State RegulationsOH specificDifficulty 2/5
A licensed producer in Toledo persuades a client to purchase a life policy and to name the producer's daughter as the beneficiary. The daughter is not the insured. Under Ohio insurance law, what is the consequence for the producer?
Select an option to reveal the answer and the full 3-part explanation — free, no signup.
Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
Under ORC 3905.14(B)(19) and (B)(20), causing a policyholder to name the producer - or the producer's spouse, parent, child, or sibling - as beneficiary is a disciplinary ground, unless that relative is the insured. The Superintendent may suspend, revoke, or penalize the license for this conduct, protecting policyholders from producer self-dealing.
Why the other options are wrong
- A) Although a policyholder generally may choose any beneficiary, Ohio specifically prohibits a producer from engineering a designation in the producer's own family's favor.
- B) Disclosure to the insurer does not cure the violation; the disciplinary ground attaches to causing the designation, not to whether the insurer was told.
- D) Financial dependence is irrelevant; the prohibition applies regardless of whether the relative depends on the policyholder.
Memory hook
Never steer the death benefit to your own family - license on the line.