Maine Property & Casualty Insurance License, Practice Exams

The superintendent denies an application for a licence. What does 24-A M.R.S. s 1420-K require, and what may the applicant do?

1. The superintendent must notify the applicant and advise in writing of the reason; the applicant may make written demand within 30 days for a hearing, and the hearing must be held within 30 days of that demand, under section 229. ✓
2. The superintendent must notify the applicant and advise in writing of the reason; the applicant may appeal to the Superior Court within 30 days of receipt of that notice, no hearing before the superintendent being available on a denial.
3. The superintendent must notify the applicant of the denial but need not give reasons; the applicant may make written demand within 30 days for a hearing, at which the superintendent will then state the ground relied upon.
4. The superintendent must notify the applicant and advise in writing of the reason; the applicant may make written demand within 14 days for a hearing, and the hearing must be held within 60 days of that written demand.

Why: 24-A M.R.S. s 1420-K(2): the superintendent SHALL NOTIFY the applicant or licensee and ADVISE, IN WRITING, OF THE REASON. The applicant or licensee MAY MAKE WRITTEN DEMAND UPON THE SUPERINTENDENT WITHIN 30 DAYS FOR A HEARING to determine the reasonableness of the action, and THE HEARING MUST BE HELD WITHIN 30 DAYS OF THAT WRITTEN DEMAND and pursuant to s 229. Thirty and thirty.

Which of the following is EXCEPTED from the guaranty association subchapter by 24-A M.R.S. s 4433(2)?

1. Contracts of reinsurance and surplus lines contracts alone, the remaining classes named in the subsection being within the subchapter but allocated to a separate account from which claims of that kind are paid when a member insurer becomes insolvent.
2. Contracts of reinsurance; mortgage guaranty; credit and collateral- protection insurance; surplus lines; title; financial guaranty; workers' compensation excess cover for self-insurers; life, annuity, health or disability insurance; and governmental insurance. ✓
3. Workers' compensation insurance of every kind, the Workers' Compensation Board administering its own security arrangements for that class, together with any policy written on a commercial form for a purchaser whose net worth exceeds twenty-five million dollars.
4. Marine and transportation insurance, title insurance and any policy of property insurance on a commercial building, the subchapter being confined to personal lines written for individuals and to the surety business transacted in this State.

Why: 24-A M.R.S. s 4433(2) excepts: (A) CONTRACTS OF REINSURANCE; (B) MORTGAGE GUARANTY insurance; (C) CREDIT insurance, VENDORS SINGLE-INTEREST, COLLATERAL PROTECTION or similar creditor insurance; (D) SURPLUS LINES contracts procured under chapter 19; (E) TITLE insurance; (F) FINANCIAL GUARANTY insurance and other protection against INVESTMENT RISKS; (G) WORKERS' COMPENSATION EXCESS insurance issued to approved SELF-INSURERS; (H) LIFE, ANNUITY, HEALTH OR DISABILITY insurance; (I) insurance of WARRANTIES OR SERVICE CONTRACTS, other than coverages in a CYBERSECURITY policy; (J) transactions transferring INVESTMENT OR CREDIT RISK unaccompanied by insurance risk; and (K) insurance PROVIDED BY OR GUARANTEED BY A GOVERNMENTAL ENTITY. Ordinary workers' compensation insurance IS covered - it is the EXCESS cover for self-insurers that is not.

The Valuable Papers and Records floater covers:

1. Cost to research, replace, or restore lost documents and records ✓
2. Money and securities kept in the insured's office safe
3. Computer hardware and the media stored in it
4. The insured's legal liability for losing a client's documents

Why: Valuable Papers and Records coverage pays the cost to research, reconstruct, or replace damaged or destroyed written, printed, or otherwise inscribed documents and records.

A personal umbrella policy typically requires the insured to maintain minimum underlying limits on:

1. Life insurance with a $100,000 face amount
2. Individual disability income benefits
3. Group health insurance from the employer
4. Personal auto and homeowners liability ✓

Why: Personal umbrellas sit above personal auto and homeowners liability and require stated minimum underlying limits on those policies.

Which of the following is one of the actions listed in 24-A M.R.S. s 2436-A(1)?

1. Threatening to appeal from an arbitration award in favour of an insured for the sole purpose of compelling the insured to accept a settlement less than the arbitration award. It is the threat, made for that purpose, that is caught. ✓
2. Appealing from an arbitration award in favour of an insured, the paragraph treating any appeal against an award as an unfair settlement practice whatever the insurer's reason for taking it and whatever the merits of the appeal may afterwards prove to be.
3. Requiring an insured to submit to arbitration under a provision of the policy, the paragraph treating a contractual arbitration clause in a policy of insurance as an unfair claims settlement practice when the insurer seeks to enforce it against an insured.
4. Failing to pay an undisputed claim within 30 days of receiving the proof of loss, which is the conduct this section reaches and for which it gives the insured a civil action for damages against the insurer in addition to interest.

Why: 24-A M.R.S. s 2436-A(1)(C): THREATENING TO APPEAL FROM AN ARBITRATION AWARD IN FAVOR OF AN INSURED FOR THE SOLE PURPOSE OF COMPELLING THE INSURED TO ACCEPT A SETTLEMENT LESS THAN THE ARBITRATION AWARD. It is the THREAT, made for THAT PURPOSE, that the paragraph reaches - not an appeal as such. Late payment of an undisputed claim is s 2436, a different section.

A producer surrenders a licence while under investigation. What does 24-A M.R.S. s 1420-K say about the superintendent's powers?

1. The superintendent's jurisdiction ends with the licence, the surrender being effective to terminate any investigation or proceeding not already concluded, although the matter may be referred to the Attorney General under section 214 if a crime is suspected.
2. The superintendent may proceed only where the surrender was made to avoid prosecution, a voluntary surrender in any other circumstance placing the former licensee outside the superintendent's disciplinary jurisdiction entirely.
3. The superintendent retains the authority to enforce the Title and impose any penalty it authorizes against a person under investigation or charged even if the licence has been surrendered or has lapsed by operation of law. ✓
4. The superintendent may proceed for one year after the surrender or lapse, after which the authority to impose a penalty or remedy against the former licensee expires by operation of the section itself.

Why: 24-A M.R.S. s 1420-K(5), ENFORCEMENT POWERS: the superintendent RETAINS THE AUTHORITY to enforce the provisions of and impose any penalty or remedy authorized by this Title, Title 24 or any other law enforced by the superintendent against any person UNDER INVESTIGATION FOR OR CHARGED WITH a violation, EVEN IF THE PERSON'S LICENSE HAS BEEN SURRENDERED OR HAS LAPSED BY OPERATION OF LAW. See also s 1417(3) on a voluntary surrender being deemed a suspension or revocation.

The Peak Season endorsement is most useful for an insured whose:

1. Personal property (inventory) increases significantly during certain periods ✓
2. Automobile fleet expands each summer to handle additional delivery routes and drivers
3. Liability exposure drops in the winter months when the seasonal operation is closed
4. Building value stays constant year after year and needs no adjustment at renewal

Why: Peak Season provides additional limits on business personal property during seasonal periods of higher inventory, such as a retailer before the holidays.

How does a NONPROFIT or PUBLIC ENTITY, or a MUNICIPALITY, qualify as a large commercial policyholder under 24-A M.R.S. s 2412-A(1)(B)?

1. A nonprofit or public entity with an annual budget or assets of $25,000,000 or more that meets the subparagraph (2) criteria; and a municipality with a population of 20,000 or more that meets the premium criterion in subparagraph (2), division (b). ✓
2. A nonprofit or public entity with an annual budget of $10,000,000 or more, and a municipality of any size, each having to meet all three of the size tests in subparagraph (1) in the same way as an ordinary commercial policyholder does.
3. A nonprofit or public entity that certifies it employs a risk manager, and a municipality that has adopted a self-insurance programme under the Maine Tort Claims Act, neither having to meet any financial or premium test set out in the paragraph.
4. A nonprofit or public entity with assets of $25,000,000 or more, and a municipality with a population of 20,000 or more, each having in addition to obtain the superintendent's written waiver of the remaining criteria before the section can apply to it.

Why: 24-A M.R.S. s 2412-A(1)(B): LARGE COMMERCIAL POLICYHOLDER ALSO INCLUDES a NONPROFIT OR PUBLIC ENTITY WITH AN ANNUAL BUDGET OR ASSETS OF $25,000,000 OR MORE that meets the criteria in SUBPARAGRAPH (2), and a MUNICIPALITY WITH A POPULATION OF 20,000 OR MORE that meets the PREMIUM CRITERIA IN SUBPARAGRAPH (2), DIVISION (b). The municipality route needs the premium test only - not the risk manager.

What excuses a late first payment under 39-A M.R.S. s 205(2)(A)?

1. An act of God or unavoidable circumstances alone, a mistake of fact being no excuse because the employer and its insurer are taken to know the facts of an injury of which proper notice has been given to them by the employee.
2. An act of God, a mistake of fact or unavoidable circumstances - but an employer's failure to timely report an injury for which proper notice was given is not an excuse for the insurer. ✓
3. Any circumstance the board considers reasonable, including the employer's failure to report the injury to its insurer promptly, which the paragraph treats as a matter between employer and insurer rather than one affecting the employee.
4. Nothing at all, the obligation to make the first payment within 14 days being absolute and the penalty attaching automatically whatever the reason for the delay in making the payment to the injured employee.

Why: 39-A M.R.S. s 205(2)(A): THERE IS NO PENALTY for a failure to make a timely payment IF THE FIRST PAYMENT CANNOT BE PAID WITHIN 14 DAYS DUE TO AN ACT OF GOD, TO A MISTAKE OF FACT OR TO UNAVOIDABLE CIRCUMSTANCES. AN EMPLOYER'S FAILURE TO TIMELY REPORT AN INJURY FOR WHICH PROPER NOTICE WAS GIVEN IS NOT AN EXCUSE FOR THE INSURER.

When does 24-A M.R.S. s 2902(3) treat an INSURED other motor vehicle as an 'uninsured motor vehicle'?

1. Where the other vehicle's liability insurer denies coverage on any ground, including insolvency, late notice or a breach of a policy condition by its own insured, provided written notice of the occurrence is given to the uninsured vehicle carrier within two years of the accident.
2. Where the other vehicle's liability insurer becomes insolvent at any time, whether before or after the occurrence, the subsection protecting the insured against the failure of the other carrier without regard to when the coverage was in effect.
3. Where the other vehicle's liability insurer is unable to pay because of its insolvency, and the insured has first exhausted every remedy against the insolvent insurer's guaranty association in the state where that insurer was domiciled.
4. Where the other vehicle's liability insurer is unable because of its insolvency to pay within its policy limits; the occurrence took place while the uninsured vehicle coverage was in effect; and written notice of the occurrence was given to the insurer within 2 years. ✓

Why: 24-A M.R.S. s 2902(3): UNINSURED MOTOR VEHICLE is deemed also to include an INSURED other motor vehicle where (A) the liability insurer of that vehicle IS UNABLE BECAUSE OF ITS INSOLVENCY TO MAKE PAYMENT within its policy limits; (B) the occurrence TOOK PLACE WHILE THE UNINSURED VEHICLE COVERAGE REQUIRED UNDER SUBSECTION 1 WAS IN EFFECT; and (C) WRITTEN NOTICE OF THE OCCURRENCE WAS GIVEN TO THE INSURER WITHIN 2 YEARS thereof. Nothing prevents an insurer from providing insolvency protection on MORE FAVORABLE terms.

A licensee fails to pay the biennial continuation fee by its due date. What does 24-A M.R.S. s 1416-A provide?

1. Failure to pay by the due date results in the immediate lapse of the licence, which may then be reinstated within 12 months without examination under section 1420-F, subsection 3 of the Insurance Code.
2. Failure to pay within 30 days from the due date results in suspension of the licence, and failure to pay within 90 days results in its revocation, the two periods running consecutively from the original due date.
3. Failure to pay within 90 days from the due date results in suspension or revocation under section 1417 for violating the insurance laws within section 1420-K, subsection 1 in terms as the section has it. ✓
4. Failure to pay within 90 days from the due date results in a late fee under section 601, the licence continuing in force until the superintendent takes action against it under section 1417 after notice and hearing.

Why: 24-A M.R.S. s 1416-A(3): FAILURE TO PAY THE REQUIRED FEES BY A LICENSEE WITHIN 90 DAYS FROM THE DUE DATE RESULTS IN SUSPENSION OR REVOCATION OF THE LICENSE PURSUANT TO SECTION 1417, FOR VIOLATING THE INSURANCE LAWS PURSUANT TO SECTION 1420-K, SUBSECTION 1, PARAGRAPH B. The route runs through the discipline sections, not through lapse.

The Gramm-Leach-Bliley Act (GLBA) requires financial institutions, including insurers, to:

1. Offer multiple peril crop insurance to every agricultural customer and report the resulting yield data to the Risk Management Agency before spring planting
2. Write flood coverage on any dwelling financed through the institution
3. Join the state FAIR Plan as an assessable member
4. Protect the privacy of nonpublic personal financial information and give consumers notice and an opt-out right before sharing it with nonaffiliated third parties ✓

Why: GLBA's privacy provisions require notice of information-sharing practices and, in many cases, allow consumers to opt out of having their nonpublic personal financial information shared with nonaffiliated third parties.

Under the BACF, newly acquired autos are covered automatically if:

1. They are reported to the insurer within 90 days of purchase, whatever symbol appears on the Declarations page
2. Only when the new unit is a private passenger auto
3. No notice is ever needed, since every symbol picks up new units automatically
4. They fall within the description of covered autos (symbol) and the insurer is notified per policy terms ✓

Why: A newly acquired auto is automatically covered if it qualifies under the symbol designation, often with a notice requirement (e.g., 30 days) for some coverages.

How does 24-A M.R.S. s 1420-F define the CASUALTY line of authority?

1. Insurance coverage against legal liability arising out of the ownership, maintenance or use of a motor vehicle or of premises, together with coverage for the medical expenses of persons injured on those premises.
2. Insurance coverage against legal liability, including coverage for death, for injury or disability, or for damage to property real or personal belonging to some other person and not to the insured indeed. ✓
3. Insurance coverage for sickness, bodily injury or accidental death, and it may include benefits for disability income, casualty being the line under which accident business is written in this State.
4. Insurance coverage against legal liability only, so that a policy which also covers death, injury or disability must be written under the accident and health or sickness line of authority instead.

Why: 24-A M.R.S. s 1420-F(1)(D): CASUALTY is INSURANCE COVERAGE AGAINST LEGAL LIABILITY, INCLUDING COVERAGE FOR DEATH, INJURY OR DISABILITY OR DAMAGE TO REAL OR PERSONAL PROPERTY. The third option is ACCIDENT AND HEALTH OR SICKNESS under (B). Casualty is not confined to liability alone.

What does 24-A M.R.S. s 1465 require before a consultant acts for a client?

1. A written contract with the client including the amount and basis of any consulting fee, the duration of employment being a matter for the parties and the form of the contract being at the consultant's own discretion.
2. A written contract with the client, entered into first, including without limitation the amount and basis of any consulting fee and the duration of employment, and in a form approved by the superintendent. ✓
3. A written disclosure to the client of the consultant's fee basis and of any commission the consultant may also receive, signed by the client, a formal contract being required only where the engagement exceeds 12 months.
4. A written contract with the client in a form approved by the superintendent, which the consultant must file with the Bureau within 30 days of its execution together with the fee prescribed by section 601 for the filing.

Why: 24-A M.R.S. s 1465: a licensee MAY NOT ACT IN ANY FURTHER CAPACITY FOR WHICH A LICENSE IS REQUIRED WITHOUT HAVING FIRST ENTERED INTO A WRITTEN CONTRACT WITH A CLIENT. The contract MUST INCLUDE, WITHOUT LIMITATION, THE AMOUNT AND BASIS OF ANY CONSULTING FEE AND THE DURATION OF EMPLOYMENT and MUST BE IN A FORM APPROVED BY THE SUPERINTENDENT. The duration matters - s 1466(1) measures the 12 months against the period specified in this contract.

Which of the following is a cause for licence denial, nonrenewal or revocation under 24-A M.R.S. s 1420-K?

1. Failing to achieve a minimum volume of premium in the lines of authority for which the producer is licensed over any period of two consecutive calendar years while the licence remains in force in this State.
2. Improperly using notes or any other reference material to complete an examination for an insurance licence which is one of the fourteen causes the subsection lists and is not the only one that has nothing to do with money. ✓
3. Placing business with an insurer that is authorized in the producer's home state but not in this State, whether or not the risk insured is resident, located or to be performed within this State at the time of the placement.
4. Failing to complete the continuing education required by subchapter vii within the biennial period, which is dealt with instead as a failure to pay the fee due under section 601 of the Insurance Code.

Why: 24-A M.R.S. s 1420-K(1)(K): IMPROPERLY USING NOTES OR ANY OTHER REFERENCE MATERIAL TO COMPLETE AN EXAMINATION FOR AN INSURANCE LICENSE is one of the fourteen causes listed. The others include incorrect or materially untrue information in the application (A), violating any insurance law, rule, subpoena or order (B), obtaining a licence by fraud (C), misappropriating money (D), and knowingly accepting business from an unlicensed individual (L).

A business decides not to manufacture a dangerous chemical at all to eliminate the chance of related liability claims. This is an example of risk:

1. Transfer
2. Reduction
3. Avoidance ✓
4. Retention

Why: Risk avoidance eliminates the possibility of a particular loss by not engaging in the activity that creates the exposure.

Liquor liability (dram shop) coverage is needed because the CGL excludes liability for businesses that:

1. Serve prepared food to the public and are therefore required to hold a food-handler permit from the local health department
2. Manufacture, distribute, sell, or serve alcoholic beverages and cause or contribute to a patron's intoxication ✓
3. Rent out portions of their premises to tenants under written leases running longer than twelve consecutive months
4. Hire independent contractors whose work the insured does not directly supervise

Why: The CGL liquor liability exclusion applies to those in the alcohol business; they need separate liquor liability coverage.

Under the PAP, sound-reproducing equipment that IS permanently installed by the manufacturer is:

1. Covered under Part D physical damage as part of the auto ✓
2. Covered only under Part B if damaged in an accident causing injury
3. Never covered, as electronics are excluded
4. Excluded under Part D as added equipment

Why: Factory or permanently installed original equipment is part of the covered auto under Part D; the limitation targets certain aftermarket/added electronic equipment.

What does 24-A M.R.S. s 1420-D require of a resident individual applying for an insurance producer licence?

1. To pass a written examination unless exempt under section 1420-H, the examination testing the lines of authority applied for, the duties and responsibilities of an insurance producer, and the insurance laws and regulations of this State. ✓
2. To pass a written examination in every case, the exemptions in section 1420-H applying only to nonresident applicants who hold a current licence in their own home state for the same lines of authority applied for here.
3. To pass a written examination and to complete an approved prelicensing course, the course being a condition of admission to the examination rather than an alternative route to the licence being applied for.
4. To pass a written examination administered by the superintendent in person, the section forbidding the use of an outside testing service for any examination leading to a resident producer licence in this State.

Why: 24-A M.R.S. s 1420-D(1): a RESIDENT INDIVIDUAL applying for a producer licence MUST PASS A WRITTEN EXAMINATION UNLESS EXEMPT PURSUANT TO SECTION 1420-H, testing the LINES OF AUTHORITY APPLIED FOR, the duties and responsibilities of a producer, and the insurance laws and regulations of this State. s 1420-D(2) expressly allows an outside testing service.

What must an employee show to be entitled to compensation under 39-A M.R.S. s 201(1)?

1. A personal injury occurring on the employer's premises during working hours, the Act being confined to injuries sustained at the place of work and leaving injuries elsewhere to the employee's remedies at common law against the person responsible.
2. A personal injury arising out of and in the course of employment, or disability by occupational disease, the employee having given no notice of a common law claim or having waived it, and the employer having assented to the Act. ✓
3. A personal injury caused by the employer's negligence or by the negligence of a fellow employee, fault remaining the basis of the employer's liability under the Act as it is at common law, but with the defences in section 103 removed.
4. A personal injury arising out of employment and a finding by the board that the employee has exhausted every other source of indemnity, the Act being a residual remedy that responds only where no other coverage is available to the injured worker.

Why: 39-A M.R.S. s 201(1): if an employee WHO HAS NOT GIVEN NOTICE OF A CLAIM OF COMMON LAW OR STATUTORY RIGHTS OF ACTION, OR WHO HAS GIVEN THE NOTICE AND HAS WAIVED THE CLAIM, as provided in s 301, RECEIVES A PERSONAL INJURY ARISING OUT OF AND IN THE COURSE OF EMPLOYMENT OR IS DISABLED BY OCCUPATIONAL DISEASE, the employee MUST BE PAID COMPENSATION AND FURNISHED MEDICAL AND OTHER SERVICES BY THE EMPLOYER WHO HAS ASSENTED to become subject to the Act. Fault is not an element.

May the superintendent suspend the large commercial contracts programme, and what follows a suspension under 24-A M.R.S. s 2412-A(5)?

1. Yes - but only after a hearing held on notice to every insurer writing the line concerned, and the waiver then continues until the Legislature acts, the superintendent having no power to restore the programme once it has been suspended for a class.
2. Yes - on finding that a sufficient degree of competition does not exist for a line, class or type, the superintendent may deem the section waived for so long as that is so; and on the request of 5 or more interested parties must hold a hearing within 45 days. ✓
3. No - the section operates by force of the statute and the superintendent has no power to waive it, a policyholder that ceases to meet the criteria simply falling back into the ordinary filing and approval regime at its next renewal.
4. Yes - on the petition of 5 or more insurers authorized to write the line, and the superintendent must then hold a hearing within 45 days at which the petitioners bear the burden of showing that competition in the line is insufficient.

Why: 24-A M.R.S. s 2412-A(5): IF THE SUPERINTENDENT FINDS AT ANY TIME THAT A SUFFICIENT DEGREE OF COMPETITION DOES NOT EXIST for a particular line, class or type of insurance, the superintendent MAY DEEM THE PROVISIONS OF THIS SECTION WAIVED for so long as that remains so. AFTER WAIVER, UPON THE REQUEST OF 5 OR MORE INTERESTED PARTIES, the superintendent SHALL, WITHIN 45 DAYS of the request, HOLD A HEARING at which interested parties may present evidence as to whether sufficient competition exists. The waiver comes first; the hearing follows it.

In a CPP, which provision governs cancellation, transfer of rights, and examination of books for ALL coverage parts?

1. The Causes of Loss form
2. The Declarations only
3. The Common Policy Conditions ✓
4. The BPP

Why: The Common Policy Conditions apply to every coverage part in the package and address cancellation, changes, inspections, premiums, and transfer of rights.

What uninsured motor vehicle coverage must a COMMERCIAL policy form provide under 24-A M.R.S. s 2902(7)?

1. Limits equal to the bodily injury liability limits of the commercial policy unless the insured expressly rejects them in writing, the subsection applying the private passenger rule to commercial forms so that the two are administered alike.
2. Not less than the minimum limits under Title 29-A, section 1605, subsection 1, and the insured must affirmatively reject any higher limits offered, failing which the higher limits attach from the inception of the commercial policy.
3. No uninsured motor vehicle coverage at all, commercial policy forms being outside chapter 39 and the compulsory uninsured coverage requirement applying only to private passenger automobile insurance written in this State.
4. Not less than the minimum limits for bodily injury liability under Title 29-A, section 1605, subsection 1; and coverage so provided does not obligate the insured to affirmatively reject an offer of higher uninsured motor vehicle limits. ✓

Why: 24-A M.R.S. s 2902(7): NOTWITHSTANDING subsection 2, a policy providing uninsured motor vehicle coverage UNDERWRITTEN ON A COMMERCIAL POLICY FORM approved for use here MUST PROVIDE COVERAGE IN AN AMOUNT NOT LESS THAN THE MINIMUM LIMITS under Title 29-A s 1605(1). Coverage so provided DOES NOT OBLIGATE THE INSURED TO AFFIRMATIVELY REJECT an offer of higher limits, and the subsection may not be construed to LIMIT OR COMPEL an insured's election of higher limits.

Within what time must an examination result be given, and how long does a passing result remain good, under 24-A M.R.S. s 1410?

1. Within 14 days after the individual completes the examination the result must be given; and a passing result remains good for 12 months, after which the applicant must sit the whole examination again before applying for a licence.
2. Within 30 days after the individual completes the examination the result must be given; and a passing result remains good indefinitely, so long as the applicant has not in the meantime been denied a licence under section 1420-K.
3. Within 30 days after the individual completes the examination the result must be given; and an individual who does not apply for a licence within 2 years after passing must register and pay for a subsequent examination. ✓
4. Within 30 days after the individual completes the examination the result must be given; and an individual who does not apply within 90 days after passing must register and pay for a subsequent examination on all parts.

Why: 24-A M.R.S. s 1410(6): WITHIN 30 DAYS after the individual completes the examination the superintendent or the testing service shall inform the individual whether or not the individual has passed; and AN INDIVIDUAL WHO DOES NOT APPLY FOR A LICENSE WITHIN 2 YEARS AFTER PASSING one part or all of an examination MUST REGISTER AND PAY THE FEE FOR A SUBSEQUENT EXAMINATION. One who fails one part of a two-part examination pays the full fee but is re-examined only on the failed part.

In most liability policies, defense costs are:

1. Paid in addition to the limit of liability ✓
2. Deducted from the limit of liability
3. Paid by the insured
4. Never covered

Why: Defense costs are typically paid in addition to (outside) the policy limits in standard liability forms, though some forms erode limits.

A policy that contains only one coverage part is best described as:

1. A package policy
2. A reporting form
3. A monoline policy ✓
4. An umbrella policy

Why: A monoline policy provides only one type of coverage; combining two or more coverage parts creates a package policy.

An insurer pays a claim under uninsured vehicle coverage. What does 24-A M.R.S. s 2902(4) give it?

1. To the extent of the payment, the insurer is entitled to the proceeds of any settlement or recovery from any person legally responsible for the bodily injury, and to amounts recoverable from the assets of the insolvent insurer of the other motor vehicle. ✓
2. To the extent of the payment, the insurer is entitled to the proceeds of any settlement or recovery from the person legally responsible, but has no claim whatever against the assets of an insolvent insurer, which are administered under the delinquency provisions.
3. A right of action in its own name against the uninsured motorist, exercisable only after the insured has been made whole, the subsection subordinating the insurer's recovery to the insured's uncompensated loss in every case.
4. No right of recovery at all, uninsured vehicle coverage being first-party coverage for which the insured has paid a premium, and the subsection expressly abolishing subrogation as to payments made under it in this State.

Why: 24-A M.R.S. s 2902(4): in the event of payment under uninsured vehicle coverage, and subject to the terms of that coverage, TO THE EXTENT OF SUCH PAYMENT THE INSURER SHALL BE ENTITLED TO THE PROCEEDS OF ANY SETTLEMENT OR RECOVERY FROM ANY PERSON LEGALLY RESPONSIBLE for the bodily injury, AND TO AMOUNTS RECOVERABLE FROM THE ASSETS OF THE INSOLVENT INSURER of the other motor vehicle.

A commercial policyholder meets the premium criterion but not three of the other qualifying criteria. What does 24-A M.R.S. s 2412-A(1)(B) allow?

1. It may certify itself as a large commercial policyholder on the strength of the premium criterion alone, the remaining criteria being directory rather than mandatory where the premium paid shows the policyholder to be a substantial buyer of insurance.
2. It may petition the superintendent for a waiver of the remaining criteria, and the superintendent may grant one on determining that the applicant for a waiver is sufficiently qualified to act as a large commercial policyholder under this section. ✓
3. It may apply to the insurer, which may accept the certification on its own responsibility and must record the reasons in the underwriting file, the superintendent reviewing the decision only if the contract afterwards comes under examination.
4. It has no remedy, the criteria being conditions on the operation of the section which neither the superintendent nor the insurer may relax in a particular case however sophisticated a buyer of insurance the policyholder may in fact be.

Why: 24-A M.R.S. s 2412-A(1)(B): a commercial policyholder that MEETS THE PREMIUM CRITERIA in subparagraph (2), division (b) BUT DOES NOT MEET 3 OF THE QUALIFYING CRITERIA listed in either subparagraph (1) or subparagraph (2), division (a) MAY PETITION THE SUPERINTENDENT FOR A WAIVER OF THE REMAINING CRITERIA. The superintendent MAY GRANT a waiver on determining that the applicant IS SUFFICIENTLY QUALIFIED TO ACT AS A LARGE COMMERCIAL POLICYHOLDER.

The insured, who holds a producer's certificate, asks for the insurer's policy. What does 24-A M.R.S. s 2008(4) require?

1. The producer shall as soon as reasonably possible procure from the insurer its policy evidencing the insurance and deliver it to the insured in replacement of the producer's certificate. ✓
2. The producer shall procure the policy to replace the certificate within thirty days of the request and, failing that, shall return the whole premium to the insured and arrange replacement coverage with an authorized insurer at no additional cost to the insured in this State.
3. The producer may charge the insured a reasonable fee for procuring the policy, the certificate being the evidence of insurance the chapter contemplates and the policy itself being an accommodation the producer furnishes only on request.
4. The producer shall refer the request to the superintendent, who requires the nonadmitted insurer to issue its policy as a condition of remaining on the list of eligible surplus lines insurers published under section 2007 of this chapter.

Why: 24-A M.R.S. s 2008(4): where a policy is not available on placement and the producer has issued and delivered the certificate, UPON REQUEST OF THE INSURED the producer shall AS SOON AS REASONABLY POSSIBLE PROCURE FROM THE INSURER ITS POLICY evidencing the insurance and DELIVER THE POLICY TO THE INSURED IN REPLACEMENT OF THE PRODUCER'S CERTIFICATE.

An employer operates in a monopolistic state fund jurisdiction and also wants protection against employee lawsuits not covered by the fund. The appropriate solution is:

1. An assigned-risk placement
2. A stop gap employers liability endorsement ✓
3. A Defense Base Act policy
4. A standard Part One policy from a private insurer

Why: Because monopolistic funds provide statutory benefits but not employers liability, a stop gap endorsement (employers liability) on the employer's general liability or WC policy fills that exposure.

Beyond the table figures, what continuing requirement does 24-A M.R.S. s 410(1)(E) place on an insurer's surplus?

1. It must maintain surplus of not less than twice the table figure for the kinds it transacts, that multiple being fixed by the paragraph and not open to adjustment by the superintendent in an individual case.
2. It must file a quarterly statement showing that its surplus has not fallen below the table figure, the superintendent having no power to require more than the table amount once the certificate of authority has been issued.
3. It must at all times maintain policyholders' surplus, combined paid-in capital stock if any, and surplus, reasonable in amount as determined by the superintendent in relation to the kinds and amount of insurance it has in force or is writing and retaining, net of applicable reinsurance, the superintendent giving due consideration to applicable NAIC standards. ✓
4. It must maintain surplus reasonable in relation to the premium it writes in this State, measured gross of reinsurance so that the insurer cannot reduce the requirement by ceding part of the risk to a reinsurer.

Why: 24-A M.R.S. s 410(1)(E): the insurer shall AT ALL TIMES MAINTAIN POLICYHOLDERS' SURPLUS, COMBINED PAID-IN CAPITAL STOCK, IF ANY, AND SURPLUS, REASONABLE IN AMOUNT, AS DETERMINED BY THE SUPERINTENDENT, in relation to THE KINDS AND AMOUNT OF INSURANCE IT HAS IN FORCE, OR BEING WRITTEN AND RETAINED BY IT, NET OF APPLICABLE REINSURANCE, with due consideration to NAIC standards. It is net of reinsurance and it is a judgment, not a multiple.

An insured wants to cover a $40,000 diamond ring with no deductible and broad worldwide protection. The best approach is:

1. Add a scheduled personal property floater (endorsement) listing the ring ✓
2. Apply to the state FAIR Plan, which writes basic property coverage on risks the voluntary market has declined
3. Buy an NFIP dwelling policy, since federal flood coverage follows scheduled jewelry anywhere in the world
4. Rely on the homeowners Coverage C limit, which pays the full $40,000 once the policy deductible is satisfied

Why: High-value items exceeding homeowners sublimits are best covered by scheduling them on a personal property floater, which offers broad, often worldwide, coverage with no deductible.

How long may an apprentice insurance producer licence run under 24-A M.R.S. s 1420-Q?

1. Not more than 180 days, renewable once at the superintendent's discretion where the sponsor certifies that the apprentice is making satisfactory progress towards the producer examination for the lines concerned.
2. Not more than 12 months, the period being fixed to allow the apprentice to complete the continuing education required of a resident individual producer before applying for a full licence under section 1420-E.
3. Not more than 180 days in any one calendar year, an individual being entitled to a second apprenticeship in a later year with the same or a different sponsor on a fresh application to the superintendent.
4. Not more than 180 days, and it is nonrenewable - after 180 days the apprentice may not engage in any activity requiring a producer licence without obtaining one under the requirements of the subchapter. ✓

Why: 24-A M.R.S. s 1420-Q(4), LICENSE DURATION; NONRENEWABLE: an apprentice licence MAY NOT BE AUTHORIZED FOR MORE THAN 180 DAYS, and AFTER HAVING COMPLETED 180 DAYS the apprentice MAY NOT ENGAGE IN ANY INSURANCE ACTIVITIES REQUIRING A PRODUCER LICENSE WITHOUT OBTAINING ONE in accordance with the subchapter. Section 1420-Q(1)(D) bars a second apprenticeship.

Installing a sprinkler system and smoke alarms in a warehouse is an example of risk:

1. Avoidance
2. Transfer
3. Sharing
4. Reduction ✓

Why: Risk reduction lowers the frequency or severity of potential losses through measures like safety devices.

Within what time must a licensee report a change of address, name or other material change under 24-A M.R.S. s 1419?

1. No later than 15 days after the change in every case, section 1419 setting a single period for every reportable matter so that no other provision of law can displace it for a particular kind of change.
2. No later than 30 days after the change, and a notice received after that period is of no effect, the licensee being required to apply afresh for a licence showing the changed particulars instead.
3. Before the change takes effect, the superintendent being required to approve any change in the conditions or qualifications set out in the licensee's original application before the licensee may act upon it.
4. No later than 30 days after the change, unless a different time is set by another provision of law; and a notice received after the prescribed period attracts the late filing fee prescribed in section 601. ✓

Why: 24-A M.R.S. s 1419: UNLESS A DIFFERENT TIME IS SET BY ANOTHER PROVISION OF LAW, any change of address, telephone number, e-mail address, name OR OTHER MATERIAL CHANGE in the conditions or qualifications set forth in the original application MUST BE REPORTED NO LATER THAN 30 DAYS AFTER THE CHANGE, and a late notice attracts THE LATE FEE prescribed in s 601. Compare s 1420-F(6), the parallel 30-day address rule for producers.

What records must a consultant keep, and for how long, under 24-A M.R.S. s 1468?

1. All contracts with clients and all correspondence relating to them, at the consultant's place of business, for 5 years from the termination of the contracts, in paper form available for inspection by the superintendent.
2. All contracts with clients, at the consultant's place of business, for 3 years from the date on which each contract was entered into, the retention period running from execution rather than from the end of the engagement.
3. All contracts with clients, at the consultant's place of business, for 3 years from the termination of the contracts; and for investigation or examination they may be maintained in electronic form. ✓
4. All contracts with clients together with a record of every fee charged and every commission received under them, for 3 years from termination, and a copy of each contract must be filed with the superintendent on execution.

Why: 24-A M.R.S. s 1468: the consultant shall KEEP AT THE CONSULTANT'S PLACE OF BUSINESS ALL CONTRACTS WITH CLIENTS FOR A PERIOD OF 3 YEARS FROM THE TERMINATION OF THE CONTRACTS, and for investigation or examination by the superintendent CONTRACTS MAY BE MAINTAINED IN ELECTRONIC FORM. Three years FROM TERMINATION - compare s 1447(2), also three years, but from COMPLETION OF THE TRANSACTION.

Transportation expenses coverage under PAP Part D typically reimburses the insured for:

1. Rental/temporary transportation costs after a covered loss, subject to a daily and total maximum ✓
2. Lost wages for the days the insured cannot drive to work while the auto is repaired
3. Towing and labor at the scene of any mechanical breakdown, whether or not a loss occurred
4. The full daily cost of a rental car until the insured chooses to return it

Why: Transportation expenses coverage pays temporary transportation (e.g., rental) costs following a covered Part D loss, subject to per-day and per-occurrence limits.

May services be offered free or below market value to potential insurance customers under 24-A M.R.S. s 2163-A?

1. Yes, provided the services relate directly to an insurance contract and the recipient is told orally before the purchase that the services are available whether or not any insurance is bought from the person offering them.
2. No - offering anything of value below its market price to a potential insurance customer is an inducement prohibited by section 2162 and by section 2163, whatever disclosure may be made to the recipient beforehand.
3. Yes, provided the value of the services does not exceed $100 per year per person, which is the ceiling the section applies to gifts given in connection with marketing for the sale or retention of contracts of insurance.
4. Yes, whether or not the services relate to an insurance contract, as long as receipt is not contingent on the purchase of insurance and the services are offered on the same terms to all potential customers; and the person must disclose conspicuously in writing, before purchase, quote or designation of an agent of record, that receipt is not contingent on purchase. ✓

Why: 24-A M.R.S. s 2163-A(3): the section does not prohibit a person OFFERING OR PROVIDING SERVICES, WHETHER OR NOT DIRECTLY RELATED TO AN INSURANCE CONTRACT, FOR FREE OR FOR LESS THAN FAIR MARKET VALUE, AS LONG AS RECEIPT IS NOT CONTINGENT UPON THE PURCHASE OF INSURANCE AND THE SERVICES ARE OFFERED ON THE SAME TERMS TO ALL POTENTIAL INSURANCE CUSTOMERS. The person SHALL DISCLOSE CONSPICUOUSLY IN WRITING to the recipient BEFORE THE PURCHASE OF INSURANCE, RECEIPT OF A QUOTE OR DESIGNATION OF AN AGENT OF RECORD that receipt is not contingent on purchase.

What does 24-A M.R.S. s 2157 prohibit?

1. Making, publishing or circulating any oral or written statement, pamphlet or article which is false, or maliciously critical of an insurer, and which is calculated to injure a person in the business of insurance. ✓
2. Making any statement critical of a competing insurer, whether or not the statement is false or malicious, the section protecting insurers from adverse comment by those engaged in the same business in this State.
3. Publishing a false statement about an insurer's financial condition, statements about other aspects of an insurer's business falling under section 2153 as misrepresentations rather than under this section as defamation.
4. Making a false statement about an insurer where the maker knew it to be false, a statement made honestly but carelessly falling outside the section because no intention to injure can be inferred from carelessness alone.

Why: 24-A M.R.S. s 2157, DEFAMATION: no person shall make, publish, disseminate or circulate, DIRECTLY OR INDIRECTLY, OR AID, ABET OR ENCOURAGE the making, publishing, disseminating or circulating of, any ORAL OR WRITTEN STATEMENT or any PAMPHLET, CIRCULAR, ARTICLE OR LITERATURE WHICH IS FALSE, OR MALICIOUSLY CRITICAL OF OR DEROGATORY TO AN INSURER, or an organization PROPOSING to become an insurer, AND WHICH IS CALCULATED TO INJURE any person engaged or proposing to engage in the business of insurance. False OR maliciously critical - either will do.

What does 24-A M.R.S. s 1413 provide about the individual designated responsible for a business entity's compliance?

1. At least one individual licensee must be designated; the entity must tell the superintendent within 30 days of every change of that person; and if the responsible person loses their licence the entity licence is suspended until a new designation is made.
2. Every officer, member and partner of the entity must be individually licensed and jointly responsible for its compliance, no single designation being permitted because responsibility for compliance cannot be delegated to one person.
3. At least one individual licensee must be designated; the entity must tell the superintendent within 14 days of every change of that person If the responsible person loses their own licence the entity licence terminates unless a new one is designated. ✓
4. At least one individual licensee must be designated, and the designation may be changed at the entity's discretion without notice to the superintendent, the entity itself remaining answerable for compliance in every case.

Why: 24-A M.R.S. s 1413(3): AT LEAST ONE INDIVIDUAL LICENSEE MUST BE DESIGNATED RESPONSIBLE for the entity's compliance; the entity shall notify the superintendent WITHIN 14 DAYS of every change of that person; and IF THE RESPONSIBLE PERSON LOSES THAT PERSON'S LICENSE, THE BUSINESS ENTITY LICENSE TERMINATES IF A NEW PERSON IS NOT DESIGNATED WITHIN 14 DAYS. Under s 1413(4) a change in the individuals designated TO ACT IN THE NAME of the entity is reported within 30 DAYS - fourteen and thirty, in the same section, on different subjects.

Who calculates interest on an award of compensation, and is an express order required, under WCB Rule ch. 8 s 7?

1. Interest is calculated by the board's central office and included in the decree, and is payable only where the mediator or administrative law judge has expressly ordered it in the decision resolving the employee's claim for compensation.
2. Interest is calculated by the employee and claimed on a petition for review, the employer being under no obligation to compute or to pay it until the board has determined the amount on that petition in a further proceeding.
3. Interest is calculated by the employer but is payable only from the date of the decision, not from the date each payment fell due, and only where the decision expressly awards it to the employee under this Act.
4. Interest must be calculated by the employer and paid to the employee under 39-A s 205(6); and it must be paid even if there is no express language in the decision of the mediator or administrative law judge ordering such payment. ✓

Why: WCB Rule ch. 8 s 7: INTEREST ON AWARDS OF COMPENSATION MUST BE CALCULATED BY THE EMPLOYER AND PAID TO THE EMPLOYEE PURSUANT TO 39-A M.R.S.A. s 205(6). INTEREST MUST BE PAID TO THE EMPLOYEE EVEN IF THERE IS NO EXPRESS LANGUAGE IN THE DECISION OF THE MEDIATOR OR ADMINISTRATIVE LAW JUDGE ORDERING SUCH PAYMENT. It MUST BE CALCULATED USING THE FORMULAE AND TABLE CONTAINED IN APPENDIX I. The rate itself is 10% per annum under s 205(6).

What remedy does 24-A M.R.S. s 2436-A(1) give, and against whom?

1. A person injured by any of the listed actions may complain to the superintendent, who may impose civil penalties under section 12-A, the section creating no private remedy because the conduct it describes is a regulatory matter for the Bureau of Insurance.
2. A person injured by any of the listed actions taken by any insurer, whether or not that insurer is the person's own, may bring a civil action, so that a claimant injured by the conduct of a liability insurer defending another party may sue on the section.
3. A person injured by any of the listed actions may bring a civil action for damages alone, the section leaving costs, attorney's fees and interest to be dealt with under the general law of this State applicable to civil actions on a contract.
4. A person injured by any of the listed actions taken by that person's own insurer may bring a civil action against it and recover damages, together with costs and disbursements, reasonable attorney's fees and interest on damages at 1 1/2% per month. ✓

Why: 24-A M.R.S. s 2436-A(1): A PERSON INJURED BY ANY OF THE FOLLOWING ACTIONS TAKEN BY THAT PERSON'S OWN INSURER MAY BRING A CIVIL ACTION AND RECOVER DAMAGES, TOGETHER WITH COSTS AND DISBURSEMENTS, REASONABLE ATTORNEY'S FEES AND INTEREST ON DAMAGES AT THE RATE OF 1 1/2% PER MONTH. Note the contrast with s 2164-D(8), which creates NO private cause of action - that is the chapter 23 section and is enforced by the superintendent.

A Maine-authorized insurer wishes to transact financial guaranty insurance and nothing else. What does 24-A M.R.S. s 410 require of it?

1. Paid-in capital stock of $5,000,000 and initial free surplus of $5,000,000, financial guaranty insurance being treated for this purpose as though it were the all line category described in section 409 of the Insurance Code.
2. Paid-in capital stock of $2,500,000 and initial free surplus of $2,500,000, the same figures the table sets for multiple line insurers, with an additional deposit of $500,000 to be held by the superintendent.
3. Paid-in capital stock of $47,500,000 and initial free surplus of $2,500,000, the larger of the two figures attaching to the capital because the exposure under a financial guaranty contract is a credit exposure.
4. Paid-in capital stock of $2,500,000 and initial free surplus of $47,500,000, which is the one place in this particular section of the Maine Insurance Code where the two money columns differ sharply from one another. ✓

Why: 24-A M.R.S. s 410(1): an insurer may qualify to transact SOLELY FINANCIAL GUARANTY INSURANCE as defined in s 709-A if it possesses and maintains PAID-IN CAPITAL STOCK OF $2,500,000 AND INITIAL FREE SURPLUS OF $47,500,000 (a foreign mutual or reciprocal: basic surplus of $2,500,000 and the same initial free surplus). It is the one place in the section where the capital and the surplus figures differ sharply.

What bond must a consultant file and maintain under 24-A M.R.S. s 1464?

1. A bond issued by an authorized surety insurer in this State, continuous in form and providing for aggregate liability of $10,000, filed with the licence application and maintained in effect for so long as the licence continues.
2. A bond or an irrevocable letter of credit in the amount of $20,000, the form being at the consultant's election provided the instrument is issued by an institution authorized to do business in this State and approved by the superintendent.
3. A bond issued by an authorized surety insurer in this State, continuous in form and providing for aggregate liability of $20,000 filed with the licence application and maintained in effect while the licence is held without more. ✓
4. A bond in an amount fixed by the superintendent by rule, having regard to the volume of consulting business transacted and the kinds of insurance covered by the licence, but not exceeding $20,000 in aggregate liability.

Why: 24-A M.R.S. s 1464(1): every applicant for a consultant licence shall FILE WITH THE LICENSE APPLICATION AND MAINTAIN IN EFFECT WHILE LICENSED a bond ISSUED BY AN AUTHORIZED SURETY INSURER IN THIS STATE, CONTINUOUS IN FORM AND PROVIDING FOR AGGREGATE LIABILITY OF $20,000. The figure is fixed by the statute, not by rule.

Within what time must a producer account for and pay RETURN premiums under 24-A M.R.S. s 1449, and from when does the time run?

1. Within 30 days from the date of receipt - the date the money is actually received, or the date the credit is posted by the insurer to the licensee's account - by paying the insured or applying them to the insured's outstanding balances. ✓
2. Within 30 days from the date on which the policy is cancelled or the premium is otherwise adjusted, the date of receipt of the money by the licensee being immaterial to the running of the period under the subsection.
3. Promptly, and in accordance with the contract between the licensee and the insurer, the section prescribing no fixed period for return premiums any more than it does for premiums payable to the insurer itself.
4. Within 15 days from the date of receipt, which is the same period within which an insurer must send a producer a copy of a termination notification under section 1420-N, subsection 4 of the Insurance Code.

Why: 24-A M.R.S. s 1449(1): the licensee shall ACCOUNT FOR AND PAY THE RETURN PREMIUMS TO THE INSURED OR APPLY THEM TO OUTSTANDING BALANCES of any insured WITHIN 30 DAYS FROM THE DATE OF RECEIPT, and THE DATE OF RECEIPT IS THE DATE THE MONEY IS ACTUALLY RECEIVED OR THE DATE THE CREDIT IS POSTED by the insurer to the licensee's account. Contrast s 1449(2): premiums owed TO THE INSURER are accounted for PROMPTLY and IN ACCORDANCE WITH THE CONTRACT - no figure.

What is an 'adverse action' for the purposes of 24-A M.R.S. s 2169-B?

1. A denial or cancellation of insurance applied for, the definition being confined to decisions that leave the consumer without the coverage sought and not extending to an increase in the premium charged or to a change in the terms on which coverage is offered.
2. A denial or cancellation of, an increase in any charge for, or a reduction or other adverse or unfavorable change in the terms of coverage or amount of any insurance, existing or applied for, in connection with the underwriting of personal insurance. ✓
3. Any decision of an insurer that a consumer regards as unfavourable, whether or not it affects the coverage or the premium, the definition turning on the consumer's own view of the decision rather than on any objective test stated in the section.
4. A decision to decline a risk that the superintendent has found to be unsupported by the insurer's filed underwriting rules, so that an action taken in accordance with those rules is not an adverse action however unfavourable to the consumer it may be.

Why: 24-A M.R.S. s 2169-B(1)(A) defines ADVERSE ACTION as A DENIAL OR CANCELLATION OF, AN INCREASE IN ANY CHARGE FOR, OR A REDUCTION OR OTHER ADVERSE OR UNFAVORABLE CHANGE IN THE TERMS OF COVERAGE OR AMOUNT of any insurance, EXISTING OR APPLIED FOR, in connection with the UNDERWRITING OF PERSONAL INSURANCE. It reaches rate increases and changes in terms, not only refusals of coverage.

How explicit must the reason for a property nonrenewal be under 24-A M.R.S. s 3051?

1. The reason must be stated in the insurer's own words but need not be explicit, the section requiring only that the insured be told in general terms why the property policy is not being renewed so that other coverage can be sought in good time.
2. The reason must be one of the ten grounds for cancellation set out in section 3049, no other reason being available to an insurer that wishes to decline renewal of a property policy at its expiration date in this State.
3. The reason must be filed with the superintendent, who reviews it for sufficiency before the notice may be sent, and an insurer may use a general expression such as underwriting experience once the superintendent has approved the filing.
4. The reason must be explicit: underwriting reasons, underwriting experience, loss record, location of risk and credit report are not by themselves acceptable; and it must be a good faith reason related to insurability of the property. ✓

Why: 24-A M.R.S. s 3051: THE REASON OR REASONS FOR THE INTENDED NONRENEWAL MUST ACCOMPANY THE NOTICE AND MUST BE EXPLICIT. EXPLANATIONS SUCH AS 'UNDERWRITING REASONS', 'UNDERWRITING EXPERIENCE', 'LOSS RECORD', 'LOCATION OF RISK' AND 'CREDIT REPORT' AND SIMILAR INSURANCE TERMS ARE NOT BY THEMSELVES ACCEPTABLE EXPLANATIONS. THE REASON MUST BE A GOOD FAITH REASON AND RELATED TO THE INSURABILITY OF THE PROPERTY OR A GROUND FOR CANCELLATION PURSUANT TO SECTION 3049. Note that a s 3049 ground is one route, not the only route.

How recent must a credit report or insurance score be before an insurer takes an adverse action on it, under 24-A M.R.S. s 2169-B(2)(F)?

1. It must have been issued or calculated within 30 days before the date the adverse action is taken, thirty days being the same period the section allows an insurer to reunderwrite and rerate a consumer after notice of corrected credit information.
2. It must have been issued or calculated within 12 months before the date the adverse action is taken, twelve months being the interval at which the section entitles an insured to demand that the insurer obtain an updated report and rescore the risk.
3. It must have been issued or calculated within 90 days before the date the policy is first written or the renewal is issued. ✓
4. It must have been issued or calculated at some time during the current policy period, the paragraph fixing no period in days and leaving the currency of the report to be judged against the term of the policy on which the action is taken.

Why: 24-A M.R.S. s 2169-B(2)(F): an insurer may not take an adverse action based on credit information UNLESS it obtains and uses a CREDIT REPORT ISSUED or an INSURANCE SCORE CALCULATED WITHIN 90 DAYS BEFORE THE DATE THE POLICY IS FIRST WRITTEN OR RENEWAL IS ISSUED. The clock runs from the writing or renewal, not from the adverse action. The 30-day figure is subsections 5 and 5-A; the 12-month figure is subsection 5-A.

To what claims does 24-A M.R.S. s 2436-A NOT apply, and what does it leave untouched?

1. It does not apply to claims under a policy of long-term care insurance, which is the exclusion the Title applies to the prompt payment section in the same chapter, and it displaces every other remedy the insured might otherwise have had against the insurer.
2. It does not apply to claims under a commercial policy issued to a large commercial policyholder, whose sophistication the chapter treats as making the statutory protections unnecessary, and it is the exclusive remedy for any insured to whom it does apply.
3. It does not apply to claims involving medical malpractice, fidelity, suretyship or boiler and machinery insurance, which are the classes the Title excludes from its unfair claims provisions generally, and it bars any common law action for the same conduct.
4. It does not apply to workers' compensation claims; and nothing in the section prohibits any other claim or cause of action a person has against an insurer. ✓

Why: 24-A M.R.S. s 2436-A(4): THIS SECTION DOES NOT APPLY TO WORKERS' COMPENSATION CLAIMS. Subsection 3: NOTHING IN THIS SECTION PROHIBITS ANY OTHER CLAIM OR CAUSE OF ACTION A PERSON HAS AGAINST AN INSURER - it adds a remedy, it does not replace one. The longer exclusion list in the fourth option (workers' compensation, medical malpractice, fidelity, suretyship, boiler and machinery) is s 2164-D(9), the chapter 23 section.

The Spoilage endorsement primarily covers:

1. Theft of packaged inventory from a walk-in cooler
2. Damage to the building's refrigeration room structure
3. Spoilage of perishable stock due to power outages or equipment breakdown ✓
4. Liability for customer illness caused by contaminated food sold

Why: The Spoilage endorsement covers loss to perishable stock from breakdown of refrigeration equipment or off-premises power interruption, depending on options selected.

Which factors may an insurance score NOT be calculated on under 24-A M.R.S. s 2169-B(2)(A)?

1. Race, sex, religion, ancestry or national origin and marital status of a consumer, the paragraph leaving income, address and zip code available to the insurer because those are territorial and financial rather than personal characteristics of the consumer.
2. Race, sex, sexual orientation, religion and national origin alone, the paragraph being confined to the characteristics protected by the Maine Human Rights Act and adding nothing of its own to the list that Act already sets out for other purposes.
3. Race, sex, sexual orientation, gender identity, religion, ancestry or national origin, income, address, zip code or marital status of a consumer. ✓
4. Any factor whatever other than the consumer's payment history and outstanding balances, the paragraph stating the two permitted inputs to an insurance score rather than listing the characteristics on which a score may not be based in this State.

Why: 24-A M.R.S. s 2169-B(2)(A) forbids an insurance score calculated using RACE, SEX, SEXUAL ORIENTATION, GENDER IDENTITY, RELIGION, ANCESTRY OR NATIONAL ORIGIN, INCOME, ADDRESS, ZIP CODE OR MARITAL STATUS as a factor. ADDRESS AND ZIP CODE ARE ON THE LIST. Territory is rated under the rating provisions of the Title, not fed into a credit-based insurance score.

Which kinds of insurance does 24-A M.R.S. s 2002-A(1) say must be procured from AUTHORIZED insurers and are NOT eligible for export?

1. Life insurance; health insurance except disability insurance; employee benefit excess insurance; and workers' compensation insurance. ✓
2. Life insurance and health insurance of every kind, including disability insurance, the subsection making no distinction among the health lines and treating them all as business that must be written by an insurer holding a certificate of authority in this State.
3. Workers' compensation insurance and employer's liability insurance alone, the subsection leaving life and health business to be exported on the same diligent-search conditions that apply to any other class of insurance under section 2004 of this chapter.
4. Life insurance, health insurance and title insurance, with a proviso allowing export of any of them where the superintendent finds after a hearing that no reasonable market for the coverage exists among the insurers authorized to write it in this State.

Why: 24-A M.R.S. s 2002-A(1): LIFE insurance (A); HEALTH insurance, EXCEPT DISABILITY INSURANCE (B); EMPLOYEE BENEFIT EXCESS insurance (C); and WORKERS' COMPENSATION insurance (D) must be procured from authorized insurers and are NOT ELIGIBLE FOR EXPORT. Disability insurance is the carve-out inside the health line and is exportable.

What does 24-A M.R.S. s 2169-B(2)(E) say about an ABSENCE of credit information or an inability to calculate an insurance score?

1. The insurer must treat the consumer as having a neutral or average insurance score, calculated as the mean score of the insurer's book of business in the line concerned for the calendar year preceding the one in which the policy is written or renewed.
2. The insurer may not consider it, the number of inquiries, or the inability to score, unless the insurer has demonstrated to the superintendent that it is a relevant factor to the risk and applies it in a manner approved by the superintendent. ✓
3. The insurer may consider it freely, an absence of credit information being a fact about the consumer rather than credit information within the meaning of the section, and the number of inquiries standing on the same footing for the same reason.
4. The insurer must obtain a consumer report from a second consumer reporting agency before acting, and may consider the absence of credit information only if the second agency is also unable to produce a report or to calculate a score for that consumer.

Why: 24-A M.R.S. s 2169-B(2)(E): an insurer may not consider AN ABSENCE OF CREDIT INFORMATION, THE NUMBER OF INQUIRIES or AN INABILITY TO CALCULATE AN INSURANCE SCORE in underwriting or rating personal insurance UNLESS the insurer has DEMONSTRATED TO THE SUPERINTENDENT that it is a RELEVANT FACTOR to the risk underwritten or rated AND the insurer APPLIES THIS FACTOR IN A MANNER APPROVED BY THE SUPERINTENDENT. It is a rebuttable prohibition, not an absolute one.

What antifraud plan does 24-A M.R.S. s 2186 require, and of whom?

1. Every insurer, and every agency or producer acting on behalf of an insurer, must prepare and implement an antifraud plan within 6 months, and file it with the superintendent for approval before it is put into effect.
2. Every insurer writing direct insurance must prepare an antifraud plan and file it with the superintendent annually with the March 1st fraud report, the superintendent approving it before the insurer may implement it.
3. Every insurer must prepare an antifraud plan, the superintendent prescribing its contents by rule, and a reinsurer is included because the definition of insurer in the section expressly extends to reinsurers.
4. Every insurer writing direct insurance must prepare and implement one within 6 months of the effective date of the Act; it does not apply to any agency, producer or other person acting on behalf of an insurer. ✓

Why: 24-A M.R.S. s 2186(5): WITHIN 6 MONTHS of the effective date of the Act, EVERY INSURER WRITING DIRECT INSURANCE shall PREPARE AND IMPLEMENT AN ANTIFRAUD PLAN. THIS SUBSECTION DOES NOT APPLY TO ANY AGENCY, PRODUCER OR OTHER PERSON ACTING ON BEHALF OF AN INSURER. The superintendent MAY REVIEW the plan for compliance - there is no prior approval requirement.

How soon after a revocation may the superintendent issue a new licence under 24-A M.R.S. s 1418?

1. Not until at least one year has expired from the effective date of the revocation in every case, an appeal by the licensee neither extending that period nor postponing the date from which it begins to run at all.
2. Not until at least one year has expired from the effective date of the revocation; and if the licensee appeals, not until at least one year from the date of a final court order affirming that revocation. ✓
3. Not until at least two years have expired from the effective date of the revocation, or from the date of a final court order affirming it where the licensee has pursued an appeal against the superintendent's decision.
4. Not until at least one year has expired from the date on which the licensee ceased to participate in the conduct of any insurance business entity, as required by section 1412 of the Insurance Code.

Why: 24-A M.R.S. s 1418(1): the superintendent MAY NOT ISSUE A LICENSE to a person whose licence has been revoked UNTIL AT LEAST ONE YEAR HAS EXPIRED FROM THE EFFECTIVE DATE OF THAT REVOCATION. IF THE LICENSEE PURSUES AN APPEAL, the superintendent MAY NOT CONSIDER ISSUANCE UNTIL AT LEAST ONE YEAR FROM THE DATE OF A FINAL COURT ORDER AFFIRMING the revocation. An appeal moves the start of the year, it does not shorten it.

Which Dwelling Policy coverage reimburses the owner for lost rents when a rented dwelling becomes uninhabitable due to a covered loss?

1. Coverage D — Fair Rental Value ✓
2. Coverage B — Other Structures
3. Coverage E — Additional Living Expense
4. Coverage C — Personal Property

Why: Coverage D — Fair Rental Value pays the landlord for lost rental income when the rented premises cannot be used because of a covered peril.

The coinsurance formula for the amount payable is:

1. Loss × Coinsurance percentage, minus deductible
2. (Amount required ÷ Amount carried) × Loss, plus deductible
3. Loss ÷ Coinsurance percentage, then minus deductible
4. (Amount carried ÷ Amount required) × Loss, then minus deductible ✓

Why: Payment = (insurance carried ÷ insurance required) × loss, minus any deductible, never exceeding the policy limit.

When is a NON-UNITED STATES insurer considered eligible under 24-A M.R.S. s 2007(5)?

1. When it maintains capital and surplus of at least $15,000,000 and has appointed the superintendent as its attorney for service of process in this State, the alien insurer being subject to the same financial test as a United States surplus lines insurer.
2. When it has established a trust fund in a qualified United States financial institution in an amount at least equal to its outstanding liabilities on business written in this State, reported to the superintendent quarterly by the trustee of the fund.
3. When it is listed on the quarterly listing of alien insurers maintained by the national association of insurance commissioners - eligibility following from the listing itself, with no capital and surplus test applied to it by this section at all. ✓
4. When the superintendent has made an affirmative finding of acceptability on the factors set out in subsection 4, no alien insurer being eligible as of right and each requiring an individual determination before it may be used in this State.

Why: 24-A M.R.S. s 2007(5): a NON-UNITED STATES insurer IS CONSIDERED ELIGIBLE to write insurance on a nonadmitted basis in this State IF IT IS LISTED ON THE QUARTERLY LISTING OF ALIEN INSURERS MAINTAINED BY THE NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS. The capital and surplus tests in subsections 3 and 4 apply to UNITED STATES insurers.

Compensation for pain and suffering, which cannot be precisely measured, is classified as:

1. Special damages
2. General damages ✓
3. Liquidated damages
4. Punitive damages

Why: General damages cover intangible, non-economic losses such as pain, suffering, and disfigurement.

A general contractor requires its subcontractor to name it as an additional insured. The PRIMARY benefit to the general contractor is:

1. A warranty from the subcontractor that its work and materials will stay free of defects for one year
2. A lower experience modification factor on the general contractor's workers compensation
3. Coverage under the sub's policy for the GC's vicarious liability arising from the sub's work ✓
4. A reduced premium for the subcontractor, which the GC recovers in the bid price

Why: As an additional insured on the sub's policy, the GC obtains coverage for liability arising out of the subcontractor's operations.

A peril is best described as:

1. A condition that increases the chance of loss
2. The reduction in value of property
3. The legal obligation to pay for a loss
4. The cause of a possible loss, such as fire or theft ✓

Why: A peril is the direct cause of a loss, such as fire, windstorm, or theft. A hazard increases the likelihood of a peril causing loss.

How does 24-A M.R.S. s 404 direct the superintendent to enforce the certificate of authority requirement?

1. By referring every suspected violation to the Attorney General for criminal prosecution under subsection 4, no civil or injunctive remedy being available to the superintendent under this particular section.
2. By order to cease and desist issued after a hearing held under section 229, the superintendent having no power to seek an injunction until such an order has been made and has been disobeyed by the insurer.
3. Through any and all of the available and lawful means that there are, including but not limited to the enjoining of any violation of this section, or of any violation of it that is merely threatened. ✓
4. By suspension or revocation of the certificate of authority of any insurer found to have violated the section, that being the only sanction the section itself places in the superintendent's hands.

Why: 24-A M.R.S. s 404(3): the superintendent SHALL ENFORCE THIS SECTION THROUGH ANY AND ALL AVAILABLE AND LAWFUL MEANS, INCLUDING, BUT NOT LIMITED TO, THE ENJOINING OF ANY VIOLATION OR THREATENED VIOLATION. An injunction is available at once and a THREATENED violation is enough - no prior order and no prior hearing is required by this subsection.

Under TRIA, insurers writing certain commercial property and casualty lines must:

1. Deny any claim arising from a certified act of terrorism and refer the insured to Treasury for payment
2. Attach a mandatory terrorism exclusion to every commercial policy they issue in that state
3. Provide flood coverage at no extra charge on each commercial property policy written
4. Make available (offer) coverage for certified acts of terrorism to policyholders ✓

Why: TRIA requires participating insurers to make terrorism coverage available to commercial policyholders, though the insured may decline it.

To whom does subchapter V of 24-A M.R.S. ch. 16 apply, under s 1461?

1. To consultants as defined in section 1402 and 'consultant' in the subchapter means both property and casualty consultants and life and health consultants without more as the section has it under that licence. ✓
2. To property and casualty consultants only, life and health consultants being licensed and regulated under the separate provisions of subchapter vi, which deals with adjusters and with life and health advisory work.
3. To consultants and to producers who charge a fee for advice, the subchapter reaching any licensee who takes a fee from a client rather than a commission from an insurer for the same piece of business.
4. To consultants as defined in section 1420-A, the definitions section of the Maine Producer Licensing Act, which is the definitions provision that governs the whole of chapter 16 including this subchapter.

Why: 24-A M.R.S. s 1461(1): this subchapter APPLIES TO CONSULTANTS AS DEFINED IN SECTION 1402. s 1461(2): unless the context otherwise requires, CONSULTANT as used in this subchapter means BOTH PROPERTY AND CASUALTY CONSULTANTS AND LIFE AND HEALTH CONSULTANTS as defined in s 1402. Note the definitions section is 1402, not 1420-A - 1420-A governs subchapter I-A.

A PAP liability limit shown as 100/300/50 means:

1. $100,000 per person BI, $300,000 per accident BI, $50,000 PD per accident ✓
2. $100,000 of property damage, $300,000 of bodily injury per person, and $50,000 of medical payments
3. $100,000 combined for the whole accident, with the other two figures showing the deductibles
4. $100,000 of total coverage subject to a $300 deductible and a $50 per-claim service charge

Why: Split limits 100/300/50 mean $100,000 bodily injury per person, $300,000 bodily injury per accident, and $50,000 property damage per accident.

Whose insurance contracts does 24-A M.R.S. s 2412-A reach, and which lines does it exclude?

1. Contracts providing property or casualty coverages, or a combination of them, issued to a large commercial policyholder - excluding workers' compensation, medical malpractice, life, health and disability insurance from the definition the section uses. ✓
2. Contracts of every kind issued to a corporation, partnership or other business entity, the section drawing its line by the character of the policyholder rather than by the class of insurance written, so that a large buyer's life and health cover is within it too.
3. Contracts providing property or casualty coverages issued to any commercial policyholder whose annual premium exceeds fifty thousand dollars, no other qualifying criterion being applied and no line of insurance being excluded from the section.
4. Contracts providing workers' compensation and employer's liability coverage to a large commercial policyholder, those being the lines in which a sophisticated buyer most needs freedom from the filing requirements that the section sets aside.

Why: 24-A M.R.S. s 2412-A(1)(A) defines CONTRACT OF INSURANCE for the section as one providing PROPERTY OR CASUALTY INSURANCE COVERAGES OR A COMBINATION of them, EXCLUDING WORKERS' COMPENSATION, MEDICAL MALPRACTICE, LIFE, HEALTH AND DISABILITY INSURANCE.

Dividends paid to the policyholders of a mutual insurer are:

1. Not guaranteed and are a return of surplus ✓
2. Guaranteed each year by contract
3. Taxable as ordinary income to the insured
4. Paid only to the stockholders

Why: Mutual policy dividends are not guaranteed; they represent a return of unused premium and are generally not taxable.

Under 24-A M.R.S. s 2007(4), may the superintendent list an insurer that does not meet the capital and surplus requirement?

1. Yes - on an affirmative finding of acceptability based on the same factors, and there is no floor at all, the superintendent being free to list an insurer of any size whose management and reputation satisfy the standard the subsection sets out.
2. Yes - on an affirmative finding of acceptability based on factors such as quality of management, a parent's capital and surplus, underwriting profit and investment income trends, market availability and record and reputation; but never below $4,500,000. ✓
3. No - the capital and surplus requirement in subsection 3 is absolute, and an insurer that fails it may become eligible only by increasing its capital and surplus and applying afresh for a determination of eligibility by the superintendent.
4. Yes - but only for a single transaction at a time, on the written application of the producer proposing to use the insurer for that risk, and only where no listed insurer has offered terms for the risk within the preceding thirty days.

Why: 24-A M.R.S. s 2007(4): the superintendent MAY list an insurer that does not meet the subsection 3 minimums UPON AN AFFIRMATIVE FINDING OF ACCEPTABILITY, based on such factors as QUALITY OF MANAGEMENT, CAPITAL AND SURPLUS OF ANY PARENT COMPANY, COMPANY UNDERWRITING PROFIT AND INVESTMENT INCOME TRENDS, MARKET AVAILABILITY and COMPANY RECORD AND REPUTATION within the industry. But the superintendent MAY NOT make such a finding if the nonadmitted insurer's capital and surplus is LESS THAN $4,500,000.

What reinstatement right does 39-A M.R.S. s 218(1) give, and how long does the employer's obligation last?

1. On request, reinstatement to the former position in every case, whether or not it remains available, the employer being obliged to displace whoever has filled it; the obligation continuing for 2 years after the date of the injury in every case.
2. On request, reinstatement to any available position for which the employee is qualified, the obligation continuing for the whole of the period during which compensation remains payable to the employee under this Act for that injury.
3. On request, reinstatement to the former position if available and suitable, the obligation continuing until 1 year after the date of injury, or 2 years where the employer has over 50 employees at the place where the employee worked.
4. On request, reinstatement to the former position if available and suitable, and otherwise to any other available suitable position; the obligation continuing until 2 years - or 3 years if the employer has over 200 employees - after the injury. ✓

Why: 39-A M.R.S. s 218(1): when an employee has suffered a COMPENSABLE INJURY, the employee is entitled, UPON REQUEST, TO REINSTATEMENT TO THE EMPLOYEE'S FORMER POSITION IF THE POSITION IS AVAILABLE AND SUITABLE TO THE EMPLOYEE'S PHYSICAL CONDITION; if it is not available or suitable, TO ANY OTHER AVAILABLE POSITION SUITABLE to that condition. s 218(3): THE EMPLOYER'S OBLIGATION TO REINSTATE CONTINUES UNTIL 2 YEARS, OR 3 YEARS IF THE EMPLOYER HAS OVER 200 EMPLOYEES, AFTER THE DATE OF THE INJURY, and an employer that reinstates MAY NOT SUBSEQUENTLY DISCRIMINATE against the employee for asserting a claim or right under the Act.

Beyond the waiting period, what does 24-A M.R.S. s 1418 require of an applicant seeking relicensing after a revocation?

1. The applicant must reestablish qualification for the licence and satisfy the superintendent that the conduct leading to the revocation has been made good, the burden being on the superintendent to show why a licence should be refused.
2. The applicant must reestablish qualification for the licence, the prior revocation ceasing to be relevant once the statutory year has run, so that the application is then dealt with as though it were a first application.
3. The applicant must reestablish qualification for the licence under the applicable provisions of the Title, and the superintendent may refuse the application unless the applicant shows good cause why the prior revocation should not bar a new licence. ✓
4. The applicant must reestablish qualification for the licence and obtain the sponsorship of a licensed resident producer in good standing who assumes responsibility for the applicant's acts for the first year of the new licence.

Why: 24-A M.R.S. s 1418(1): THE LICENSE APPLICANT SHALL REESTABLISH QUALIFICATION FOR THE LICENSE in accordance with the applicable provisions of this Title, and THE SUPERINTENDENT MAY REFUSE ANY SUCH NEW LICENSE APPLICATIONS UNLESS THE APPLICANT SHOWS GOOD CAUSE WHY THE PRIOR REVOCATION SHOULD NOT BE DEEMED A BAR to the issuance of a new licence. The burden is on the applicant.

A 'valued policy law' in some states requires that, for a total loss to real property by a covered peril, the insurer pay:

1. The full face amount of the policy ✓
2. Replacement cost minus depreciation
3. The market value of the land
4. Actual cash value only

Why: Where valued policy laws apply, the insurer must pay the full policy face amount on a total loss of real property by a covered peril, regardless of actual value.

What interest does 24-A M.R.S. s 2436(3) impose on an overdue undisputed claim?

1. Interest at 1 1/2% per month after the due date on the amount of the overdue claim or the overdue part of it; and the superintendent must set by rule a minimum interest amount payable on such a claim to a health care provider. ✓
2. Interest on the overdue claim at the judgment rate fixed by Title 14 from the date the claimant commences an action on the claim, no interest running before suit because the section is concerned with the cost of litigation rather than with the delay in payment itself.
3. Interest at 1 1/2% per year after the due date, compounded annually until the claim is paid in full, the subsection expressing the rate as an annual percentage in the ordinary way rather than as a monthly charge on the outstanding amount.
4. Interest at 6% per month after the due date, the subsection fixing a deliberately punitive rate so that an insurer gains nothing by withholding payment of a claim it has not disputed in the manner subsection 2 requires of it.

Why: 24-A M.R.S. s 2436(3): if an insurer fails to pay an UNDISPUTED CLAIM OR ANY UNDISPUTED PART of it when due, THE AMOUNT OVERDUE BEARS INTEREST AT THE RATE OF 1 1/2% PER MONTH AFTER THE DUE DATE. The superintendent must also adopt routine technical rules setting a MINIMUM AMOUNT OF INTEREST payable on an overdue undisputed claim to a HEALTH CARE PROVIDER before a payment must be issued.

Within what time must an application for a hearing be filed under 24-A M.R.S. s 229, and from when does that time run?

1. Within 30 days after the person knew or reasonably should have known of the act, impending act, failure, report or order, unless a different period is provided by other applicable law, in which case that other law governs. ✓
2. Within 30 days after the act, impending act, failure, report or order actually occurs, the applicant's knowledge of it being immaterial because the Insurance Code fixes a single objective starting point for the period.
3. Within 14 days after the person receives written notice of the act, report or order, the same period the superintendent must give as advance notice of a hearing under section 230 once the application has been granted.
4. Within 6 months after the person knew or reasonably should have known of the act, report or order, that being the period section 236 allows for a petition for review where the superintendent has failed to act.

Why: 24-A M.R.S. s 229(3): the application must be filed WITHIN 30 DAYS AFTER SUCH PERSON KNEW OR REASONABLY SHOULD HAVE KNOWN of the act, impending act, failure, report or order, unless other applicable law provides a different period. Knowledge - actual or constructive - starts the clock, not the event.

Under PAP Part A, which of the following is an "insured" while using a non-owned auto?

1. The named insured and family members for any auto, and others only for the covered auto ✓
2. Any person operating the named insured's vehicle for a fee, such as a valet or mechanic on duty
3. Only the registered owner of the non-owned auto, since that owner's policy is primary
4. Anyone in the world who drives any vehicle with the named insured's verbal or written permission

Why: For Part A, the named insured and family members are insureds for the ownership/use of any auto, while other persons are insureds only for use of the named insured's covered auto.

What does 24-A M.R.S. s 2006(2) require of a producer who places a coverage made eligible for export generally?

1. The producer must file with or as directed by the superintendent a memorandum as to each such coverage placed with a nonadmitted insurer, in the form the superintendent reasonably requires to identify the coverage and determine the tax payable to the State. ✓
2. The producer must file a copy of the policy with the superintendent within thirty days of its delivery to the insured, together with the producer's certificate and evidence that the premium tax on the transaction has been paid to the State Tax Assessor.
3. The producer must report the placement to the insurer's domiciliary regulator and to the National Association of Insurance Commissioners, the superintendent taking the information from the quarterly listing rather than from any filing made by the producer.
4. The producer need file nothing, an order under subsection 1 dispensing with the ordinary reporting as well as with the conditions in section 2004, the tax being collected from the nonadmitted insurer directly under the general law of this State.

Why: 24-A M.R.S. s 2006(2): the producer SHALL FILE WITH OR AS DIRECTED BY THE SUPERINTENDENT A MEMORANDUM as to each such coverage placed with a nonadmitted insurer, in such form and context as the superintendent may reasonably require FOR THE IDENTIFICATION OF THE COVERAGE AND DETERMINATION OF THE TAX PAYABLE TO THE STATE.

What do the ASSIGNMENT, PRO RATA LIABILITY and SUBROGATION conditions of the Maine standard fire policy provide?

1. Assignment is valid on written notice to the company; the company is liable for a proportion of the loss measured against the collectible insurance only, so that an insolvent co-insurer's share falls on the remaining insurers rather than on the insured.
2. Assignment is not valid except with the company's written consent; the company is not liable for a greater proportion of any loss than its amount bears to the whole insurance covering the property, whether collectible or not; and it may require an assignment of all right of recovery to the extent of its payment. ✓
3. Assignment is not valid except with the company's written consent; the company is liable in full up to the policy amount whatever other insurance the insured carries; and subrogation is excluded altogether by the standard fire policy in this State.
4. Assignment is not valid except with the company's written consent; the company is not liable for a greater proportion of any loss than its amount bears to the collectible insurance; and subrogation arises only where the insured has been paid in full.

Why: 24-A M.R.S. s 3002(1), ASSIGNMENT CLAUSE: ASSIGNMENT OF THIS POLICY SHALL NOT BE VALID EXCEPT WITH THE WRITTEN CONSENT OF THIS COMPANY. PRO RATA LIABILITY: THIS COMPANY SHALL NOT BE LIABLE FOR A GREATER PROPORTION OF ANY LOSS THAN THE AMOUNT HEREBY INSURED SHALL BEAR TO THE WHOLE INSURANCE COVERING THE PROPERTY AGAINST THE PERIL INVOLVED, WHETHER COLLECTIBLE OR NOT. SUBROGATION: THIS COMPANY MAY REQUIRE FROM THE INSURED AN ASSIGNMENT OF ALL RIGHT OF RECOVERY AGAINST ANY PARTY FOR LOSS TO THE EXTENT THAT PAYMENT THEREFOR IS MADE BY THIS COMPANY.