Florida Life and Health Insurance
Questions with Accurate Answers
Insured - ANSWERSThe person covered by the insurance policy.
Rider - ANSWERSA written modification attached to a policy that increases or
decreases coverage and/or premiums.
What is a unilateral contract? - ANSWERSA 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?
- ANSWERSThe Fair Credit Reporting Act.
What are the three types of agent authority? - ANSWERSImplied, Express, and
Apparent.
Agent - ANSWERSAn 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? - ANSWERSUnderwriting
The requirement that agents must account for and promptly remit all insurance funds
collected is known as what type of agent responsibility? - ANSWERSFiduciary
What is a third-party ownership? - ANSWERSAn insurance arrangement in which the
policy owner and the insured are not the same person.
Suitability - ANSWERSFactors that determine if an insurance product is appropriate for
a particular customer.
Premium - ANSWERSA payment by the policy owner to the insurance company to keep
the policy in force.
Disclosure - ANSWERSProviding 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? - ANSWERSRebating
,If an insurer meets the states financial requirements and is approved to transact
business in the state, it is considered what type of insurer? - ANSWERSAuthorized
What information are the members of the medical information bureau required to
report? - ANSWERSAdverse medical information about the applicants or insureds.
What type of beneficiary can be changed at any point by the policy owner? -
ANSWERSRevocable
What document describes the specific information about a policy? - ANSWERSPolicy
Summary
What is the term for the causes of loss insured against in an insurance policy? -
ANSWERSPeril
Whom does an insurance agent represent? - ANSWERSInsurance Company
What is an unfair trade practice? - ANSWERSAny fraudulent, deceptive, or dishonest
business practice that is prohibited by statutes and regulations.
Insurer - ANSWERSThe company that issues an insurance policy.
Peril - ANSWERSCause of loss
Contract of Adhesion - ANSWERSA 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? - ANSWERSAgreement (Offer
and Acceptance), consideration, competent parties, and legal purpose.
Policy Provision - ANSWERSA clause that stipulates the rights and obligations under an
insurance contract.
Fiduciary - ANSWERSA producer who handles insurer's funds in a trust capacity.
Who is considered a nonresident agent? - ANSWERSAn agent who resides and is
licensed in another state, but is authorized to transact insurance in Florida.
What is underwriting? - ANSWERSThe risk selection and classification process.
What is the best way to handle incomplete insurance applications? - ANSWERSReturn
the application to the applicant for completion.
What are the five characteristics of an ideally insurable risk? - ANSWERSLoss 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? -
ANSWERSGroup Policy
What is the purpose of a free-look period? - ANSWERSTo 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? - ANSWERSThe Agent's
What types of licensee represents the insurance company? - ANSWERSAgent
Who must be notified of the producers change of address? - ANSWERSThe department
of Insurance
Certificate of Insurance - ANSWERSA document issued to insureds under a group plan
that states the coverage being issued, and indicates the coverage type and amounts.
Nonrenewal - ANSWERSTermination of a policy by an insurer on the anniversary or
renewal date.
Representation - ANSWERSA statement made by the applicant on the insurance
application that is believed to be true.
What is a warranty? - ANSWERSAn absolutely true statement that, if breached, may
viod an insurance contract.
In insurance, when is the offer usually made on a contract? - ANSWERSWhen 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? - ANSWERSComplete 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? - ANSWERSPure Risk
Who is responsible for the contents of insurance advertisements? - ANSWERSThe
Insurance Company
What is the entire contract in health insurance underwriting? - ANSWERSThe policy
with riders and endorsements, plus a copy of the application.
Questions with Accurate Answers
Insured - ANSWERSThe person covered by the insurance policy.
Rider - ANSWERSA written modification attached to a policy that increases or
decreases coverage and/or premiums.
What is a unilateral contract? - ANSWERSA 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?
- ANSWERSThe Fair Credit Reporting Act.
What are the three types of agent authority? - ANSWERSImplied, Express, and
Apparent.
Agent - ANSWERSAn 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? - ANSWERSUnderwriting
The requirement that agents must account for and promptly remit all insurance funds
collected is known as what type of agent responsibility? - ANSWERSFiduciary
What is a third-party ownership? - ANSWERSAn insurance arrangement in which the
policy owner and the insured are not the same person.
Suitability - ANSWERSFactors that determine if an insurance product is appropriate for
a particular customer.
Premium - ANSWERSA payment by the policy owner to the insurance company to keep
the policy in force.
Disclosure - ANSWERSProviding 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? - ANSWERSRebating
,If an insurer meets the states financial requirements and is approved to transact
business in the state, it is considered what type of insurer? - ANSWERSAuthorized
What information are the members of the medical information bureau required to
report? - ANSWERSAdverse medical information about the applicants or insureds.
What type of beneficiary can be changed at any point by the policy owner? -
ANSWERSRevocable
What document describes the specific information about a policy? - ANSWERSPolicy
Summary
What is the term for the causes of loss insured against in an insurance policy? -
ANSWERSPeril
Whom does an insurance agent represent? - ANSWERSInsurance Company
What is an unfair trade practice? - ANSWERSAny fraudulent, deceptive, or dishonest
business practice that is prohibited by statutes and regulations.
Insurer - ANSWERSThe company that issues an insurance policy.
Peril - ANSWERSCause of loss
Contract of Adhesion - ANSWERSA 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? - ANSWERSAgreement (Offer
and Acceptance), consideration, competent parties, and legal purpose.
Policy Provision - ANSWERSA clause that stipulates the rights and obligations under an
insurance contract.
Fiduciary - ANSWERSA producer who handles insurer's funds in a trust capacity.
Who is considered a nonresident agent? - ANSWERSAn agent who resides and is
licensed in another state, but is authorized to transact insurance in Florida.
What is underwriting? - ANSWERSThe risk selection and classification process.
What is the best way to handle incomplete insurance applications? - ANSWERSReturn
the application to the applicant for completion.
What are the five characteristics of an ideally insurable risk? - ANSWERSLoss 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? -
ANSWERSGroup Policy
What is the purpose of a free-look period? - ANSWERSTo 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? - ANSWERSThe Agent's
What types of licensee represents the insurance company? - ANSWERSAgent
Who must be notified of the producers change of address? - ANSWERSThe department
of Insurance
Certificate of Insurance - ANSWERSA document issued to insureds under a group plan
that states the coverage being issued, and indicates the coverage type and amounts.
Nonrenewal - ANSWERSTermination of a policy by an insurer on the anniversary or
renewal date.
Representation - ANSWERSA statement made by the applicant on the insurance
application that is believed to be true.
What is a warranty? - ANSWERSAn absolutely true statement that, if breached, may
viod an insurance contract.
In insurance, when is the offer usually made on a contract? - ANSWERSWhen 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? - ANSWERSComplete 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? - ANSWERSPure Risk
Who is responsible for the contents of insurance advertisements? - ANSWERSThe
Insurance Company
What is the entire contract in health insurance underwriting? - ANSWERSThe policy
with riders and endorsements, plus a copy of the application.
