Florida Health Insurance Exam
Questions with Verified Answers
Rules of Construction - ✔✔Help to identify and establish the intent of the parties to the
contract
Utmost good faith - ✔✔Each party is entitled to rely on the representation of the other, and
each party should have a reasonable expectation that the other is acting in good faith without
attempts to conceal or deceive.
Aleatory Contract - ✔✔A contract under which one party's performance is contingent on an
uncertain event.
property and casualty agent - ✔✔has the power to bind the insurer
Adhesion Contract - ✔✔Insurance company drafts contract and the insured adheres to it. Any
ambiguity resolved in favor of the insured.
Unilateral contract - ✔✔Insured has completed paying the premium, only one party of the
contract is legally required to do something. Insured promises to pay the death benefit in the
event of loss. Can not be held for breach of contract.
Conditional contract - ✔✔This type of contract is conditional because the company only pays
on condition of a loss.
Personal Contract - ✔✔The contract is between the insured and the insurer
warranty - ✔✔guarantee; assurance by seller. Any breach provides grounds for voiding the
contract.
,representation - ✔✔a statement believed to be true to the best of one's knowledge.
false pretenses - ✔✔When an uninsurable individual applying for insurance may ask another
person to substitute for him to take the physical examination.
Misrepresentation - ✔✔A false statement or lie that can render the contract void.
concealment (n) - ✔✔The failure to disclose material facts. Grounds for recission by either
party.
Material Information or facts - ✔✔Something crucial to acceptance of the risk.
fraud (n) - ✔✔An intentional act designed to deceive and induce another party to part with
something of value.
Parol Evidence Rule - ✔✔Rule of law disallowing oral evidence which disputes a written
agreement.
Voidable Contract - ✔✔A contract that may be legally avoided at the option of one or both of
the parties.
Void Contract - ✔✔an agreement of no legal effect.
Implied Authority - ✔✔Authority that is given not in writing but that is necessary for the agent
to transact insurance.
Apparent Authority - ✔✔A third party's reasonable belief that an agent has authority to act on
the principal's behalf.
, Express Authority - ✔✔the authority of an agent, stated in the document or agreement creating
the agency.
Lingering implied authority - ✔✔means that the agent carries "signs or evidences of authority.
Estoppel - ✔✔A legal impediment to denying a fact or restoring a right that has been previously
waived.
Valid Contract (Legal Contract) - ✔✔one that meets all of the requirements of a binding
contract. Competent parties, legal purpose, and consideration, not an actual written document.
Policyfolder - ✔✔Important documents with a custom folder.
Plan Sponsors - ✔✔Policyholder responsible for administering pan and making premiums to
insurance company.
Employee or individual employer group - ✔✔Employer is the policy-owner and establishes
eligible class of employees to be covered under group policy.
Multiple employer group - ✔✔Several employers forming a trust to combine their workers for
life insurance eligibility.
Multiple Employer Trust (MET) - ✔✔A legal entity of small business owners grouped together
to buy life insurance.
Taft-Hartley Act - ✔✔a law that restricted the power of labor unions
Questions with Verified Answers
Rules of Construction - ✔✔Help to identify and establish the intent of the parties to the
contract
Utmost good faith - ✔✔Each party is entitled to rely on the representation of the other, and
each party should have a reasonable expectation that the other is acting in good faith without
attempts to conceal or deceive.
Aleatory Contract - ✔✔A contract under which one party's performance is contingent on an
uncertain event.
property and casualty agent - ✔✔has the power to bind the insurer
Adhesion Contract - ✔✔Insurance company drafts contract and the insured adheres to it. Any
ambiguity resolved in favor of the insured.
Unilateral contract - ✔✔Insured has completed paying the premium, only one party of the
contract is legally required to do something. Insured promises to pay the death benefit in the
event of loss. Can not be held for breach of contract.
Conditional contract - ✔✔This type of contract is conditional because the company only pays
on condition of a loss.
Personal Contract - ✔✔The contract is between the insured and the insurer
warranty - ✔✔guarantee; assurance by seller. Any breach provides grounds for voiding the
contract.
,representation - ✔✔a statement believed to be true to the best of one's knowledge.
false pretenses - ✔✔When an uninsurable individual applying for insurance may ask another
person to substitute for him to take the physical examination.
Misrepresentation - ✔✔A false statement or lie that can render the contract void.
concealment (n) - ✔✔The failure to disclose material facts. Grounds for recission by either
party.
Material Information or facts - ✔✔Something crucial to acceptance of the risk.
fraud (n) - ✔✔An intentional act designed to deceive and induce another party to part with
something of value.
Parol Evidence Rule - ✔✔Rule of law disallowing oral evidence which disputes a written
agreement.
Voidable Contract - ✔✔A contract that may be legally avoided at the option of one or both of
the parties.
Void Contract - ✔✔an agreement of no legal effect.
Implied Authority - ✔✔Authority that is given not in writing but that is necessary for the agent
to transact insurance.
Apparent Authority - ✔✔A third party's reasonable belief that an agent has authority to act on
the principal's behalf.
, Express Authority - ✔✔the authority of an agent, stated in the document or agreement creating
the agency.
Lingering implied authority - ✔✔means that the agent carries "signs or evidences of authority.
Estoppel - ✔✔A legal impediment to denying a fact or restoring a right that has been previously
waived.
Valid Contract (Legal Contract) - ✔✔one that meets all of the requirements of a binding
contract. Competent parties, legal purpose, and consideration, not an actual written document.
Policyfolder - ✔✔Important documents with a custom folder.
Plan Sponsors - ✔✔Policyholder responsible for administering pan and making premiums to
insurance company.
Employee or individual employer group - ✔✔Employer is the policy-owner and establishes
eligible class of employees to be covered under group policy.
Multiple employer group - ✔✔Several employers forming a trust to combine their workers for
life insurance eligibility.
Multiple Employer Trust (MET) - ✔✔A legal entity of small business owners grouped together
to buy life insurance.
Taft-Hartley Act - ✔✔a law that restricted the power of labor unions
