Florida Life and Health Insurance State Exam Review
(2-15) Questions and Answers
Insured - ANSWERThe person covered by the insurance policy.
Rider - ANSWERA written modification attached to a policy that increases or
decreases coverage and/or premiums.
What is a unilateral contract? - ANSWERA contract in which only one of the parties is
legally bound to fulfill its obligations.
What law protects consumers from the circulation of inaccurate or obsolete
information? - ANSWERThe Fair Credit Reporting Act.
What are the three types of agent authority? - ANSWERImplied, Express, and
Apparent.
Agent - ANSWERAn individual who is licensed to sell, negotiate, or effect insurance
contracts on behalf of the insurer.
What is name of the process that insurance companies use to determine whether or
not an applicant is insurable? - ANSWERUnderwriting
The requirement that agents must account for and promptly remit all insurance
funds collected is known as what type of agent responsibility? - ANSWERFiduciary
What is a third-party ownership? - ANSWERAn insurance arrangement in which the
policy owner and the insured are not the same person.
Suitability - ANSWERFactors that determine if an insurance product is appropriate
for a particular customer.
Premium - ANSWERA payment by the policy owner to the insurance company to
keep the policy in force.
Disclosure - ANSWERProviding sufficient information to help someone make
informed decision.
An agent offer a client free tickets to a sporting event in exchange for the purchase
of an insurance policy. What is the agent guilty of? - ANSWERRebating
If an insurer meets the states financial requirements and is approved to transact
business in the state, it is considered what type of insurer? - ANSWERAuthorized
What information are the members of the medical information bureau required to
report? - ANSWERAdverse medical information about the applicants or insureds.
,What type of beneficiary can be changed at any point by the policy owner? -
ANSWERRevocable
What document describes the specific information about a policy? - ANSWERPolicy
Summary
What is the term for the causes of loss insured against in an insurance policy? -
ANSWERPeril
Whom does an insurance agent represent? - ANSWERInsurance Company
What is an unfair trade practice? - ANSWERAny fraudulent, deceptive, or dishonest
business practice that is prohibited by statutes and regulations.
Insurer - ANSWERThe company that issues an insurance policy.
Peril - ANSWERCause of loss
Contract of Adhesion - ANSWERA contract prepared by one party that must be
accepted as written or be rejected by the other party.
What are the four elements of an insurance contract? - ANSWERAgreement (Offer
and Acceptance), consideration, competent parties, and legal purpose.
Policy Provision - ANSWERA clause that stipulates the rights and obligations under an
insurance contract.
Fiduciary - ANSWERA producer who handles insurer's funds in a trust capacity.
Who is considered a nonresident agent? - ANSWERAn agent who resides and is
licensed in another state, but is authorized to transact insurance in Florida.
What is underwriting? - ANSWERThe risk selection and classification process.
What is the best way to handle incomplete insurance applications? - ANSWERReturn
the application to the applicant for completion.
What are the five characteristics of an ideally insurable risk? - ANSWERLoss must be:
1. Due to Change
2. Definite and measurable
3. Statistically predictable
4. Not catastrophic
5. Coverage cannot be mandatory.
What type of policy issues certificates of insurance to the insurance? -
ANSWERGroup Policy
, What is the purpose of a free-look period? - ANSWERTo allow the insured to return
the policy and get a full refund (if done during the free-look period)
Whose responsibility is it to determine that all of the questions on an insurance
application are answered? - ANSWERThe Agent's
What types of licensee represents the insurance company? - ANSWERAgent
Who must be notified of the producers change of address? - ANSWERThe
department of Insurance
Certificate of Insurance - ANSWERA document issued to insureds under a group plan
that states the coverage being issued, and indicates the coverage type and amounts.
Nonrenewal - ANSWERTermination of a policy by an insurer on the anniversary or
renewal date.
Representation - ANSWERA statement made by the applicant on the insurance
application that is believed to be true.
What is a warranty? - ANSWERAn absolutely true statement that, if breached, may
viod an insurance contract.
In insurance, when is the offer usually made on a contract? - ANSWERWhen the
insurance application is submitted.
When a change needs to be made on the application for insurance, which is the best
method for correcting the information? - ANSWERComplete a new application or ask
the applicant to initial the correction on the original application.
A situation in which a person can only experience a loss and no gain represents what
type of risk? - ANSWERPure Risk
Who is responsible for the contents of insurance advertisements? - ANSWERThe
Insurance Company
What is the entire contract in health insurance underwriting? - ANSWERThe policy
with riders and endorsements, plus a copy of the application.
What is the main purpose for requiring a person to be licensed to transact
insurance? - ANSWERTo protect the general public.
Who is an insurance agent? - ANSWERA person authorized to sell, solicit, and
negotiate insurance contracts.
(2-15) Questions and Answers
Insured - ANSWERThe person covered by the insurance policy.
Rider - ANSWERA written modification attached to a policy that increases or
decreases coverage and/or premiums.
What is a unilateral contract? - ANSWERA contract in which only one of the parties is
legally bound to fulfill its obligations.
What law protects consumers from the circulation of inaccurate or obsolete
information? - ANSWERThe Fair Credit Reporting Act.
What are the three types of agent authority? - ANSWERImplied, Express, and
Apparent.
Agent - ANSWERAn individual who is licensed to sell, negotiate, or effect insurance
contracts on behalf of the insurer.
What is name of the process that insurance companies use to determine whether or
not an applicant is insurable? - ANSWERUnderwriting
The requirement that agents must account for and promptly remit all insurance
funds collected is known as what type of agent responsibility? - ANSWERFiduciary
What is a third-party ownership? - ANSWERAn insurance arrangement in which the
policy owner and the insured are not the same person.
Suitability - ANSWERFactors that determine if an insurance product is appropriate
for a particular customer.
Premium - ANSWERA payment by the policy owner to the insurance company to
keep the policy in force.
Disclosure - ANSWERProviding sufficient information to help someone make
informed decision.
An agent offer a client free tickets to a sporting event in exchange for the purchase
of an insurance policy. What is the agent guilty of? - ANSWERRebating
If an insurer meets the states financial requirements and is approved to transact
business in the state, it is considered what type of insurer? - ANSWERAuthorized
What information are the members of the medical information bureau required to
report? - ANSWERAdverse medical information about the applicants or insureds.
,What type of beneficiary can be changed at any point by the policy owner? -
ANSWERRevocable
What document describes the specific information about a policy? - ANSWERPolicy
Summary
What is the term for the causes of loss insured against in an insurance policy? -
ANSWERPeril
Whom does an insurance agent represent? - ANSWERInsurance Company
What is an unfair trade practice? - ANSWERAny fraudulent, deceptive, or dishonest
business practice that is prohibited by statutes and regulations.
Insurer - ANSWERThe company that issues an insurance policy.
Peril - ANSWERCause of loss
Contract of Adhesion - ANSWERA contract prepared by one party that must be
accepted as written or be rejected by the other party.
What are the four elements of an insurance contract? - ANSWERAgreement (Offer
and Acceptance), consideration, competent parties, and legal purpose.
Policy Provision - ANSWERA clause that stipulates the rights and obligations under an
insurance contract.
Fiduciary - ANSWERA producer who handles insurer's funds in a trust capacity.
Who is considered a nonresident agent? - ANSWERAn agent who resides and is
licensed in another state, but is authorized to transact insurance in Florida.
What is underwriting? - ANSWERThe risk selection and classification process.
What is the best way to handle incomplete insurance applications? - ANSWERReturn
the application to the applicant for completion.
What are the five characteristics of an ideally insurable risk? - ANSWERLoss must be:
1. Due to Change
2. Definite and measurable
3. Statistically predictable
4. Not catastrophic
5. Coverage cannot be mandatory.
What type of policy issues certificates of insurance to the insurance? -
ANSWERGroup Policy
, What is the purpose of a free-look period? - ANSWERTo allow the insured to return
the policy and get a full refund (if done during the free-look period)
Whose responsibility is it to determine that all of the questions on an insurance
application are answered? - ANSWERThe Agent's
What types of licensee represents the insurance company? - ANSWERAgent
Who must be notified of the producers change of address? - ANSWERThe
department of Insurance
Certificate of Insurance - ANSWERA document issued to insureds under a group plan
that states the coverage being issued, and indicates the coverage type and amounts.
Nonrenewal - ANSWERTermination of a policy by an insurer on the anniversary or
renewal date.
Representation - ANSWERA statement made by the applicant on the insurance
application that is believed to be true.
What is a warranty? - ANSWERAn absolutely true statement that, if breached, may
viod an insurance contract.
In insurance, when is the offer usually made on a contract? - ANSWERWhen the
insurance application is submitted.
When a change needs to be made on the application for insurance, which is the best
method for correcting the information? - ANSWERComplete a new application or ask
the applicant to initial the correction on the original application.
A situation in which a person can only experience a loss and no gain represents what
type of risk? - ANSWERPure Risk
Who is responsible for the contents of insurance advertisements? - ANSWERThe
Insurance Company
What is the entire contract in health insurance underwriting? - ANSWERThe policy
with riders and endorsements, plus a copy of the application.
What is the main purpose for requiring a person to be licensed to transact
insurance? - ANSWERTo protect the general public.
Who is an insurance agent? - ANSWERA person authorized to sell, solicit, and
negotiate insurance contracts.
