State RegulationsCA specific✓ Verified · outline & fact-checked · Sep 2026Difficulty 2/5
When selling an annuity to a 70-year-old California consumer, the producer is required by Section 785 to:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Section 785(a) imposes on everyone engaged in the transaction of insurance, including producers selling annuities, a duty of honesty, good faith, and fair dealing toward prospective insureds who are 65 or older. The duty exists in addition to any other express or implied duty and shapes how the producer may market, explain, and sell annuity products to senior consumers. A violation can support an action for breach of the duty of good faith and fair dealing.
Why the other options are wrong
- B) No statute requires a producer to guarantee a rate of return; fixed annuity guarantees are contract features set by the insurer.
- C) Section 785 does not impose a 30-day application-filing deadline on producers.
- D) The senior cancellation period under Section 10127.10 is at least 30 days, not 90 days.
Memory hook
Selling to a senior means honesty, good faith, and fair dealing as a statutory duty, not just good manners.