FL LIFE AND HEALTH INSURANCE 2-15 STUDY EXAM – QUESTIONS
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EXAM UPDATE
1. Which risk is generally insurable?
A. Speculative risk
B. Pure risk
C. Investment risk
D. Market risk
Correct Answer: B. Pure risk
Rationale: Pure risks involve only the chance of loss or no loss, making them suitable for
insurance.
2. What is the consideration given by an insured in an insurance contract?
A. Benefits
B. Premiums and statements in the application
C. Dividends
D. Policy loans
Correct Answer: B. Premiums and statements in the application
Rationale: The insured's consideration consists of premium payments and truthful application
statements.
3. A contract of adhesion is prepared by:
A. The insured
B. The beneficiary
C. The insurer
D. The producer
Correct Answer: C. The insurer
Rationale: Insurance contracts are drafted by insurers and interpreted in favor of the insured
when ambiguous.
4. Which policy provision prevents an insurer from denying a claim after a policy has been in
force for a specified period?
A. Reinstatement
B. Grace period
C. Incontestability
D. Entire contract
Correct Answer: C. Incontestability
Rationale: The incontestability clause limits the insurer's ability to void coverage after a
stated period.
5. What is the primary purpose of life insurance?
A. To create a loss
B. To indemnify property losses
C. To provide financial protection against premature death
D. To cover liability claims only
Correct Answer: C. To provide financial protection against premature death
, Rationale: Life insurance protects beneficiaries from financial hardship resulting from an
insured's death.
6. Who receives the death benefit in a life insurance policy?
A. Producer
B. Beneficiary
C. Insurer
D. Underwriter
Correct Answer: B. Beneficiary
Rationale: The beneficiary is designated to receive policy proceeds.
7. Which type of life insurance provides coverage for a specified period?
A. Whole life
B. Universal life
C. Term life
D. Variable life
Correct Answer: C. Term life
Rationale: Term insurance provides protection for a stated period only.
8. Whole life insurance is characterized by:
A. Temporary protection
B. Cash value accumulation
C. No premiums
D. Annual renewability only
Correct Answer: B. Cash value accumulation
Rationale: Whole life policies build guaranteed cash values over time.
9. Universal life insurance offers:
A. Fixed premiums only
B. Flexible premiums and adjustable benefits
C. No death benefit
D. Limited coverage periods
Correct Answer: B. Flexible premiums and adjustable benefits
Rationale: Universal life allows flexibility in premium payments and death benefits.
10. Which life insurance policy combines insurance protection with investment choices?
A. Term life
B. Whole life
C. Variable life
D. Credit life
Correct Answer: C. Variable life
Rationale: Variable life policies allow policyowners to allocate cash values among investment
accounts.
11. The policyowner has the right to:
A. Change the insurer
B. Change beneficiaries unless irrevocable
C. Approve claims only
D. Set state laws
AND ANSWERS | VERIFIED AND WELL DETAILED ANSWERS | PLUS
RATIONALES MUST BE IN ITALICS| GUARANTEED PASS | LATEST
EXAM UPDATE
1. Which risk is generally insurable?
A. Speculative risk
B. Pure risk
C. Investment risk
D. Market risk
Correct Answer: B. Pure risk
Rationale: Pure risks involve only the chance of loss or no loss, making them suitable for
insurance.
2. What is the consideration given by an insured in an insurance contract?
A. Benefits
B. Premiums and statements in the application
C. Dividends
D. Policy loans
Correct Answer: B. Premiums and statements in the application
Rationale: The insured's consideration consists of premium payments and truthful application
statements.
3. A contract of adhesion is prepared by:
A. The insured
B. The beneficiary
C. The insurer
D. The producer
Correct Answer: C. The insurer
Rationale: Insurance contracts are drafted by insurers and interpreted in favor of the insured
when ambiguous.
4. Which policy provision prevents an insurer from denying a claim after a policy has been in
force for a specified period?
A. Reinstatement
B. Grace period
C. Incontestability
D. Entire contract
Correct Answer: C. Incontestability
Rationale: The incontestability clause limits the insurer's ability to void coverage after a
stated period.
5. What is the primary purpose of life insurance?
A. To create a loss
B. To indemnify property losses
C. To provide financial protection against premature death
D. To cover liability claims only
Correct Answer: C. To provide financial protection against premature death
, Rationale: Life insurance protects beneficiaries from financial hardship resulting from an
insured's death.
6. Who receives the death benefit in a life insurance policy?
A. Producer
B. Beneficiary
C. Insurer
D. Underwriter
Correct Answer: B. Beneficiary
Rationale: The beneficiary is designated to receive policy proceeds.
7. Which type of life insurance provides coverage for a specified period?
A. Whole life
B. Universal life
C. Term life
D. Variable life
Correct Answer: C. Term life
Rationale: Term insurance provides protection for a stated period only.
8. Whole life insurance is characterized by:
A. Temporary protection
B. Cash value accumulation
C. No premiums
D. Annual renewability only
Correct Answer: B. Cash value accumulation
Rationale: Whole life policies build guaranteed cash values over time.
9. Universal life insurance offers:
A. Fixed premiums only
B. Flexible premiums and adjustable benefits
C. No death benefit
D. Limited coverage periods
Correct Answer: B. Flexible premiums and adjustable benefits
Rationale: Universal life allows flexibility in premium payments and death benefits.
10. Which life insurance policy combines insurance protection with investment choices?
A. Term life
B. Whole life
C. Variable life
D. Credit life
Correct Answer: C. Variable life
Rationale: Variable life policies allow policyowners to allocate cash values among investment
accounts.
11. The policyowner has the right to:
A. Change the insurer
B. Change beneficiaries unless irrevocable
C. Approve claims only
D. Set state laws
