Florida Life and Health Pre-licensing Test Questions and Correct Answers

Florida Life and Health Pre-licensing Test Questions and Correct Answers Participating When a policy pays dividends to its policyholders, it is said to be Risk Retention Assesses and spreads risk of liability to members Policyholders Elects the governing body of a mutual insurance company Investor Contract Life insurance arrangement which circumvents insurable interest statuses Investor Originated Life Insurance (IOLI) allows one to bypass insurable interest laws Stranger-Originated Life Insurance (STOLI) Violates legal purpose Fiduciary Responsibility An ethical and legal obligation to perform a person's duties in a trustworthy manner. EX. Taking premium and holding for insurance company Consideration given by an insurer Promise to pay death benefit Adhesion One party accepts or rejects terms of contract Contract of Adhesion The insured must accept the entire contract with all of its terms and conditions or reject in full. Warranty Assurance by the seller that the products will perform as represented Agent responsibility is to The insurance company Funding for Medicaid part B Half is funded by user premiums Contract Includes the policy and application What does NAIFA stand for? National Association of Insurance and Financial Advisors What is the primary purpose of NAIFA? Designed to protect agents, Code of ethic in Florida Laws What industry does NAIFA primarily support? Life insurance industry What happens when the insured misrepresents their age on the policy? Insured will pay premiums according to their correct age at the time of the application