State RegulationsCA specific✓ Verified · outline & fact-checked · Sep 2026Difficulty 2/5
An agent repeatedly completes life insurance policy replacements without providing the required written notice to the applicant and the existing insurer. Under California law, this conduct can result in:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
California's replacement regulations (CIC Section 10509 et seq.) require the replacing insurer and its agent to give the applicant a written notice and to provide the existing insurer a copy. Failure to comply is a violation subject to disciplinary action by the Insurance Commissioner, including license suspension or revocation. The applicant's verbal approval does not cure the violation because the statutory notice exists to let the applicant compare policies with full information.
Why the other options are wrong
- B) The violation is a regulatory matter enforced by the Commissioner; it is not limited to a private suit by the new insurer.
- C) Nothing in the law automatically renews the replaced policy; the replaced policy simply lapses once the replacement takes effect.
- D) Applicant approval does not waive the statutory notice; the notice requirement is a mandatory consumer-protection disclosure.
Memory hook
Skip the replacement notice and the Commissioner may skip your license.