California Insurance License Exam Practice Test Practice Question
The purpose of the California Life and Health Insurance Guarantee Association is to:
Correct Answer: A
Rationale: The California Life and Health Insurance Guarantee Association serves to protect policyholders when a member insurer becomes insolvent, ensuring that individuals do not lose their benefits.
Option B is incorrect as it focuses on promises made by sales or marketing units, which is not the Association's role. Option C mischaracterizes the scope of protection, as it specifically applies to member insurers, not non-admitted insurers. Option D suggests a focus on market competition, which does not align with the Association's primary mission of safeguarding policyholder interests in cases of insolvency.
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