FLORIDA LICENSING QUESTIONS WITH ACCURATE
ANSWERS
All of the following describe insurable interest EXCEPT:
• It must exist at the time of the loss
• It must exist for insurance to respond
• Shows a similarity between insurance and wagering
• The insured would suffer an economic loss Accurate Answer - •
Shows a similarity between insurance and wagering
An Insurance Policy is a contract with all the following characteristics,
EXCEPT:
• It is a personal contract
• parties are of unequal power with ambiguities or unclear working
resolved in favor of the insured because it is a contract of adhesion
• Indemnity is not part of an insurance contract
• There are conditions imposed on both the insurer and insured
Accurate Answer - • Indemnity is not part of an insurance contract
An insurance contract which may contain a "gray area" or an ambiguity that
is generally resolved in favor of the insured because insurance is a contract
of: Accurate Answer - Adhesion
If an insured sells his car to another person, the buyer may be prohibited
from also receiving the insured's policy. This is because the insurance
contract is a contract of: Accurate Answer - Personal nature
Strict or absolute liability Accurate Answer - Is assigned by law or
statute
Jack and Connie agree to have Jack burn down Connie's house for $10,000.
What element of a valid contract is missing? Accurate Answer -
Legal Purpose
Risks that are insurable are Accurate Answer - Pure risks
,Insurance that covers the responsibility for loss arising out of negligence
that results in payment to a party other than the insured is:
Accurate Answer - Liability Insurance
The goal of insurance is to restore the insured to the same economic
position as before the covered loss, this is the principle of Accurate
Answer - Indemnity
All of the following are ways that liability limits can be expressed except:
• PIP Limit
• Aggregate Limit
• Split Limit
• Single Limit Accurate Answer - PIP Limit
An insured has A SPLIT limit liability policy with 10/20/10 limits. He owes
the following people liability bodily injuries claims of: Passenger 1 =
$12,000, Passenger 2 = $10,000, Passenger 3 = $18,000. How much liability
insurance will his policy pay for these claims? Accurate Answer -
$20,000
If a lender has an insurable interest in an auto, because of the money
loaned to finance the purchase, the lender would appear on the policy as
the:
• Lessee
• Loss Payee
• Mortgagor
• Mortgagee Accurate Answer - Loss Payee
To turn partially damaged property over to the insurance company and ask
them to pay for a total loss is called Accurate Answer -
Abandonment
Firemen caused water damage to a property by spraying water to put out a
fire. If the property insurance policy listed fire as the only named peril:
Accurate Answer - The water damage is covered due to the concept of
proximate cause
, XYZ Insurance Corp. filed its corporate charter in Tallahassee and has its
home office in Tampa: Accurate Answer - In Florida, XYZ is a
domestic insurer
An insured has a home with a replacement cost / value of $100,000, on
which he carries an insurance policy for $80,000 with an 80% Coinsurance
clause. The insured has a $20,000 partial loss, the insurance company will
pay how much for this partial loss of $20,000? (Remember $80,000 is 80%
of $100,000) Accurate Answer - $20,000
"Actual Cash Value" ACV means: Accurate Answer - Current cost to
replace minus depreciation
Which of the following is TRUE concerning Subrogation? Accurate
Answer - Allows insurer to sue a negligent third party to recover a loss paid
to an insured
All of the following may qualify for a dwelling policy EXCEPT:
• A 6 - family dwelling
• A beach house owned by ACME Corporation
• A small single family home, rented by a salesman
• An old frame home, built upon piers, valued at $10,000 and occupied by
the owner, Mrs. Jones. Company underwriting minimum for a homeowner
policy is $50,000 Accurate Answer - A 6 - family dwelling
All of the following are eligible for a Homeowners Policy EXCEPT:
• A person who rents an apartment
• A condominium owner
• Owner-occupant of a four-family dwelling
• A beach house owned by ACME Corporation Accurate Answer - A
beach house owned by ACME Corporation
The principle of "insurable interest" is important in the dwelling policy as
well as other kinds of insurance. Which of the following does not have
"insurable interest" in the described property?
• The one who holds title to the property
• One who inherits title to property under the terms of a will
• One who attends a Mary Kay party at a friend's property
ANSWERS
All of the following describe insurable interest EXCEPT:
• It must exist at the time of the loss
• It must exist for insurance to respond
• Shows a similarity between insurance and wagering
• The insured would suffer an economic loss Accurate Answer - •
Shows a similarity between insurance and wagering
An Insurance Policy is a contract with all the following characteristics,
EXCEPT:
• It is a personal contract
• parties are of unequal power with ambiguities or unclear working
resolved in favor of the insured because it is a contract of adhesion
• Indemnity is not part of an insurance contract
• There are conditions imposed on both the insurer and insured
Accurate Answer - • Indemnity is not part of an insurance contract
An insurance contract which may contain a "gray area" or an ambiguity that
is generally resolved in favor of the insured because insurance is a contract
of: Accurate Answer - Adhesion
If an insured sells his car to another person, the buyer may be prohibited
from also receiving the insured's policy. This is because the insurance
contract is a contract of: Accurate Answer - Personal nature
Strict or absolute liability Accurate Answer - Is assigned by law or
statute
Jack and Connie agree to have Jack burn down Connie's house for $10,000.
What element of a valid contract is missing? Accurate Answer -
Legal Purpose
Risks that are insurable are Accurate Answer - Pure risks
,Insurance that covers the responsibility for loss arising out of negligence
that results in payment to a party other than the insured is:
Accurate Answer - Liability Insurance
The goal of insurance is to restore the insured to the same economic
position as before the covered loss, this is the principle of Accurate
Answer - Indemnity
All of the following are ways that liability limits can be expressed except:
• PIP Limit
• Aggregate Limit
• Split Limit
• Single Limit Accurate Answer - PIP Limit
An insured has A SPLIT limit liability policy with 10/20/10 limits. He owes
the following people liability bodily injuries claims of: Passenger 1 =
$12,000, Passenger 2 = $10,000, Passenger 3 = $18,000. How much liability
insurance will his policy pay for these claims? Accurate Answer -
$20,000
If a lender has an insurable interest in an auto, because of the money
loaned to finance the purchase, the lender would appear on the policy as
the:
• Lessee
• Loss Payee
• Mortgagor
• Mortgagee Accurate Answer - Loss Payee
To turn partially damaged property over to the insurance company and ask
them to pay for a total loss is called Accurate Answer -
Abandonment
Firemen caused water damage to a property by spraying water to put out a
fire. If the property insurance policy listed fire as the only named peril:
Accurate Answer - The water damage is covered due to the concept of
proximate cause
, XYZ Insurance Corp. filed its corporate charter in Tallahassee and has its
home office in Tampa: Accurate Answer - In Florida, XYZ is a
domestic insurer
An insured has a home with a replacement cost / value of $100,000, on
which he carries an insurance policy for $80,000 with an 80% Coinsurance
clause. The insured has a $20,000 partial loss, the insurance company will
pay how much for this partial loss of $20,000? (Remember $80,000 is 80%
of $100,000) Accurate Answer - $20,000
"Actual Cash Value" ACV means: Accurate Answer - Current cost to
replace minus depreciation
Which of the following is TRUE concerning Subrogation? Accurate
Answer - Allows insurer to sue a negligent third party to recover a loss paid
to an insured
All of the following may qualify for a dwelling policy EXCEPT:
• A 6 - family dwelling
• A beach house owned by ACME Corporation
• A small single family home, rented by a salesman
• An old frame home, built upon piers, valued at $10,000 and occupied by
the owner, Mrs. Jones. Company underwriting minimum for a homeowner
policy is $50,000 Accurate Answer - A 6 - family dwelling
All of the following are eligible for a Homeowners Policy EXCEPT:
• A person who rents an apartment
• A condominium owner
• Owner-occupant of a four-family dwelling
• A beach house owned by ACME Corporation Accurate Answer - A
beach house owned by ACME Corporation
The principle of "insurable interest" is important in the dwelling policy as
well as other kinds of insurance. Which of the following does not have
"insurable interest" in the described property?
• The one who holds title to the property
• One who inherits title to property under the terms of a will
• One who attends a Mary Kay party at a friend's property
