Life-Producer Exam Dumps - Maryland Life Producer Exam (Series 20-27)

Comprehensive and Detailed Step by Step Explanation:Allowing an applicant to sign a blank or incomplete application (B) violates ethical and legal standards, as it undermines transparency and could lead to disputes about coverage or claims.

Selling insurance to family members (A):Permitted as long as the transactions areconducted ethically and comply with Maryland laws.

Countersigning policies (C):Required in certain situations to validate contracts in Maryland.

Splitting commissions with nonresident producers (D):Permissible under Maryland law, provided both producers are licensed and involved in the transaction.

References:Maryland Insurance Administration Producer Conduct Rules, COMAR 31.03.13, and Ethical Standards for Insurance Producers.

Comprehensive and Detailed Step by Step Explanation:Aninsurable riskmust meet specific criteria to ensure fair and financially viable coverage:

Chance of loss must be calculable (C):Correct. Insurers need statistical data to assess risk and determine premiums.

Loss must be intentional (A):Incorrect; intentional losses are not insurable.

Loss must be catastrophic (B):Incorrect; catastrophic losses (e.g., war or large-scale disasters) are often excluded or managed through reinsurance.

Large number of different loss exposures (D):A large number of similar, not different, exposures is required for risk pooling.

References:Maryland Insurance Principles, Actuarial Standards, and COMAR 31.09.14.

Comprehensive and Detailed Step by Step Explanation:Thedoctrine of reasonable expectationsensures that ambiguities in insurance policies are resolved in favor of the policyholder:

Reasonable expectations (B):Protects policyholders by ensuring contracts are interpreted based on how an average person would understand them, especially when ambiguities exist.

Representation (A):Refers to the accuracy of statements made during application, unrelated to contract interpretation.

Retention (C):Concerns risk management, not contract ambiguities.

Retrocession (D):Deals with reinsurance, not policyholder rights.

References:Maryland Contract Law, Insurance Ambiguities Guidelines, and COMAR 31.15.03.