New Jersey Life Producer Law Practice Test

Under what circumstance may the Banking and Insurance Commissioner revoke a producer's license?

1. Failure to complete continuing education

2. Deposits commission in a trust account

3. Conviction of a felony

4. Submitting false information during the application process

The correct answer is: Deposits commission in a trust account

The circumstance under which the Banking and Insurance Commissioner may revoke a producer's license involves engaging in unethical or illegal practices. In this case, submitting false information during the application process is a serious violation of the standards expected from licensed producers. This practice undermines the integrity of the insurance industry and erodes consumer trust. Licensing bodies require accurate and truthful information to assess the qualifications and suitability of individuals seeking to operate in the insurance marketplace. Providing false information can lead to significant consequences, including the revocation of a license, as it demonstrates a lack of honesty and can be viewed as fraud. While failing to complete continuing education can lead to disciplinary action, it's unlikely to result in an immediate revocation compared to acts of dishonesty or criminal behavior. Depositing commissions into a trust account is a standard practice that, when done properly, would not typically result in revocation. Conviction of a felony can also lead to a license being revoked, particularly if it relates to the duties of the insurance producer. However, submitting false information is directly related to the integrity of the application process itself and is an act that can most immediately trigger revocation.