State RegulationsNC specificDifficulty 1/5
During a market-conduct examination, a North Carolina replacing insurer is asked to produce its Notices Regarding Replacement. Under 11 NCAC 12 .0612(a)(3), how must the insurer keep these records so they can be produced on request?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Under 11 NCAC 12 .0612(a)(3), a replacing insurer must be able to produce copies of the Notice Regarding Replacement on request, and the rule keys the filing system to the producer: the notices must be indexed by producer and kept for at least 5 years or until the next regular examination by the domicile regulator, whichever is later. Producer-level indexing is what lets an examiner pull every replacement transaction tied to a given agent.
Why the other options are wrong
- B) Policy-number indexing is not what the rule prescribes; the organizing key is the producer.
- C) Indexing by existing insurer is not the required system under .0612(a)(3).
- D) Geographic indexing by county appears nowhere in the replacement records rule.
Memory hook
File replacement notices by producer - that is the examiner's key.