FLORIDA 240 LICENSE EXAM AND PRACTICE
EXAM LATEST 2024/2025 QUESTIONS & VERIFIED
ANSWERS (GRADE A+) 100% GUARANTEED PASS
The stated amount or percent of liquid assets that an insurer must have on hand that will satisfy
future obligations to its policyholders is called:
Ans>> Reserves
An insurance applicant MUST be informed of an investigation regarding his/her reputation and
character according to the:
Ans>> Fair Credit Reporting Act
A nonprofit incorporated society that does not have capital stock and operates for the sole
benefit of its members is known as:
Ans>> A fraternal benefit society
What I the name of the law that requires insurers to disclose information gathering practices and
where the information was obtained?
Ans>> Fair Credit Reporting Act
Who elects the governing body of a mutual insurance company?
1
,Ans>> Policyholders
A group-owned insurance company that is formed to assume and spread the liability ricks of its
members is known as a:
Ans>> Risk retention group
What type of reinsurance contract involves two companies automatically sharing their risk
exposure?
Ans>> treaty
What year was the McCarran-Ferguson Act enacted?
Ans>> 1945
Which of these describe a participating life insurance policy?
Ans>> Policy owners are entitled to receive dividends
At what point must a life insurance applicant be informed of their rights that fall under the Fair
Credit Reporting Act?
2
,Ans>> Upon completion of the application
Which of the following requires insurers to disclose when an applicant's consumer or credit history
is being investigated:
Ans>> 1970 - Fair Credit Reporting Act
What type of reinsurance contract involves two companies automatically sharing their risk
exposure?
Ans>> Treaty
A group-owned insurance company that is formed to assume and spread the liability risks of its
members is known as a:
Ans>> risk retention group
All of the following are considered to be typical characteristics describing the nature of an
insurance contract, EXCEPT:
Ans>> Bilateral
The part of a life insurance policy guaranteed to be true is called a(n)
3
, Ans>> warranty
Statements made on an insurance application that are believed to be true to the best of the
applicant's knowledge are called
Ans>> representations
Q purchases a $500,000 life insurance policy and pays $900 in premiums over the first six
months. Q dies suddenly and the beneficiary is paid $500,000. This exchange of unequal values
reflects which of the following insurance contract features?
Ans>> Aleatory
When must insurable interest be present in order for a life insurance policy to be valid?
Ans>> When the application is made
A life insurance arrangement which circumvents insurable interest statutes is called:
Ans>> Investor-Originated Life Insurance
Stranger Originated Life Insurance (STOLI) has been found to be in violation of which of the
following contractual elements?
4
EXAM LATEST 2024/2025 QUESTIONS & VERIFIED
ANSWERS (GRADE A+) 100% GUARANTEED PASS
The stated amount or percent of liquid assets that an insurer must have on hand that will satisfy
future obligations to its policyholders is called:
Ans>> Reserves
An insurance applicant MUST be informed of an investigation regarding his/her reputation and
character according to the:
Ans>> Fair Credit Reporting Act
A nonprofit incorporated society that does not have capital stock and operates for the sole
benefit of its members is known as:
Ans>> A fraternal benefit society
What I the name of the law that requires insurers to disclose information gathering practices and
where the information was obtained?
Ans>> Fair Credit Reporting Act
Who elects the governing body of a mutual insurance company?
1
,Ans>> Policyholders
A group-owned insurance company that is formed to assume and spread the liability ricks of its
members is known as a:
Ans>> Risk retention group
What type of reinsurance contract involves two companies automatically sharing their risk
exposure?
Ans>> treaty
What year was the McCarran-Ferguson Act enacted?
Ans>> 1945
Which of these describe a participating life insurance policy?
Ans>> Policy owners are entitled to receive dividends
At what point must a life insurance applicant be informed of their rights that fall under the Fair
Credit Reporting Act?
2
,Ans>> Upon completion of the application
Which of the following requires insurers to disclose when an applicant's consumer or credit history
is being investigated:
Ans>> 1970 - Fair Credit Reporting Act
What type of reinsurance contract involves two companies automatically sharing their risk
exposure?
Ans>> Treaty
A group-owned insurance company that is formed to assume and spread the liability risks of its
members is known as a:
Ans>> risk retention group
All of the following are considered to be typical characteristics describing the nature of an
insurance contract, EXCEPT:
Ans>> Bilateral
The part of a life insurance policy guaranteed to be true is called a(n)
3
, Ans>> warranty
Statements made on an insurance application that are believed to be true to the best of the
applicant's knowledge are called
Ans>> representations
Q purchases a $500,000 life insurance policy and pays $900 in premiums over the first six
months. Q dies suddenly and the beneficiary is paid $500,000. This exchange of unequal values
reflects which of the following insurance contract features?
Ans>> Aleatory
When must insurable interest be present in order for a life insurance policy to be valid?
Ans>> When the application is made
A life insurance arrangement which circumvents insurable interest statutes is called:
Ans>> Investor-Originated Life Insurance
Stranger Originated Life Insurance (STOLI) has been found to be in violation of which of the
following contractual elements?
4
