive Insurance in Washington State?
• What outcome is associated with violating the provisions set by the Commissioner regarding unauthorized activities?
• What may a large increase in net premiums written indicate?
• In terms of reinsurance, what does a company usually seek from a retrocession?
• True or False: A Bordereau is a form that provides premium or loss data with respect to identified specific risks.
• What is the notice period required to cancel a Surplus Line policy, excluding non-payment?
• What may investment earnings help offset for insurers?
• Where and when should the registry stamp be placed on documents delivered to the insured?
• What does a surplus line broker need to do when notifying an insured about premium differences?
• Which ratio estimates the development of unpaid loss and loss adjustment expenses?
• True or False: An exempt commercial purchaser must be a large, sophisticated company?
• What premium amount must risks develop over three years to qualify for the program?
• What documents are required to be sent with the Certification Document?
• What role does a Managing Agent perform in a syndicate?
• What is the maximum civil penalty for each violation of solicitation by an unauthorized insurer?
• What loss limit is typically non-reimbursed under reinsurance?
• Which of the following statements are true regarding WAC 284-15 'Solvent Insurer'?
• Which statement regarding the qualifications for a non-resident to conduct business in Washington State is NOT true?
• What document outlines the service responsibilities of the Commissioner?
• What happens if a certificate is not renewed by the specified date?
• What statement about 'Stated Premium' as per 48.18.180 is TRUE?
• True or False: A Cover Note can be used in place of a binder.
• When will return premiums or claim payments be considered paid to the insured or claimant?
• What is the maximum credit or surcharge under the Account Premium Modification Plan?
• True or False: Captive Insurance is allowed in Washington State.
• What additional requirement applies specifically to exempt commercial purchasers?
• Which governing body assigns the syndicate number?
• Which statements are true regarding a professional liability policy?
• What does tail coverage typically offer to policyholders?
• Which two key tools are part of the Insurance Regulatory Information System (IRIS)?
• Which of the following is found on the Jurat Page?