Florida 2-15 Insurance Final Exam Test Bank (All Chapters complete 1-30, Questions and Answers, 100% Verified) Latest 2023/2024

Florida 2-15 Insurance Final Exam Test Bank (All Chapters complete 1-30, Questions and Answers, 100% Verified) Latest 2023/2024 1. A life insurance company is organized in Orlando where it maintains its home office. In Florida, the company is classified as a a. domestic company b. local company c. foreign company d. preferred company a 2. With regard to life insurance, all of the following statements are correct EXCEPT a. all individuals are considered to have insurable interests in themselves b. spouses are automatically considered to have insurable interest in each other c. a creditor has an insurable interest in a debtor d. insurable interest must be maintained throughout the life of the contract d 3. With ten partners in a corporation, how many life insurance policies would be required to insure a cross-purchase buy-sell plan? a. 1 b. 10 c. 90 d. 100 c 4. All of the following statements about variable annuities are correct EXCEPT a. Variable products are regulated by the SEC and the Office of Insurance Regulation. b. The consumer directs the investments of the product. c. An annuitized variable annuity will provide a level income amount to the annuitant for life. d. Variable annuities are sold by insurance companies. c 5. All of the following statements regarding policy replacement are correct EXCEPT a. replacement involves convincing a policyholder to lapse or terminate an existing policy and to purchase another b. interrupting one cash value insurance plan to begin another could cause serious financial problems for the policy owner c. even if the customer wants to replace his or her existing policy, an agent can effect a policy replacement only by following the replacement regulations in his or her state d. premiums for replacement policies are generally lower than premiums for the existing policy they replace d 6. How are accumulation unit gains taxed? a. Gains in accumulation units are taxed as ordinary income. b. Gains in accumulation units are taxed as capital gains. c. Gains in accumulation units are taxed using the exclusion ratio. d. Gains in accumulation units are not taxed d 7. After a family's breadwinner dies, the "blackout period" generally can be defined as the period a. during which children are living at home b. that begins with the youngest child turns 16 and ends with the surviving parent retires c. during which children are in school d. from the surviving parent's retirement to death b 8. All of the following approaches are used by insurers to determine benefits payable under basic surgical expense insurance EXCEPT a. relative value scale approach b. traditional net cost method c. reasonable and customary approach d. surgical schedule method b 9. When may a health insurance company change the wording of a uniform policy provision? a. It may only be changed if approved by the Office of Insurance Regulation. b. It may only be changed if the new wording is not less favorable to the insurer. c. It may only be changed if the new wording is not less favorable to the insured. d. It may only be changed if the new wording is more favorable to the insurer. c 10. The surviving spouse may begin receiving retirement benefits as early as what age? a. 59 1/2 b. 60 c. 62 d. 65 b 11. Beth's health insurance policy contains a provision that allows her to renew coverage up to age 65. However, the policy also states that should Beth lose her job, the insurance company will cancel the policy, regardless of Beth's age. In terms of renewability, what type of policy does Beth have? a. Cancellable b. Optionally renewable c. Guaranteed renewable d. Conditionally renewable d 12. Which of the following constitutes an insurable interest? a. The policy owner must expect to benefit from the insured's death. b. The policy owner must expect to suffer a loss when the insured dies or becomes disabled. c. The beneficiary, by definition, has an insurable interest in the insured. d. The insured must have a personal or business relationship with the beneficiary. b 13. Which of the following is NOT included in the definition of "transacting insurance"? a. issuing an insurance policy b. accepting an insurance application c. underwriting a policy d. accepting a premium payment c Which of the following is CORRECT? a. Applicants cannot dispute their consumer reports. b. Applicants will be notified by the credit reporting agency that the application for life insurance has been rejected. c. If the applicant requests their credit report, the insurance company must provide a copy of one. d. Insurance companies have to notify applicants within a few days that a consumer report has been requested. d 15. All of the following are features of an equity indexed product EXCEPT: a. Equity index products are usually invested in the S&P 500. b. Equity index products allow the contract holder to direct the investments. c. Equity index products are primarily for accumulation. d. Equity index products guarantee a minimum interest rate. b 16. Regular notices sent to policy-owners for payment of their life insurance policy premiums reflect a. gross premium b. net level premium c. net single premium d. none of the above a 17. Which of the following is NOT true of term insurance? a. Cash values do not accumulate with term insurance. b. Coverage under term insurance is temporary. c. Cash values build during the specified period of temporary coverage. d. Benefits are payable if death occurs during a specific time period. c 18. The parole evidence rule says a. Oral evidence is accounted for before written evidence. b. Signed contracts cannot be changed. c. Written contracts cannot be changed by oral evidence. d. Oral contracts cannot be changed by written contracts. c 19. Leonard owns a major medical health policy which requires him to pay the first $200 of covered expenses each year before the policy pays its benefits. The $200 is the policy's a. coinsurance amount b. deductible c. stop-loss amount d. annual premium b 20. Mary is enrolled in Medicare Parts A and B. She is hospitalized for two weeks and sent home. Four weeks later she is readmitted to the hospital for a separate issue and stays in the hospital for a week. Under her Medicare benefits, which of the following will happen during her second stay of a week? a. She will pay a deductible. b. She will pay a deductible and daily coinsurance amount. c. She will pay no deductible but will pay a daily coinsurance amount. d. She will pay neither a deductible nor a daily coinsurance amount. d 21. A basic surgical expense policy that covers surgeons' fees per a schedule approach a. bases its benefits on what is customary for a particular area b. assigns a set of points to each surgical procedure c. assigns a dollar amount to each surgical procedure d. bases its benefits on a percentage of hospital room and board expenses c 22. Individual health insurance policies are typically written on which basis? a. Participating b. Nonparticipating c. Experience-rated d. Claims-rated b 23. The State Guaranty Association a. guarantees issuance of policies b. guarantees claims are paid if an insurer becomes insolvent c. guarantees dividends d. guarantees the rate of return on a policy b 24. All of the following are elements of an insurable risk EXCEPT a. the loss must be due to chance b. the loss must be predictable c. the loss must be catastrophic d. the loss must have a determinable value c 25. Which of the following best describes underwriting? a. Evaluating and classifying risk categories. b. Risk selection and policy issue. c. Risk selection, reporting of medical information, and rejection or policy issue. d. Risk selection, classification and rating. d 26. Frank is the insured in a $40,000 five-year level term policy issued in 2000. He died in 2006. His beneficiary received a. nothing b. $20,000 c. $40,000 d. the cash value of the policy a 27. If a life insurance applicant is given a binding receipt, when does his or her coverage become effective? a. Date the policy is issued b. Date the applicant proves to be insurable c. Date the receipt is given d. Date the policy is delivered c 28. Mr. A purchased a Hospital Indemnity policy to protect against catastrophic medical expenses. This would be an example of: a. risk avoidance b. risk transference c. risk reduction d. risk retention b 29. Mr. Ritchie, a taxidermist, is insured under a business overhead expense policy that pays maximum monthly benefits of $2,000. Mr. Ritchie becomes disabled. His actual monthly expenses are $2,700. The monthly benefits payable under his policy will be a. $1,300 b. $2,000 c. $2,350 d. $2,700 b 30. A waiver of premium provision may be included with which kind of health insurance policy? a. Hospital indemnity b. Major medical c. Disability income d. Basic medical c 31. What constitutes "consideration" for a life insurance policy? a. Application and initial premium b. Agent's commission c. Adhesion feature of the contract d. Policy's benefits a 32. Health maintenance organizations are known for stressing the provision of a. preventive care b. health care and services on a fee-for-services-rendered basis c. reimbursement approach d. right of assignment approach a 33. Trudy, age 53, owns both a traditional IRA and a Roth IRA. All of the following are possible contribution combinations EXCEPT a. $5,500 into the traditional IRA and $5,500 into the Roth IRA b. $5,500 into the traditional IRA and $0 into the Roth IRA c. $0 into the traditional IRA and $5,500 into the Roth IRA d. $0 into the traditional IRA and $0 into the Roth IRA a 34. Which of the following legal terms indicates that a life insurance contract contains the enforceable promises of only one party? a. Adhesion b. Unilateral c. Conditional d. Aleatory b 35. All of the following are characteristics of group health insurance plans EXCEPT a. their benefits are more extensive than those under individual plans b. the parties to a group health contract are the employer and the employees c. employers may require employees to contribute to the premium payments d. the cost of insuring an individual is less than what would be charged for comparable benefits under and individual plan b 36. Which of the following statements regarding policy assignments is correct? a. The policy owner must notify the insurer of the assignment and receive the insurer's permission. b. The procedure required for policy assignment is explained in the policy's insuring clause. c. A policy that has named an irrevocable beneficiary cannot be assigned without that beneficiary's agreement. d. Insurable interest must exist between the insured and the assignee at the time of assignment. c 37. Which is not a primary premium factor? a. expense b. interest c. dividends d. mortality c 38. Assume a home catches fire after it is struck by lightning and the fire destroys the structure and contents. By insurance definition, the fire is the a. risk b. hazard c. peril d. proximate cause c 39. Which renewability provision allows an insurer to terminate a health insurance policy on any date specified in the policy and to increase the premium for any class of insureds? a. Conditionally renewable b. Optionally renewable c. Guaranteed renewable d. Cancellable b 40. When an insured dies, who stands first to receive the policy's proceeds?