Before buying auto insurance in California, the manual says to confirm that the agent, broker, or provider is:
-
A.
Licensed by the California Department of Insurance. Correct
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B.
Rated A or higher by a national ratings service.
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C.
Registered with the DMV as an insurance provider.
The answer is "Licensed by the California Department of Insurance."
The manual tells you to confirm your agent, broker, or provider is licensed by the California Department of Insurance. Answer C routes every driving-related check through DMV, missing that a separate state agency oversees the insurance business itself.
The traps in the wrong answers
B. Rated A or higher by a national ratings service.
Financial ratings are not the check the manual names for California drivers. This answer pulls in a consumer-guide habit about ratings services instead of the licensing check California actually requires.
C. Registered with the DMV as an insurance provider.
DMV registers vehicles and licenses drivers; insurance providers are licensed by a different state agency. This answer routes every driving-related check through DMV, missing that a separate state agency oversees insurance.
This question tests your knowledge of Insurance & Financial Responsibility in California. Source: California Driver Manual, "Insurance Requirements," p.76..
Related California questions
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