State RegulationsGA specificDifficulty 2/5
Under Georgia law, which of the following activities constitutes 'transacting the business of insurance'?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
Under O.C.G.A. § 33-1-2, transacting the business of insurance is not limited to issuing policies: it includes solicitation or inducement, preliminary negotiations, and the effectuation of a contract of insurance, among other activities. Because the definition sweeps in early sales activity, unlicensed or unauthorized persons who solicit or negotiate coverage in Georgia fall under the Insurance Commissioner's regulatory and enforcement authority.
Why the other options are wrong
- A) Under O.C.G.A. § 33-1-2, solicitation and negotiation are themselves part of the insurance transaction; waiting for issuance draws the line too late.
- B) The definition covers activities by producers and others as well as insurer personnel; it is not limited to home-office employees.
- D) Claim payment is one incident of an insurance contract, but the statutory definition reaches the solicitation, negotiation, and creation of the contract long before any claim exists.
Memory hook
The deal begins at the first knock — that is already transacting.