1. Florida Statutes, Rules, and Regulations Common to All Lines
What is the minimum age that a person can obtain a life insurance license?
18
Continuing education requirements must be met every
2 years in courses approved by the department
A licensed agent must complete how many hours of continuing education specific to ethics and regulatory updates?
5 hours
What are the most common penalties for violations of insurance statutes?
A cease and desist order, a fine, and license suspension or revocation
Who is an insurance agent?
A person authorized to sell, solicit and negotiate insurance contracts
Which of the following is true regarding the agent's appointments?
A person may hold several appointments at one time
Which of the following would be required to be licensed as an insurance producer?
A salaried employee who advertises and solicits insurance
Which of the following is another term for an authorized insurer?
Admitted
Which of the following NOT be a violation of state insurance regulations?
Agent C- uses her license to write only business other than controlled
Which of the following is true regarding branch agency licensing?
Agent in charge must be licensed
Who must be a member of insurance guaranty associations?
All insurers authorized to write insurance within a state
Who is considered a nonresident agent?
An agent who resides and is licensed in another state, but who is authorized to transact insurance in this state
What is a foreign insurer?
An insurer with a home office in another state
How often must domestic insurance companies be examined by the Chief Financial Officer in Florida?
At least every 5 years
If an insurer holds a Certificate of Authority, it is known as what type of insurer?
Authorized or admitted
If an insurer meets the state's financial requirements and is approved to transact business in the state, it is considered what type of insurer?
Authorized or admitted
What type of licensee represents the insured?
Broker
If the Commissioner/Superintendent finds a licensee engaging in an unfair method of competition or an unfair practice, what order will be issued?
Cease and desist order
Which of the following must an insurer obtain in order to transact insurance within a given state?
Certificate of authority
What are producers required to do in order to renew their license?
Complete continuing education hours and pay a renewal
If a producer makes maliciously critical statements about another insurer, what is this illegal practice called?
Defamation
Two individuals who are in the same risk and age class are charged different rates for their insurance policies due to an insignificant factor. What is this called?
Discrimination
Which of the following is NOT a responsibility of the Office of insurance regulations?
Enacting new insurance laws
The requirement that agents not commingle insurance monies with their own funds is known as
Fiduciary responsibility
For what reason can a temporary license be issued?
For continuation of business in case the licensed producer dies or becomes disabled
An insurance company is domiciled in Montana and transacts insurance in Wyoming. Which term best describes the insurer's classification in Wyoming?
Foreign
Which of the following entities is not an insurer but an organization formed to provide insurance benefits for members of an affiliated lodge or religious organization
Fraternal benefit society
All of the following are the general qualifications for an agent's license EXCEPT
Have.a high school diploma
which of the following entities protects policyowners, insureds, and beneficiaries under insurance contracts when insurers fail to perform contractual obligations due to financial impairment?
Insurance Guaranty Association
In general, who can be excluded from producer licensing and examination examination requirements?
Insurance company officers, directors, or any other employees who do not transact insurance and who do not receive commissions for their services (usually, their responsibilities include administrative, executive or clerical)
What is the controlled business?
Insurance on the producer's own life or property, or the lives or property of the producer's family or business associates
Insurance contracts are agreements between which two parties?
Insurer and policyowner
Which of the following is NOT true regarding a certificate of authority?
It is issued to group insurance participants
What illegal act does a producer commit when the producer represents a policy in a more favorable light than the policy really is?
Misrepresentation
Can insurers advertise the existence of the guaranty association during solicitation and sale of insurance policies?
No, advertising of the existence of the guaranty association for the purposes of solicitation and sale of insurance policies by insurers is an illegal business practice
Who may share in the commission from the sale of a life insurance policy?
Only producers properly licensed for the type of insurance transaction
A participating insurance policy may do which of the following?
Pay dividends to the policyowner
Who might receive dividends from a mutual insurer?
Policyholders
Who can usually be granted a temporary license?
Producer's spouse or designee in case the licensed producer dies or becomes disabled
Pertaining to insurance, what is the definition of a fiduciary responsibility?
Promptly forwarding premiums to the insurance company
An agent offers a client free tickets to a sporting event in exchange for the purchase of an insurance policy. What is the agent guilty of?
Rebating
Any inducement offered to the insured in the sale of an insurance policy that is not specified in the policy is an unlawful practice known as
Rebating
Which of the following insurers are owned by stockholders?
Stock insurance companies
Who owns stock companies?
Stockholders
What type of licensee represents the insurance company?
The agent
If an agent is in the military, which of the following is true?
The agent cannot sell a policy to another active military person who is of a lower rank
Who must be notified of a producer's change of address?
The department of Insurance (commissioner/director/ superintendent)
Who is responsible for the contents of insurance advertisements?
The insurance company
Who is responsible for the costs associated with examination of insurers?
The insurer who is being examined
Which of the following entities is responsible for agent licensing and administrative supervision
The office of insurance regulation
In accordance to the code of ethics, agents must provide a completed application to
The prospective insured and the insurer
Which of the following is an example of a producer's fiduciary duty?
The trust that a client places in the producer in regard to handling premiums
To whom may a certificate of authority be issued?
To an insurer authorized to transact business in this state
what is the purpose of a cease and desist order?
To prevent a producer or insurer from further violating laws for transacting insurance
What is the purpose of insurance guaranty associations?
To protect policyowners, insureds and beneficiaries from financial losses caused by insolvent insurers
Which type of misrepresentation persuades an insured, to his or her detriment, to cancel, lapse, or switch policies from one to another?
Twisting
An insured submits a proof of loss form within 10 days of a loss. The insurer, however, does not acknowledge the form for 3 months. Which of the following violations has the insurer committed?
Unfair claims of settlement
When can the commissioner or direct examine insurers?
Whenever deemed necessary, but at least once every few years (please check your state regulations for specific time requirement)
What document is required for an insurance company to transact insurance?
certificate of authority
When a producer was reviewing a potential customer's coverage written by another company, the producer made several remarks that were maliciously critical of that other insurer. The producer could be found guilty of
defamation
The office of insurance regulations is responsible for all of the following insurer activities Except
issue of securities
On its advertisement, a company claims that it has funds in its possession that are, in fact, not available for the payment of losses or claims. What is the company guilty of?
misrepresentation
An insured purchased an insurance policy 5 years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insurer. From what type of insurer did the insured purchase the policy?
mutual
All of the following would be considered an insurance transaction EXCEPT
obtaining an insurance license
In what way can an agent demonstrate a high standard of ethics?
putting the client's best interests before their own
Insurers are classified according to their domicile. What are the three types of insurers?
Domestic, foreign, and alien
Under what circumstances can an agent's appointment be transferred to another person?
Under no circumstances
In order to maintain an insurance license, an agent will need to satisfy Florida's continuing education requirement
24 hours of continuing education in every 2-year period
Which of the following best describes misrepresentation?
issuing sales materials with exaggerated statements about policy benefits
