Florida 2-15 Insurance License Exam
(2025/2026) – 220+ Expert-Verified
Questions & Correct Answers |
Guaranteed Pass | Latest Updated
Version
1. What is the primary purpose of life insurance?
The primary purpose of life insurance is to provide financial protection to beneficiaries upon
the death of the insured. It helps cover expenses such as funeral costs, outstanding debts,
and lost income, ensuring the beneficiaries maintain financial stability after the insured’s
passing.
2. What does the free-look period allow a policyholder to do?
The free-look period allows a new policyholder to review the insurance policy for a specified
number of days, typically 10 to 30, depending on the state. During this time, the policyholder
can cancel the policy for a full refund without penalty or obligation.
3. How does a whole life insurance policy differ from term life insurance?
Whole life insurance provides lifelong coverage and includes a cash value component that
grows over time. Term life insurance offers coverage for a specified term, such as 10 or 20
years, and does not accumulate cash value. Premiums for term life are typically lower
initially.
4. What is the role of the beneficiary in a life insurance policy?
The beneficiary is the person or entity designated to receive the death benefit from a life
insurance policy when the insured dies. Policyholders can name one or multiple
beneficiaries and may update this designation at any time unless the beneficiary is
irrevocable.
,5. What is insurable interest, and when must it exist in life insurance?
Insurable interest refers to the policyholder’s financial or emotional stake in the insured’s
life. It must exist at the time the policy is purchased. For example, spouses, parents, or
business partners typically have an insurable interest in each other’s lives.
6. What is the grace period in a life insurance policy?
The grace period is typically 30 or 31 days after a premium due date during which the policy
remains in force even if the premium has not been paid. If the insured dies during this
period, the death benefit is still paid, minus the owed premium.
7. What is a policy loan provision?
The policy loan provision allows the policyholder to borrow against the cash value of a
permanent life insurance policy. The loan does not require repayment, but any outstanding
balance, including interest, is deducted from the death benefit if unpaid at the time of death.
8. What is the contestability period in a life insurance policy?
The contestability period is typically the first two years of a life insurance policy during which
the insurer can investigate and deny a claim due to material misrepresentation or fraud in
the application. After this period, claims are usually paid even if inaccuracies are discovered.
9. What is the purpose of an annuity?
An annuity is a financial product that provides a stream of income, typically during
retirement. Purchased with a lump sum or periodic payments, annuities offer guaranteed
income either for a specific period or for life, helping individuals manage the risk of outliving
their savings.
10. What is the difference between a fixed and variable annuity?
A fixed annuity provides guaranteed payments and a fixed interest rate, offering stability and
low risk. A variable annuity allows investments in sub-accounts similar to mutual funds, and
the payouts fluctuate based on investment performance, carrying more risk and the potential
for higher returns.
11. What is a premium in life insurance?
A premium is the amount a policyholder pays to the insurer, usually monthly or annually, to
maintain coverage. Premiums are determined based on factors such as age, health,
coverage amount, and policy type. Failure to pay premiums can lead to policy lapse.
, 12. What is a rider in insurance policies?
A rider is an optional add-on to a base insurance policy that provides additional coverage or
benefits for an extra cost. Common riders include accidental death, waiver of premium, and
disability income. Riders allow customization of a policy to better suit individual needs.
13. What is the purpose of a waiver of premium rider?
The waiver of premium rider ensures that the policy remains in force without premium
payments if the insured becomes totally disabled. This rider helps maintain coverage during
periods of income loss due to disability, typically requiring a waiting period before activation.
14. What is the incontestability clause?
The incontestability clause prevents the insurer from denying a claim or voiding the policy
after it has been in force for a specified time, usually two years, even if there was
misinformation in the application, provided there was no fraud.
15. What is underwriting in insurance?
Underwriting is the process insurers use to evaluate the risk of insuring an individual. It
involves reviewing personal information such as health, age, lifestyle, and medical history to
determine eligibility and premium rates. The goal is to ensure fair risk assessment and
pricing.
16. What is group life insurance?
Group life insurance provides coverage to a group of individuals, typically employees of a
company, under a single master policy. It often offers basic coverage at low or no cost to the
employee and may allow optional supplemental coverage at the individual’s expense.
17. What is the difference between participating and non-participating life insurance
policies?
Participating policies pay dividends to policyholders if the insurer’s financial performance
allows. Non-participating policies do not pay dividends. Dividends can be used for premium
reductions, left to accumulate interest, or used to purchase additional coverage, but they are
not guaranteed.
18. What are dividends in life insurance?
Dividends are surplus profits returned to policyholders of participating life insurance policies.
They are considered a refund of excess premium and are not taxable. Policyholders may
use dividends in various ways, including cash payout, reducing premiums, or buying
additional coverage.
(2025/2026) – 220+ Expert-Verified
Questions & Correct Answers |
Guaranteed Pass | Latest Updated
Version
1. What is the primary purpose of life insurance?
The primary purpose of life insurance is to provide financial protection to beneficiaries upon
the death of the insured. It helps cover expenses such as funeral costs, outstanding debts,
and lost income, ensuring the beneficiaries maintain financial stability after the insured’s
passing.
2. What does the free-look period allow a policyholder to do?
The free-look period allows a new policyholder to review the insurance policy for a specified
number of days, typically 10 to 30, depending on the state. During this time, the policyholder
can cancel the policy for a full refund without penalty or obligation.
3. How does a whole life insurance policy differ from term life insurance?
Whole life insurance provides lifelong coverage and includes a cash value component that
grows over time. Term life insurance offers coverage for a specified term, such as 10 or 20
years, and does not accumulate cash value. Premiums for term life are typically lower
initially.
4. What is the role of the beneficiary in a life insurance policy?
The beneficiary is the person or entity designated to receive the death benefit from a life
insurance policy when the insured dies. Policyholders can name one or multiple
beneficiaries and may update this designation at any time unless the beneficiary is
irrevocable.
,5. What is insurable interest, and when must it exist in life insurance?
Insurable interest refers to the policyholder’s financial or emotional stake in the insured’s
life. It must exist at the time the policy is purchased. For example, spouses, parents, or
business partners typically have an insurable interest in each other’s lives.
6. What is the grace period in a life insurance policy?
The grace period is typically 30 or 31 days after a premium due date during which the policy
remains in force even if the premium has not been paid. If the insured dies during this
period, the death benefit is still paid, minus the owed premium.
7. What is a policy loan provision?
The policy loan provision allows the policyholder to borrow against the cash value of a
permanent life insurance policy. The loan does not require repayment, but any outstanding
balance, including interest, is deducted from the death benefit if unpaid at the time of death.
8. What is the contestability period in a life insurance policy?
The contestability period is typically the first two years of a life insurance policy during which
the insurer can investigate and deny a claim due to material misrepresentation or fraud in
the application. After this period, claims are usually paid even if inaccuracies are discovered.
9. What is the purpose of an annuity?
An annuity is a financial product that provides a stream of income, typically during
retirement. Purchased with a lump sum or periodic payments, annuities offer guaranteed
income either for a specific period or for life, helping individuals manage the risk of outliving
their savings.
10. What is the difference between a fixed and variable annuity?
A fixed annuity provides guaranteed payments and a fixed interest rate, offering stability and
low risk. A variable annuity allows investments in sub-accounts similar to mutual funds, and
the payouts fluctuate based on investment performance, carrying more risk and the potential
for higher returns.
11. What is a premium in life insurance?
A premium is the amount a policyholder pays to the insurer, usually monthly or annually, to
maintain coverage. Premiums are determined based on factors such as age, health,
coverage amount, and policy type. Failure to pay premiums can lead to policy lapse.
, 12. What is a rider in insurance policies?
A rider is an optional add-on to a base insurance policy that provides additional coverage or
benefits for an extra cost. Common riders include accidental death, waiver of premium, and
disability income. Riders allow customization of a policy to better suit individual needs.
13. What is the purpose of a waiver of premium rider?
The waiver of premium rider ensures that the policy remains in force without premium
payments if the insured becomes totally disabled. This rider helps maintain coverage during
periods of income loss due to disability, typically requiring a waiting period before activation.
14. What is the incontestability clause?
The incontestability clause prevents the insurer from denying a claim or voiding the policy
after it has been in force for a specified time, usually two years, even if there was
misinformation in the application, provided there was no fraud.
15. What is underwriting in insurance?
Underwriting is the process insurers use to evaluate the risk of insuring an individual. It
involves reviewing personal information such as health, age, lifestyle, and medical history to
determine eligibility and premium rates. The goal is to ensure fair risk assessment and
pricing.
16. What is group life insurance?
Group life insurance provides coverage to a group of individuals, typically employees of a
company, under a single master policy. It often offers basic coverage at low or no cost to the
employee and may allow optional supplemental coverage at the individual’s expense.
17. What is the difference between participating and non-participating life insurance
policies?
Participating policies pay dividends to policyholders if the insurer’s financial performance
allows. Non-participating policies do not pay dividends. Dividends can be used for premium
reductions, left to accumulate interest, or used to purchase additional coverage, but they are
not guaranteed.
18. What are dividends in life insurance?
Dividends are surplus profits returned to policyholders of participating life insurance policies.
They are considered a refund of excess premium and are not taxable. Policyholders may
use dividends in various ways, including cash payout, reducing premiums, or buying
additional coverage.
