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 a licensed broker reviews the file within 30 days
c.Allowed because cover notes are not formal policies
d.Allowed if the customer signs a written waiver
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.
Related questions on this topic
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