FLORIDA 240 LICENSE EXAM 2025 LATEST WITH
350 REAL EXAM QUESTIONS AND CORRECT
ANSWERS (100% CORRECT ANSWERS) FL 2-40
HEALTH INSURANCE PRE-LICENSING EXAM (NEW)
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: - CORRECT ANSWER-Reserves
An insurance applicant MUST be informed of an investigation regarding his/her reputation and
character according to the: - CORRECT ANSWER-Fair Credit Reporting Act
An insured owns an individual Disability Income policy with a 30-day Elimination Period for sickness
and accidents and a monthly indemnity benefit of $500. If the insured is disabled for 3 1/2 months,
what is the MAXIMUM amount he would receive for an approved claim? - CORRECT ANSWER-$1,250
J has a Disability Income policy that does NOT provide benefits for losses occurring as the result of
his employment. What kind of coverage is this? - CORRECT ANSWER-Nonoccupational coverage
An individual Disability Income insurance applicant may be required to submit all of the following
information EXCEPT - CORRECT ANSWER-spouse's occupation
V is insured under an individual Disability Income policy with a 30-day Elimination period. On July 1,
he is involved in an accident and temporarily disabled. He returns to work on December 1. How
many months of benefit are payable? - CORRECT ANSWER-4 months
Disability policies do NOT normally pay for disabilities arising from which of the following? -
CORRECT ANSWER-war
What is the elimination period of an individual disability policy? - CORRECT ANSWER-Time period a
disabled person must wait before benefits are paid
What does a Guaranteed Insurability rider provide a Disability Income policyowner? - CORRECT
ANSWER-The ability to periodically increase the amount of coverage without evidence of insurability
,B is a teacher who was injured in a car accident and cannot work. She is now receiving monthly
benefits as a result of this accident. Which type of policy does B have? - CORRECT ANSWER-Disability
Income
In a Disability Income policy, which of these clauses acts as a deductible? - CORRECT ANSWER-
Elimination period
When a person returns to work after a period of total disability but cannot earn as much as he or she
did before the disability, this situation is called which of the following? - CORRECT ANSWER-Residual
disability
T has Disability Income policy that pays a monthly benefit of $5000. If T becomes partially disabled,
what can he likely expect? - CORRECT ANSWER-Less than $5,000 per month benefit regardless of the
cause
Which of the following is the MOST important factor when deciding how much Disability Income
coverage an applicant should purchase? - CORRECT ANSWER-Applicant's monthly income
R had received full disability income benefits for 6 months. When he returns to work, he is only able
to resume half his normal daily workload. Which provision pays reduced benefits to R while he is not
working at full capacity? - CORRECT ANSWER-Residual disability
With Disability Income insurance, an insurance company may limit the monthly benefit amount a
prospective policy holder may obtain because of the insured's - CORRECT ANSWER-gross income at
the time of purchase
K becomes ill after traveling overseas and is unable to work for 3 months. What kind of policy would
cover her loss of income? - CORRECT ANSWER-Disability Income
D is an architect receiving Disability Income benefits who is not able to return to work full time, but
can work on a part-time basis. Which of these features would allow D to continue receiving benefits?
- CORRECT ANSWER-Residual Benefit clause
Non-occupational disability coverage is designed for: - CORRECT ANSWER-employees who suffer
non-work related disabilities, since work-related disabilities are covered by Workers' Compensation
,A nonprofit incorporated society that does not have capital stock and operates for the sole benefit
of its members is known as: - CORRECT ANSWER-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? - CORRECT ANSWER-Fair Credit Reporting Act
Who elects the governing body of a mutual insurance company? - CORRECT ANSWER-Policyholders
A group-owned insurance company that is formed to assume and spread the liability ricks of its
members is known as a: - CORRECT ANSWER-Risk retention group
What type of reinsurance contract involves two companies automatically sharing their risk
exposure? - CORRECT ANSWER-treaty
What year was the McCarran-Ferguson Act enacted? - CORRECT ANSWER-1945
Which of these describe a participating life insurance policy? - CORRECT ANSWER-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? - CORRECT ANSWER-Upon completion of the application
Which of the following requires insurers to disclose when an applicant's consumer or credit history is
being investigated: - CORRECT ANSWER-1970 - Fair Credit Reporting Act
What type of reinsurance contract involves two companies automatically sharing their risk
exposure? - CORRECT ANSWER-Treaty
A group-owned insurance company that is formed to assume and spread the liability risks of its
members is known as a: - CORRECT ANSWER-risk retention group
All of the following are considered to be typical characteristics describing the nature of an insurance
contract, EXCEPT: - CORRECT ANSWER-Bilateral
, The part of a life insurance policy guaranteed to be true is called a(n) - CORRECT ANSWER-warranty
Statements made on an insurance application that are believed to be true to the best of the
applicant's knowledge are called - CORRECT ANSWER-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? - CORRECT ANSWER-Aleatory
When must insurable interest be present in order for a life insurance policy to be valid? - CORRECT
ANSWER-When the application is made
A life insurance arrangement which circumvents insurable interest statutes is called: - CORRECT
ANSWER-Investor-Originated Life Insurance
Stranger Originated Life Insurance (STOLI) has been found to be in violation of which of the following
contractual elements? - CORRECT ANSWER-Legal Purpose (Insurable Interest)
Who makes the legally enforceable promises in a unilateral contract? - CORRECT ANSWER-Insurance
company
A policy of adhesion can only be modified by whom? - CORRECT ANSWER-insurance company
When third-party ownership is involved, applicants who also happen to be the stated primary
beneficiary are required to have: - CORRECT ANSWER-insurable interest in the proposed insured
Which of these is considered a statement that is assured to be true in every aspect? - CORRECT
ANSWER-Warranty
Which of these require an offer, acceptance, and consideration? - CORRECT ANSWER-contract
If a contract of adhesion contains complicated language, to whom would the interpretation be in
favor of? - CORRECT ANSWER-insured
350 REAL EXAM QUESTIONS AND CORRECT
ANSWERS (100% CORRECT ANSWERS) FL 2-40
HEALTH INSURANCE PRE-LICENSING EXAM (NEW)
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: - CORRECT ANSWER-Reserves
An insurance applicant MUST be informed of an investigation regarding his/her reputation and
character according to the: - CORRECT ANSWER-Fair Credit Reporting Act
An insured owns an individual Disability Income policy with a 30-day Elimination Period for sickness
and accidents and a monthly indemnity benefit of $500. If the insured is disabled for 3 1/2 months,
what is the MAXIMUM amount he would receive for an approved claim? - CORRECT ANSWER-$1,250
J has a Disability Income policy that does NOT provide benefits for losses occurring as the result of
his employment. What kind of coverage is this? - CORRECT ANSWER-Nonoccupational coverage
An individual Disability Income insurance applicant may be required to submit all of the following
information EXCEPT - CORRECT ANSWER-spouse's occupation
V is insured under an individual Disability Income policy with a 30-day Elimination period. On July 1,
he is involved in an accident and temporarily disabled. He returns to work on December 1. How
many months of benefit are payable? - CORRECT ANSWER-4 months
Disability policies do NOT normally pay for disabilities arising from which of the following? -
CORRECT ANSWER-war
What is the elimination period of an individual disability policy? - CORRECT ANSWER-Time period a
disabled person must wait before benefits are paid
What does a Guaranteed Insurability rider provide a Disability Income policyowner? - CORRECT
ANSWER-The ability to periodically increase the amount of coverage without evidence of insurability
,B is a teacher who was injured in a car accident and cannot work. She is now receiving monthly
benefits as a result of this accident. Which type of policy does B have? - CORRECT ANSWER-Disability
Income
In a Disability Income policy, which of these clauses acts as a deductible? - CORRECT ANSWER-
Elimination period
When a person returns to work after a period of total disability but cannot earn as much as he or she
did before the disability, this situation is called which of the following? - CORRECT ANSWER-Residual
disability
T has Disability Income policy that pays a monthly benefit of $5000. If T becomes partially disabled,
what can he likely expect? - CORRECT ANSWER-Less than $5,000 per month benefit regardless of the
cause
Which of the following is the MOST important factor when deciding how much Disability Income
coverage an applicant should purchase? - CORRECT ANSWER-Applicant's monthly income
R had received full disability income benefits for 6 months. When he returns to work, he is only able
to resume half his normal daily workload. Which provision pays reduced benefits to R while he is not
working at full capacity? - CORRECT ANSWER-Residual disability
With Disability Income insurance, an insurance company may limit the monthly benefit amount a
prospective policy holder may obtain because of the insured's - CORRECT ANSWER-gross income at
the time of purchase
K becomes ill after traveling overseas and is unable to work for 3 months. What kind of policy would
cover her loss of income? - CORRECT ANSWER-Disability Income
D is an architect receiving Disability Income benefits who is not able to return to work full time, but
can work on a part-time basis. Which of these features would allow D to continue receiving benefits?
- CORRECT ANSWER-Residual Benefit clause
Non-occupational disability coverage is designed for: - CORRECT ANSWER-employees who suffer
non-work related disabilities, since work-related disabilities are covered by Workers' Compensation
,A nonprofit incorporated society that does not have capital stock and operates for the sole benefit
of its members is known as: - CORRECT ANSWER-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? - CORRECT ANSWER-Fair Credit Reporting Act
Who elects the governing body of a mutual insurance company? - CORRECT ANSWER-Policyholders
A group-owned insurance company that is formed to assume and spread the liability ricks of its
members is known as a: - CORRECT ANSWER-Risk retention group
What type of reinsurance contract involves two companies automatically sharing their risk
exposure? - CORRECT ANSWER-treaty
What year was the McCarran-Ferguson Act enacted? - CORRECT ANSWER-1945
Which of these describe a participating life insurance policy? - CORRECT ANSWER-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? - CORRECT ANSWER-Upon completion of the application
Which of the following requires insurers to disclose when an applicant's consumer or credit history is
being investigated: - CORRECT ANSWER-1970 - Fair Credit Reporting Act
What type of reinsurance contract involves two companies automatically sharing their risk
exposure? - CORRECT ANSWER-Treaty
A group-owned insurance company that is formed to assume and spread the liability risks of its
members is known as a: - CORRECT ANSWER-risk retention group
All of the following are considered to be typical characteristics describing the nature of an insurance
contract, EXCEPT: - CORRECT ANSWER-Bilateral
, The part of a life insurance policy guaranteed to be true is called a(n) - CORRECT ANSWER-warranty
Statements made on an insurance application that are believed to be true to the best of the
applicant's knowledge are called - CORRECT ANSWER-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? - CORRECT ANSWER-Aleatory
When must insurable interest be present in order for a life insurance policy to be valid? - CORRECT
ANSWER-When the application is made
A life insurance arrangement which circumvents insurable interest statutes is called: - CORRECT
ANSWER-Investor-Originated Life Insurance
Stranger Originated Life Insurance (STOLI) has been found to be in violation of which of the following
contractual elements? - CORRECT ANSWER-Legal Purpose (Insurable Interest)
Who makes the legally enforceable promises in a unilateral contract? - CORRECT ANSWER-Insurance
company
A policy of adhesion can only be modified by whom? - CORRECT ANSWER-insurance company
When third-party ownership is involved, applicants who also happen to be the stated primary
beneficiary are required to have: - CORRECT ANSWER-insurable interest in the proposed insured
Which of these is considered a statement that is assured to be true in every aspect? - CORRECT
ANSWER-Warranty
Which of these require an offer, acceptance, and consideration? - CORRECT ANSWER-contract
If a contract of adhesion contains complicated language, to whom would the interpretation be in
favor of? - CORRECT ANSWER-insured
