California Insurance Code & EthicsQuestion 36 of 158
An unlicensed assistant in a personal lines office quotes an auto policy premium to a walk-in customer and binds coverage by signing a temporary cover note. Under §1631, this conduct is:
a.Prohibited; transacting insurance without a license is unlawful
b.Allowed if the customer signs a written waiver
c.Allowed if a licensed broker reviews the file within 30 days
d.Allowed because cover notes are not formal policies
Explanation
Insurance Code §1631 prohibits any person from soliciting, negotiating, or effecting insurance contracts in California without a license. Quoting premiums and binding coverage are core licensed activities; after-the-fact review by a broker does not cure the violation.
Law Reference: Cal. Ins. Code §1631Practice all 158 questions free — no signup required.
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