State RegulationsNC specificDifficulty 2/5
An insurer terminates a producer for ordinary performance reasons unrelated to any misconduct or dishonesty. Under G.S. 58-33-56, is the insurer still obligated to report the termination to the Commissioner?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
Under G.S. 58-33-56, the notice obligation attaches to every termination of a producer's appointment or employment, whether or not the producer was terminated for cause. The insurer must notify the Commissioner within 30 days after the effective date of the termination and send the producer a copy of the notification within 15 days after making it, which is what enables the producer's written-comment right. Routine performance terminations are covered exactly like misconduct cases.
Why the other options are wrong
- A) For-cause and no-cause terminations are treated alike; the duty attaches to every termination under G.S. 58-33-56.
- B) The insurer, not the producer, bears the reporting duty when it terminates the appointment or employment.
- D) The duty operates automatically upon termination; it does not depend on a request from the producer.
Memory hook
Any termination means notice — for cause or not, the Commissioner hears about it.