Florida 2-20 Agents License Exam
Questions and Answers
The Florida Surplus Service Lines Office (FSLSO) was created to - correct Answer-
oversee the surplus lines industry in the state
Which of the following is NOT a required qualification for a General Lines Agent: -
correct Answer-Seeking the license only to write controlled business
The Department of Financial Services performs the following, EXCEPT: - correct
Answer-Pays insurance claims
Once license, you have how long to obtain an appointment? - correct Answer-48
months
Which of the following is NOT a duty of the Office of Insurance Regulation? - correct
Answer-Submit rate filings and underwriting rules for approval
Which one of the following statements is correct? - correct Answer-Contractors must
usually provide evidence of liability insurance before a construction contract is granted.
From a risk management viewpoint, insurance is used to - correct Answer-Transfer the
cost of losses.
Liability coverage for loss exposures arising from a business organization's premises
and operations, its products, or its completed work is typically provided by - correct
Answer-Commercial general liability insurance.
Which one of the following statements is correct regarding the benefits provided by
insurance? - correct Answer-Insurance helps reduce the financial burden to society by
compensating accident victims.
Insurance is not the only risk management transfer technique. When circumstances are
appropriate, transfer can be accomplished through - correct Answer-Noninsurance
transfer techniques.
Oscar's custom-built vehicle looks like a sausage sandwich on wheels. He plans to drive
it to special events at schools around the country where it will serve as a mobile
billboard to promote his product. Oscar is surprised to learn that insurers are reluctant to
insure his vehicle because it fails to meet one of the ideal characteristics of an insurable
,risk. Which characteristic is Oscar's vehicle least likely to meet? - correct Answer-Large
number of similar exposure units
Liability coverage to individuals and families for bodily injury and property damage
arising from the insured's personal premises or activities is typically provided by -
correct Answer-Personal liability insurance.
Sally is a recent college graduate who lives in the suburbs and drives to work daily in
the city. She recognizes that owning a car creates both property damage and liability
exposures for her and at the same time she has the burden of student loans. For
someone in Sally's circumstances the most practical risk management technique for
dealing with her auto-related loss exposures is - correct Answer-Risk transfer.
One of the costs of insurance is said to be opportunity costs. This means that if capital
and labor were not being used in the insurance business, they could be used elsewhere
and making other productive contributions to - correct Answer-Society
Retention is often used in combination with insurance as a way of treating loss
exposures. One of the major downsides of individuals using retention alone is - correct
Answer-The potential for financial ruin.
The process of restoring an individual or organization to a pre-loss financial condition is
the process of - correct Answer-Indemnification
Sometimes the existence of insurance encourages losses. The result of this
phenomenon is that it - correct Answer-Increases the total cost of insurance
A small business owner concerned about something happening and not being able to
work or earn a living for an extended period of time due to an accident should purchase
- correct Answer-Disability insurance.
Which of the following is/are not a "your covered auto" under a Personal Auto Policy for
Liability? - correct Answer-The 1990 Chevy 22 days after you purchase it as an
additional vehicle for your son who just got his license.
Joe has a Personal Auto Policy with one car with liability of 10/20/10, basic PIP, 10/20
UM and no Med Pay. His Florida neighbor has an identical policy on her care. Joe is
driving her car, loses control; and hits a tree. Joe is hurt with $15,000 in medical bills.
What is the maximum Joe can collect from UM from all sources from this accident? -
correct Answer-$0
Keith commutes into the city in his car, and he provides a ride to two co-workers who
live near him. Every other week, the co-workers take turns buying the gasoline for
Keith's car. Does this activity create a public or livery conveyance situation that would
preclude liability coverage under Keith's Personal Auto Policy (PAP)? - correct Answer-
No, because Keith is involved in a share-the-expense car pool.
, An insured covers his owned auto with more than one Personal Auto Policy (PAP), each
from a different insurer. In the event of a claim for medical payments coverage, - correct
Answer-Each insurer pays its pro rata share based on the proportion that its limit of
liability bears to the total of applicable limits.
The Insuring Agreement in Part A - Liability Coverage of the Personal Auto Policy
contains descriptions of all of the following EXCEPT: - correct Answer-Limit of Liability
Personal Inland Marine coverages are generally rated based on a rate per ______
dollars, varying by class. - correct Answer-100
This is an uncontrolled form that protects the shipper or receiver of goods against loss
to goods in transit throughout the year. - correct Answer-Annual Transit Policy
When cargo is shipped __________, the buyer assumes responsibility for the cargo
once goods reach the designated point. - correct Answer-Free on Board (FOB)
The __________ is an uncontrolled form that covers heavy equipment, machinery and
tools contractors used in the course of business. - correct Answer-Contractors
Equipment Floater
The controlled _______________from reimburses the insured for the cost of replacing
damaged manuscripts, films, maps, drawings, deeds, books or other printed, inscribed
or written documents (other than money and securities). - correct Answer-Valuable
Papers
Joe is out for an evening cruise on his 100 ft yacht. The fog rolls in and he loses all
visability. Then suddenly slams into another boat moored nearby. The damage to the
other boat is roughly $20,000. Under what section of Joe's Ocean Marine Policy would
there be coverage for the other boat? - correct Answer-Running Down Clause
Frank has a Personal Articles Floater with a fine arts schedule covering a painting.
Coverage is in the amount of $5,000. A three year old child comes in the house and
ruins the painting by marking it up with a black marker. The painting is now worthless.
The company has located the exact same painting for $2,000. What will the policy pay?
- correct Answer-$5,000
This coverage is written as an adjunct to Passenger Liability, not applicable to
passengers carried for hire. - correct Answer-Admitted Aircraft Liability Coverage
Physical damage insurance provided to cover loss or damage to an insured aircraft, in
motion, not in motion or both, is___________ insurance. - correct Answer-Aircraft Hull
Questions and Answers
The Florida Surplus Service Lines Office (FSLSO) was created to - correct Answer-
oversee the surplus lines industry in the state
Which of the following is NOT a required qualification for a General Lines Agent: -
correct Answer-Seeking the license only to write controlled business
The Department of Financial Services performs the following, EXCEPT: - correct
Answer-Pays insurance claims
Once license, you have how long to obtain an appointment? - correct Answer-48
months
Which of the following is NOT a duty of the Office of Insurance Regulation? - correct
Answer-Submit rate filings and underwriting rules for approval
Which one of the following statements is correct? - correct Answer-Contractors must
usually provide evidence of liability insurance before a construction contract is granted.
From a risk management viewpoint, insurance is used to - correct Answer-Transfer the
cost of losses.
Liability coverage for loss exposures arising from a business organization's premises
and operations, its products, or its completed work is typically provided by - correct
Answer-Commercial general liability insurance.
Which one of the following statements is correct regarding the benefits provided by
insurance? - correct Answer-Insurance helps reduce the financial burden to society by
compensating accident victims.
Insurance is not the only risk management transfer technique. When circumstances are
appropriate, transfer can be accomplished through - correct Answer-Noninsurance
transfer techniques.
Oscar's custom-built vehicle looks like a sausage sandwich on wheels. He plans to drive
it to special events at schools around the country where it will serve as a mobile
billboard to promote his product. Oscar is surprised to learn that insurers are reluctant to
insure his vehicle because it fails to meet one of the ideal characteristics of an insurable
,risk. Which characteristic is Oscar's vehicle least likely to meet? - correct Answer-Large
number of similar exposure units
Liability coverage to individuals and families for bodily injury and property damage
arising from the insured's personal premises or activities is typically provided by -
correct Answer-Personal liability insurance.
Sally is a recent college graduate who lives in the suburbs and drives to work daily in
the city. She recognizes that owning a car creates both property damage and liability
exposures for her and at the same time she has the burden of student loans. For
someone in Sally's circumstances the most practical risk management technique for
dealing with her auto-related loss exposures is - correct Answer-Risk transfer.
One of the costs of insurance is said to be opportunity costs. This means that if capital
and labor were not being used in the insurance business, they could be used elsewhere
and making other productive contributions to - correct Answer-Society
Retention is often used in combination with insurance as a way of treating loss
exposures. One of the major downsides of individuals using retention alone is - correct
Answer-The potential for financial ruin.
The process of restoring an individual or organization to a pre-loss financial condition is
the process of - correct Answer-Indemnification
Sometimes the existence of insurance encourages losses. The result of this
phenomenon is that it - correct Answer-Increases the total cost of insurance
A small business owner concerned about something happening and not being able to
work or earn a living for an extended period of time due to an accident should purchase
- correct Answer-Disability insurance.
Which of the following is/are not a "your covered auto" under a Personal Auto Policy for
Liability? - correct Answer-The 1990 Chevy 22 days after you purchase it as an
additional vehicle for your son who just got his license.
Joe has a Personal Auto Policy with one car with liability of 10/20/10, basic PIP, 10/20
UM and no Med Pay. His Florida neighbor has an identical policy on her care. Joe is
driving her car, loses control; and hits a tree. Joe is hurt with $15,000 in medical bills.
What is the maximum Joe can collect from UM from all sources from this accident? -
correct Answer-$0
Keith commutes into the city in his car, and he provides a ride to two co-workers who
live near him. Every other week, the co-workers take turns buying the gasoline for
Keith's car. Does this activity create a public or livery conveyance situation that would
preclude liability coverage under Keith's Personal Auto Policy (PAP)? - correct Answer-
No, because Keith is involved in a share-the-expense car pool.
, An insured covers his owned auto with more than one Personal Auto Policy (PAP), each
from a different insurer. In the event of a claim for medical payments coverage, - correct
Answer-Each insurer pays its pro rata share based on the proportion that its limit of
liability bears to the total of applicable limits.
The Insuring Agreement in Part A - Liability Coverage of the Personal Auto Policy
contains descriptions of all of the following EXCEPT: - correct Answer-Limit of Liability
Personal Inland Marine coverages are generally rated based on a rate per ______
dollars, varying by class. - correct Answer-100
This is an uncontrolled form that protects the shipper or receiver of goods against loss
to goods in transit throughout the year. - correct Answer-Annual Transit Policy
When cargo is shipped __________, the buyer assumes responsibility for the cargo
once goods reach the designated point. - correct Answer-Free on Board (FOB)
The __________ is an uncontrolled form that covers heavy equipment, machinery and
tools contractors used in the course of business. - correct Answer-Contractors
Equipment Floater
The controlled _______________from reimburses the insured for the cost of replacing
damaged manuscripts, films, maps, drawings, deeds, books or other printed, inscribed
or written documents (other than money and securities). - correct Answer-Valuable
Papers
Joe is out for an evening cruise on his 100 ft yacht. The fog rolls in and he loses all
visability. Then suddenly slams into another boat moored nearby. The damage to the
other boat is roughly $20,000. Under what section of Joe's Ocean Marine Policy would
there be coverage for the other boat? - correct Answer-Running Down Clause
Frank has a Personal Articles Floater with a fine arts schedule covering a painting.
Coverage is in the amount of $5,000. A three year old child comes in the house and
ruins the painting by marking it up with a black marker. The painting is now worthless.
The company has located the exact same painting for $2,000. What will the policy pay?
- correct Answer-$5,000
This coverage is written as an adjunct to Passenger Liability, not applicable to
passengers carried for hire. - correct Answer-Admitted Aircraft Liability Coverage
Physical damage insurance provided to cover loss or damage to an insured aircraft, in
motion, not in motion or both, is___________ insurance. - correct Answer-Aircraft Hull
