FLORIDA INSURANCE 20-44 PERSONAL
LINES AGENT EXAM PREP 2027
QUESTIONS AND ANSWERS
1. Under the Florida Valued Policy Law, if a total loss occurs to a building caused by a covered
peril, what is the insurer’s liability?
A. The actual cash value of the property at the time of loss.
B. The replacement cost of the property regardless of policy limits.
C. The full amount of insurance for which the property was insured.
D. The amount determined by a neutral appraiser after the loss.
Answer: C
Conceptual Explanation: Florida Statute 627.702 states that if a building is a total loss
from a covered peril, the insurer must pay the full face amount of the policy.
2. A Florida insured has Personal Injury Protection (PIP) with a $1,000 deductible. If they incur
$10,000 in medical bills, how much will PIP pay?
A. $8,000
B. $7,200
,C. $9,000
D. $10,000
Answer: B
Conceptual Explanation: PIP pays 80% of medical expenses. Calculations: ($10,000 -
$1,000 deductible) * 0.80 = $7,200.
3. Which of the following is TRUE regarding the Florida Automobile Joint Underwriting
Association (FAJUA)?
A. It provides insurance for those unable to obtain it in the voluntary market.
B. It is a private insurer that competes with standard companies.
C. It only covers high-value luxury sports cars.
D. It is funded entirely by the state government.
Answer: A
Conceptual Explanation: The FAJUA is a market of last resort for individuals who cannot
obtain auto insurance through standard carriers.
4. In Florida, what is the minimum required limit for property damage liability under the
Financial Responsibility Law?
A. $5,000
B. $50,000
C. $20,000
, D. $10,000
Answer: D
Conceptual Explanation: Florida requires at least $10,000 in Property Damage Liability
(PDL) and $10,000 in PIP.
5. Which entity is responsible for overseeing the financial condition of insurance companies in
Florida?
A. The Office of Insurance Regulation (OIR)
B. The Department of Financial Services (DFS)
C. The Florida Insurance Guaranty Association (FIGA)
D. The Florida Surplus Lines Service Office (FSLSO)
Answer: A
Conceptual Explanation: The OIR is responsible for company solvency, rates, and forms,
whereas the DFS handles agent licensing and consumer complaints.
6. Under an HO-3 policy, which of the following is typically an excluded peril?
A. Flood
B. Theft
C. Fire
D. Windstorm
LINES AGENT EXAM PREP 2027
QUESTIONS AND ANSWERS
1. Under the Florida Valued Policy Law, if a total loss occurs to a building caused by a covered
peril, what is the insurer’s liability?
A. The actual cash value of the property at the time of loss.
B. The replacement cost of the property regardless of policy limits.
C. The full amount of insurance for which the property was insured.
D. The amount determined by a neutral appraiser after the loss.
Answer: C
Conceptual Explanation: Florida Statute 627.702 states that if a building is a total loss
from a covered peril, the insurer must pay the full face amount of the policy.
2. A Florida insured has Personal Injury Protection (PIP) with a $1,000 deductible. If they incur
$10,000 in medical bills, how much will PIP pay?
A. $8,000
B. $7,200
,C. $9,000
D. $10,000
Answer: B
Conceptual Explanation: PIP pays 80% of medical expenses. Calculations: ($10,000 -
$1,000 deductible) * 0.80 = $7,200.
3. Which of the following is TRUE regarding the Florida Automobile Joint Underwriting
Association (FAJUA)?
A. It provides insurance for those unable to obtain it in the voluntary market.
B. It is a private insurer that competes with standard companies.
C. It only covers high-value luxury sports cars.
D. It is funded entirely by the state government.
Answer: A
Conceptual Explanation: The FAJUA is a market of last resort for individuals who cannot
obtain auto insurance through standard carriers.
4. In Florida, what is the minimum required limit for property damage liability under the
Financial Responsibility Law?
A. $5,000
B. $50,000
C. $20,000
, D. $10,000
Answer: D
Conceptual Explanation: Florida requires at least $10,000 in Property Damage Liability
(PDL) and $10,000 in PIP.
5. Which entity is responsible for overseeing the financial condition of insurance companies in
Florida?
A. The Office of Insurance Regulation (OIR)
B. The Department of Financial Services (DFS)
C. The Florida Insurance Guaranty Association (FIGA)
D. The Florida Surplus Lines Service Office (FSLSO)
Answer: A
Conceptual Explanation: The OIR is responsible for company solvency, rates, and forms,
whereas the DFS handles agent licensing and consumer complaints.
6. Under an HO-3 policy, which of the following is typically an excluded peril?
A. Flood
B. Theft
C. Fire
D. Windstorm
