Florida Insurance Exam

The clause identifying which losses resulting from an accident or sickness are insured by the policy is called the:

Insuring clause

K applies for a life insurance policy on herself and submits the initial premium with the application. She is given a receipt by the agent stating that coverage begins immediately if the application is approved. What kind of receipt was used?

Conditional

A life insurance arrangement which circumvents insurable interest statutes is called:

Investor-Originated Life Insurance

Which of the following health policy provisions states that the producer does NOT have the authority to change the policy or waive any of its provisions?

Entire Contract

Within how many days after policy delivery can a Medicare Supplement policy be returned for a 100% premium refund?

30

Which of the following is NOT an unfair claim settlement practice?

Needing written documentation of claim details

Who is NOT required to sign a life insurance application?

Beneficiary

To be eligible for Social Security disability benefits, an employee must be unable to perform:

any occupation

The type of annuity that can be purchased with one monetary deposit is called a(n):

Immediate annuity

A life insurance application must be signed by all of these, EXCEPT:

beneficiary

Which of the following is considered an accurate statement of an unfair trade practice?

Twisting involves an agent using misrepresentation to convince a policyowner to cancel their current policy so that they can purchase a new life insurance policy with another company

The Accelerated Death Benefit provision in a life insurance policy is also known as a(n):

Living Benefit

Which of the following policy features allows an insured to defer current health charges to the following year's deductible instead of the current year's deducitble?

Carryover provision

Insurance policies are considered aleatory contracts because

performance is conditioned upon a future occurrence

Within how many days must a licensee notify the Department of Financial Services of a change in address?

30

Which organization was established to provide funds to protect an insured in the event of an insurer's insolvency?

Florida Life and Health Insurance Guaranty Association

The clause in an Accident and Health policy which defines the benefit amounts the insurer will pay is called the:

Insuring clause

When a policyowner cash surrenders a Universal Life insurance policy in it's early years, this may be considered a red flag for a(n):

Anti-Money Laundering violation

According to the Time Payment of Claims provision, the insurer must pay Disability Income benefits no less frequently than which of the following options?

Monthly

What would the Medical Information Bureau (MIB) identify?

Testing positive for marijuana use from a previous screening

How would a contingent beneficiary receive the policy proceeds in an Accidental Death and Dismemberment (AD&D) policy?

If the primary beneficiary dies before the insured

Under a Renewable Term policy,

the renewal premium is calculated on the basis of the insured's attained age

Which of the following statements is true about most Blue Cross/Blue Shield organizations?

They are nonprofit organizations

If a policyowner does not pay the premium by the due date, the

policyowner can make the premium payment during the grace period

According to Florida law, which of the following information does NOT need to be obtained by an agent recommending an annuity purchase?

Marital status

Which of these characteristics is consistent with a Straight Life policy?

Premiums are payable for as long as there is insurance coverage in force

P completes an application for a $10,000 life policy, but does not give the producer the initial premium. P's coverage becomes effective when:

P receives the policy and pays the premium

On August 6, D submitted an application for a $50,000 Life Insurance policy and did not pay the initial premium. On August 18, D went to his doctor complaining of chest pains and some tests were given by the doctor. The life policy was delivered by the producer on August 20 and D explains what had recently taken place with the doctor. What action should the producer then take?

Collect initial premium along with a signed health statement

A life insurance policyowner may sell their policy to a(n) _____ in order to receive a percentage of the policy's face value.

viatical settlement provider

According to Florida law, when must an agent deliver the Outline of Coverage to a Medicare Supplement applicant?

At the time of application

Which of the following statements about accumulated interest earned on dividends from an insurance policy is TRUE?

It is taxed as ordinary income

The automatic premium loan provision is designed to:

avoid a policy lapse

A term life insurance policy matures:

upon the insured's death during the term of the policy

What kind of insurance policy supplies an income stream over a set period of time that starts when the insured dies?

Family Maintenance Policy

The guarantee of insurability option provides a long-term care policyowner the ability to:

buy additional coverage at a later date

When determining the monthly benefit amount for a Disability Income policy, the factor that limits the amount a prospective insured may purchase is:

income

Periodic health claim payments MUST be made at least:

monthly

Which type of plan allows an employer to give money to an employee for buying a life insurance policy and also permits the employee to select the beneficiary?

Split-dollar plan

T is an agent and when hired, is reminded that he has a responsibility to handle clients' funds in an honest and ethical manner. This responsibility is referred to as

fiduciary responsibility

J is an agent who recently told a claimant that his rights might be impaired if he does not complete a release form within a specified time. What could this agent be found guilty of?

Coercion

An example of unfair discrimination would be

offering different terms of coverage for different policyowners having the same risk classification

Which of the following is a characteristic of a variable annuity?

Underlying equity investments

A person insured under a health policy is required to give the insurance company a Notice of Claim within how many days after a covered loss?

Twenty

How many days does an insurance company have to reject a reinstatement application before it is automatically reinstated?

45

The Life and Health Insurance Guaranty Association is

funded by admitted insurance companies through assessments

On January 8, an applicant filled out an application for a life insurance policy but did not include the initial premium. The insurance company approved the application on January 14 and issued the policy January 15. The producer delivered the policy on January 26 and collected the first premium. When did the coverage become effective?

January 26

Which of the following types of insureds are life insurance companies allowed to make policy rate discriminations against?

People that smoke

P and Q are married and have three children. P is the primary beneficiary on Q's Accidental Death and Dismemberment (AD&D) policy and Q's sister R is the contingent beneficiary. P, Q, and R are involved in a car accident and Q and R are killed instantly. The Accidental Death benefits will be paid to:

P only

An insured pays premiums on an annual basis for an individual health insurance policy. What is the MINIMUM number of days for the Grace Period provision?

31

Which of the following services is NOT covered under a hospitalization expense policy?

surgeon's fees

P died five years after purchasing a life policy. While investigating the claim, the insurer discovered material misrepresentations made by P during the application process. Which of these actions will the insurer take?

Beneficiary will be paid the Death Benefit

Employers with less than __ employees are affected by Florida's Health Insurance Coverage Continuation Act (Mini COBRA).

20

What group term life feature permits an individual to depart from the group and continue to be covered without providing evidence of insurability?

Conversion

Which of the following policy provisions prohibits an insurance company from incorporating external documents into an insurance policy?

Entire Contract

The incontestable clause allows an insurer to:

contest a claim during the contestable period

Which of the following employees may NOT be excluded from a group life plan?

Full-time employees after the probationary period

An agent selling Medicare Supplement policies must provide every applicant with a(n)

Suitability form

When replacing or exchanging an annuity, the agent must disclose to the annuitant

the possible tax ramifications as a result of the transaction

The insuring clause

States the scope and limits of the coverage

A stock insurance company

is owned exclusively by its shareholders

Which Accident and Health policy provision addresses preexisting conditions?

Time Limit on Certain Defenses

The Accidental Death and Dismemberment (AD&D) provision in a life insurance policy would pay additional benefits if the insured:

is blinded in an accident

At what time must a policyowner have insurable interest on the insured in order for the life policy to be valid?

At the time of application

A license may be denied, suspended, or revoked if the licensee

is found guilty of misrepresentation

What is the Suicide provision designed to do?

safeguard the insurer from an applicant who is contemplating suicide

Rick recently died and left behind an individual IRA account in his name. His widow was forwarded the balance of the IRA. The widow qualifies for the:

marital deduction

Which of these statements about a Guaranteed Insurability Option rider is NOT TRUE?

Evidence of insurability is required when the option is exercised

B has a $100,000 Accidental Death and Dismemberment policy that pays triple indemnity for common carrier death. If B is killed from an accident on a commercial flight, what will the policy pay B's beneficiary?

$300,000

Which type of policy pays benefits to a policyholder covered under a Hospital Expense policy?

Reimbursement

An example of false advertising would be

An insurer exaggerating its dividends in a magazine advertisement

When does a Probationary Period provision become effective in a health insurance contract?

At the policy's inception

All of these Settlement options involve the systematic liquidation of the death proceeds in the event of the insured's death, EXCEPT:

Interest Only

What is the maximum Social Security Disability benefit amount an insured can receive?

100% of the insured's Primary Insurance Amount (PIA)

P is a Major Medical policyowner who is hospitalized as a result of injuries sustained from participating in a carjacking. How will the insurer most likely handle this claim?

Claim will be denied

P is blinded in an industrial accident. Which provision of his life insurance policy will pay a stated benefit amount?

Accidental Death and Dismemberment clause

Which type of renewability best describes a Disability Income policy that covers an individual until the age of 65, but the insurer has the right to change the premium rate for the overall risk class?

Guaranteed Renewable

T and S are named co-primary beneficiaries on a $500,000 Accidental Death and Dismemberment policy insuring their father. Their mother was named contingent beneficiary. Five years later, S dies of natural causes and the father is killed in a scuba accident shortly afterwards. How much of the death benefit will the mother receive?

$0

Which of the following statements is CORRECT about the period in which a Term Policy can be converted?

It varies according to the contracts

Which of the following is NOT required in the Outline of Coverage for a health insurance policy?

Projection of the policy's future costs

How does a typical Variable Life Policy investment account grow?

Through mutual funds, stocks, bonds

What action should a producer take if the initial premium is NOT submitted with the application?

Forward the application to the insurer without the initial premium

The policy provision that entitles the insurer to establish conditions the insured must meet while a claim is pending is:

Time Limit on Certain Defenses

The minimum age at which a person can sign a life insurance application is

15 years

Which of the following costs would a Basic Hospital/Surgical policy likely cover?

Surgically removing a facial birthmark

Upon reaching the limiting age, a handicapped child can extend their health insurance coverage as a dependent

only if the child is incapable of employment and chiefly dependent on the policyowner

A licensed agent must be appointed by an insurance company to solicit insurance in Florida. The agent's license will terminate if a certain period of time elapses without being appointed. How long is this period of time?

48 months

If an agent would like to sell Variable annuities, which state examination must the agent pass?

Life and Variable contracts

Term insurance has which of the following characteristics?

Expires at the end of the policy period

A policy loan is made possible by which of these life insurance policy features?

Cash value provision

How are surrender charges deducted in a life policy with a rear-end loaded provision?

Deducted when the policy is discontinued

Florida's 14-day free-look period for life insurance policies begins at the

date of delivery

The coordination of benefits (COB) provision exists in order to

avoid duplication of benefit payments

J's Major Medical policy has a $2,000 deductible and an 80/20 Coinsurance clause. If J is hospitalized and receives a bill for $10,000, J would pay:

$3,600

Which of the following employer tasks does a Professional Employer Organization normally handle?

Administration tasks

According to Florida law, group life insurance conversion privileges must NOT

require evidence of insurability

An engineering firm that would suffer financially from the death of a project manager should purchase a:

Key Person Life Policy

A Business Disability Buyout plan policy is designed:

to pay benefits to the Corporation or other shareholders

Medicare Part A and Part B do NOT pay for:

dental work

R had received full disability income benefits for 6 months. When he returns to work, he is only able to resume half his normal daily workload. Which provision pays reduced benefits to R while he is not working at full capacity?

Residual Disability

The Consideration clause in a life insurance contract contains what pertinent information?

Amount of premium payments and when they are due