Which regulation should an insurance agent consult when a customer wants to exchange an old contract for a new one?

Which regulation should an insurance agent consult when a customer wants to exchange an old contract for a new one?

• A. The California Insurance Code
• B. The National Association of Insurance Commissioners Guidelines
• C. The Florida Replacement Rule
• D. The Federal Trade Commission Act

Answer: (C)

In scenarios where a customer is looking to exchange an old insurance contract for a new one, the most relevant regulation to consider is the Florida Replacement Rule. This rule is specifically designed to provide guidelines and protections when it comes to the replacement of life insurance policies or annuities. The purpose of this regulation is to ensure that consumers are fully informed about the implications of replacing their current policies, including any potential loss of benefits or coverage that may occur. The Florida Replacement Rule requires agents to provide a comparison of the old and new contracts, to inform the client of their rights, and to obtain the necessary disclosures from the client regarding the replacement. This helps protect consumers from making unwarranted decisions that might not be in their best financial interests due to inadequate understanding of their existing and new policies. There are several other regulations and codes that apply to insurance practices, but the Florida Replacement Rule directly addresses the specific context of replacing insurance contracts in Florida, making it the most appropriate choice in this situation.

In scenarios where a customer is looking to exchange an old insurance contract for a new one, the most relevant regulation to consider is the Florida Replacement Rule. This rule is specifically designed to provide guidelines and protections when it comes to the replacement of life insurance policies or annuities. The purpose of this regulation is to ensure that consumers are fully informed about the implications of replacing their current policies, including any potential loss of benefits or coverage that may occur.

The Florida Replacement Rule requires agents to provide a comparison of the old and new contracts, to inform the client of their rights, and to obtain the necessary disclosures from the client regarding the replacement. This helps protect consumers from making unwarranted decisions that might not be in their best financial interests due to inadequate understanding of their existing and new policies.

There are several other regulations and codes that apply to insurance practices, but the Florida Replacement Rule directly addresses the specific context of replacing insurance contracts in Florida, making it the most appropriate choice in this situation.