The designated responsible producer of an incorporated insurance agency discovers that two junior agents have been secretly altering applicants' medical histories on submitted life insurance applications. The responsible producer immediately terminates both employees but deliberately conceals the fraudulent incident from the state Department of Insurance to prevent public embarrassment. When the regulator eventually uncovers the fraud, which of the following disciplinary actions is the state most likely to take regarding the agency?
- The agency's business entity license may be suspended or revoked because the responsible producer knew of the violation and failed to report it.Cevap
- BThe agency is shielded from license discipline because the junior agents were acting entirely outside of their express and implied authority.
- CThe agency will only face a monetary fine, provided the responsible producer unilaterally corrects the applicants' medical histories to reflect the truth.
- DThe agency will receive a minor penalty for simply missing the 30-day administrative deadline to report a change in employee address or status.
Cevap
The agency's business entity license may be suspended or revoked because the responsible producer knew of the violation and failed to report it.
State insurance regulations typically stipulate that a business entity's license can be suspended, revoked, or refused if the Commissioner finds that an individual licensee's violation was known by a partner, officer, or designated manager who failed to report it to the Department of Insurance or take appropriate corrective action.
Adım Adım Çözüm
Anahtar Kavram
Business Entity License Discipline