Oklahoma Bonding Association Practice Exam

Which appointment term is true?

It lasts for one year It lasts indefinitely It remains in effect until cancellation, expiration, or commissioner action It ends when the insurer changes product

Correct Answer:

It remains in effect until cancellation, expiration, or commissioner action

Explanation:

Appointments between an insurer and a producer aren’t tied to a fixed calendar term. The appointment remains in effect until something ends it: the insurer cancels the appointment, the appointment expires under its own terms, or the insurance commissioner takes action (such as suspending or revoking the appointment). This means that simply changing a product line doesn’t automatically terminate the appointment—the producer can still be authorized to represent the insurer’s other products unless the insurer specifically cancels the appointment or regulatory action occurs.

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