Chapter 11 - Laws and Rules
Advertising gifts not to exceed ___ are allowed to be given by an agent to a prospective client.
$100 Explanation: An agent is allowed to give advertising gifts to a prospective customer, provided they do not exceed $100
A life policy loan in Florida cannot charge a fixed rate of interest higher than
10% Explanation: The max fixed interest rate permitted on a life policy loan is 10%
What percentage of eligible persons must a policy cover in a noncontributory group?
100% In a noncontributory group, the policy must cover 100% of eligible persons
The minimum age at which a person can sign a life insurance application is
15 years Explanation: A person 15 years or oldermay contract for life insurance on his/her own life
In Florida, most life insurance policies have a contestability period of
2 years Explanation: The maximum contestability period for most life insurance policies is 2 years
An insurance company can contest a life insurance contract due to application fraud within
2 years Explanation: There is a 2 year time limit for insurer to contest a life insurance contract due to application fraud
In what year was the Florida Office of Financial Regulation (OFR) created?
2003 Explanation: The OFR was created in 2003 as the result of the Cabinet Reorganization Act of 2002
Agents that have been licensed for less than six years must complete __ hours of continuing education every two years.
24 Explanation: Florida agents licensed less than six years are required to complete 24 hours of continuing education
Florida requires that an insurance agent must complete __ hours of continuing education on the subject of law and ethics every two years.
4 Explanation: Florida requires that an insurance agent must complete 4 hours of contiuing education on the subject of law and ethnics every two years
What is Florida's definition of Life insurance replacement?
A transaction in which a new policy is bought and an old policy is terminated Explanation: Florida's Replacement Rule defines replacement of Life Insurance as a transaction in which a new policy is bought and an old policy is discontinued
Which of the following employer tasks does a Professional Employer Organization normally handle?
Administration tasks Explanation: Professional Employer Organization typically handles administration tasks
All of the following entries are classified under the four principal areas of Florida insurance law EXCEPT
An agent's commission Explanation: The payment of commission to the agent is not classified under the four prinicpal of areas of Florida Insurance law but the policyowner rights, policy provision, and an agent's licensing requirements are classified
An example of false advertising would be
An insurer exaggerating its dividends in a magazine advertisement Explanation: An insurance company may be judged guilty of false adertising if it exaggerates its dividends in a magazine advertisement
Which of the following can an agent provide to help a prospective client understand and purchase the most appropriate product?
Buyer's guide Explanation: Agents can help prospective client understand and purchase the most appropriate product by delivering a buyer's guide
The Bureau of Unclaimed Property is overseen by the
Chief Financial Officer Explanation: The Chief Financial Officer oversees the Bureau of Unclaimed Property
As a condition for a loan, a bank requires the borrower to purchase credit insurance from a specific company. What is the bank guilty of?
Coercion Explanation: A credior who requires a debtor to obtain insurance from a particular company or agent as a condition for a loan is guilty of coercion
Any violations of the Florida financial instiutions code may be investigated by the
Department of Financial Services (DFS) Explanation: The DFS has the authority to investigate violations or potential violations of the Florida Financial institution code
In Flordia, which employee is eligible for an employer's group term life plan?
Employee who works more than 40 hours per week
Which of the following is NOT a consequence for placing business with an unauthorized insurer?
First degree misdemeanor Explanation: Third degree felony, insurance license revoked, and responsible for unpaid claims are possible consequences for placing business with an unauthorized insurer EXCEPT First degree misdemeanor
Nonprofit life insurance providers that are covered by a special section in the Florida insurance code are called
Fraternal life insurance organizations Explanation: It is a nonprofit provider of life insurance that is covered by a special section of Florida insurance code
Which of the following employees may NOT be excluded from a group life plan?
Full-time employees afterthe probationary period Explanation: Part time employees, Seasonal workers and Full time employees before the probationary period may be excluded from a group life plan EXCEPT Full-time employees afterthe probationary period
All of these are a prerequisite for becoming a licensed agent EXCEPT
Graduate from high school Explanation: Graduating from high school is not a prerequisite for becoming a licensed agent but completing a prelicensing course, being a resident of Florida and being at least 18 years old is a prerequisite for becoming a licensed agent
Which of the following situation are NOT subject to Florida life insurance laws?
Insurance companies' day-to-day operations Explanation: Florida life insurance laws apply to insurance companies' life policy replacement requirements, insurance companies' setting of life insurance policy rates, insurance companies' guidelines for paying life insurance claim are situation subject to life insurance laws EXCEPT Insurance companies' day-to-day operations
According to Florida Law, which of the ollowing statement accurately describes an admitted mail order insurance company
It may solicit insurance business by ail without the assistance of a licensed agent Explanation: An admitted order mail insurance company may solicit and accept businesss by mail without the aid of a licensed agent
What are adjustable rates for life policy loans in Florida based on?
Moody's corporate bond index Explanation: Adjustable rates for life insurance policy loans in Florida are based on Moody's corporate bond index
Which type of insurance company allows their policyowners to elect a governing body?
Mutual Explanation: Policyholders elect the governing bodies of mutual insurance companies
Which of the following professional organizations has its code of ethnics incorporated into Florida law?
National Association of Insurance and Financial Advisors (NAIFA) Explanation: The professional organization whose code of ethnics is incorporated into Florida law, and whose responsibility is to establish the activities of agents is the NAIFA
What is the purpose of the Insurance Guaranty Fund Association?
Protects policyowners against insolvent insurance companies Explanation: The Insurance Guaranty Fund Associationmis an association the protects policyowners against insolvent insurance companies
Which of these is NOT a legal entity for selling life insurance in Florida?
Risk management advisers Explanation: Risk managment advisers do not qualify as a legal entity for selling life insurance but independent agency system, career ageny system and personal producing general agency are legal entities for selling life insurance in Florida
Which of the following is NOT considered rebating?
Sharing commission with an agent licensed in the same line of business Explanation: Returning premium to a client as an inducement for purchasing a policy, giving something of value to an insured in exchange for their business, and offering special dividends are considered rebatign EXCEPT Sharing commission with an agent licensed in the same line of business
Who does an agent represent during the solicitation of insurance?
The insurance company Explanation: When soliciting insurance to a client, an agent represents their insurance company
In order for a domestic, foreign or alien insurance company to conduct business, it must be authorized by whom?
The state whre they are conducting business Explanation: domestic, foreign or alien insurance companies must be authorized by each state where they conduct business
J is an agent who has induced an insured through misrepresentation to surrender an existing insurance policy. What is J guilty of?
Twisting Explanation: Twisting is the unfair trade practice of replacing an insurance policy from one insurer to another based on misrepresentation
An agent that sells _______ Life insurance MUST be registered with the Financial Industry Regulatory Authority (FINRA)
Variable Explanation: An agent is required to register with FINRA in order to sell Variable life insurance policies
Which of the following activities will NOT result in the suspension of an agent's license?
Working for a foreign insurer Explanation: Working for a foreign insurance company does not result in the revocation or suspension of an agent's license but making malicious and false statements about an insurer, replacing an insurance policy from one insurer to another based on misrepresentation and misrepresenting any fact about an insurance policy will result in suspension
According to Florida's rules on disclosure, a life insurance applicant is expected to be provided with
a Buyer's Guide and Policy Summary Explanation: Florida's rules on disclosure require an insurance company to provide a purchaser of life insurance with a Buyer's Guide and Policy Summary
In Florida, deceptive advertising is considered to be
a form of misrepresentation Explanation: According to Florida law, deceptive advertising is considered a form of misrepresentation
All of the following will result in the suspension of an agent's license EXCEPT
acting with fudiciary responsibilty Explanation: Intentionally misrepresenting the provisions of a policy, foraging a name on insurance application and being convicted of a felony will result in the suspension of an agent's license EXCEPT acting with fudiciary responsibilty
A variable life insurance agent must be licensed and appointed as a life and variable contract agent, as well as a(n)
broker dealer Explanation: An agent marketing variable life insurance must be licensed and appointed as a life and variable contract agent and a broker dealer
K is insured under a Group Life Insurance policy. K is considered to be a(n)
certificate holder Explanation: Each person covered a Group Life insurance policy is considered to be a certificate holder
An applicant who pays the initial premium at the time of application is typically given a(n)
conditional receipt Explanation: A conditional receipt is normally given to an applicant who pays the initial premium at the time of application
Florida's 14-day free-look period for life insurance policies begins at the
date of delivery Explanation: In Florida, the free-look period for life insurance contracts is 14 days from policy delivery
In Florida, an insurer licensed to conduct business in Florida, but domiciled in New Jersey, is called a(n)
foreign company
T is an agent and when hired, is reminded that he has a responsibility to handle clients' funds in an honest and ethical manner. This responsibility is referred to as
fudiciary reponsibility Explanation: fudiciary reponsibility involves an agent handling funds of a client or insurance company honestly and fairly, and not using them for the agent's own purposes
The Insurance Guaranty Fund Association
funded by admitted insurance companies through assessments Explanation: The Insurance Guaranty Fund Association is funded by admitted insurance companies through assessments and will pay claims if an insurance company becomes insolvent
Convincing a prospective insured to buy an insurance policy based on exaggerations is called
misrepresentation Explanation: It is illegal to issue, publish, or circulate illustration or sales material that is false, misleading, or deceptive as to policy benefits or terms, the payment of dividends, etc. This also refers to oral statements. Commiting this illegal act is called misrepresentation
In Florida, agents are allowed to engage in rebating if
offered to all insureds in the same actuarial class Explanation: Rebating is allowed in Florida if the agent rebates insureds in the same actuarial class
According to Florida's life insurance replacement laws, a policyowner must be provided with a written Comparison and Summary Statement when it's requested by
the policyowner Explanation: The replacement of existing life insurance policies with new contracts of life insurance requires a written Comparison and Summary Statement at the policyowner request
T is an employee covered under a Group Life policy. If T's employment is terminated, the conversion privilege gives T the right to convert
to an individual policy upon employment termination Explanation: When an employee covered on Group life policy leaves the group, the conversion priviledge gives the employee the right to convert to an individual policy upon termination of employment
An agent's license can be suspended or revoked by
writing primarily controlled business Explanation: An agent's license can be suspended or revoked by writing primarily controlled business
Which of the following is NOT required on every insurance application sold in Florida?
Address and phone number of the agent Insurer's name, agent's name and agent's license number must be shown on every insurance application sold in Florida EXCEPT Address and phone number of the agent
What type of insurance company is domiciled in England, but conducts business in Florida?
Alien Explanation: An insurance company that is domiciled in any country other than the US is known as an alien insurance company
J owns a business and has a Group Life policy covering her employees. J decides to cancel the policy by letting it lapse on the renewal date. What action must be taken?
All of the employees must be notified of the cancellation either by the insruance company or through J Explanation: An insurer must notifiy each certificate holder (employee) when the master policy has expired or is being cancelled. The insurer may take such action through the policyholder (employer)
Which of the following is an example of an Unfair Trade Practice?
Coercion Explanation: Coercion is considered an unfair trade practice in this state
A stock life insurance company that issues both participating and nonparticipating policies is doing business on
a mixed plan Explanation: When a stock life insurance company issues both participating and nonparticipating policies, the company is doing business on a mixed plan
An example of an unfair trade practice is
an agent making a material misrepresentation to the insured Explanation: Making an material misrepresentation to an insured is considered to be an unfair trade practice
An example of sliding would be
charging for an additional product without the applicant's consent Explanation: Sliding involves selling additional coverage to an insurance applicant who doesn't want or need it. An agent will often "slide" this additional coverage in without the customer's knowledge or consent
One defintion of replacement is "the act of replacing an existing insurance policy with another" Replacement is
closely regulated and requires full disclosure Explanation: Replacement of insurance policies is strictly regulated and requires full disclosure
An insurance company incorporated under the laws of the state in which its home office is located called a(n)_______ company
domestic Explanation: A domestic insurance company is domiciled and incorporated under the laws of the state in which its home office is located
In Florida, an insurer domiciled and incorporated in this state is called a(n)
domestic company Explanation: An insurance company domiciled and incorporated under the laws of Florida is a domestic company in Florida
A life insurance policy's grace period entitles the insured a period of no less than _____ days to make the premium payment?
30 Explanation: The grace period for a life insurance policy is never less that 30 days
A group plan was recently terminated. In Florida, how many days are covered individuals guaranteed coverage after a group plan's termination?
31 days Explanation: If a group plan is terminated, covered persons are guaranteed coverage is 31 days after termination
How many days does an insurance company have an reject a reinstatement application before it is automatically reinstated?
45 Explanation: If the insurer takes no action within 45 days, the policy will be reinstated automatically
A licensed agent must be appointed by an insurance company to solicit insurance in Florida. The agent's license will terminate if a certain period of time elapses without being appointed. How long is this period of time?
48 months Explanation: an agent's license will terminate f teh agent allows 48 months to elapse without being appointed for the calss or clased of insurance listed on the license
In Florida, what is the maximum percentage of controlled business an agent may produce?
50% Explanation: In Florida, an agent's controlled business may NOT exceed a max of 50%
According to Florida Law, an additional lapse notice must be issued after the standard grace period expired for policyowners age
64 years or older Explanation: In Florida, insurers are required to issue an additional lapse notice after the applicable statutory grace period has expired for policyholders 64 years of age or older
How many hours of continuing education must a newly licensed agent complete every two years?
24 Explanation: A newly licensed agent must complete 24 hours of education every 2 years
Within how many days a licensee notify the Department of Financial Services of a change in address?
30 Explanation: All licensee are required to notify the Dept of Financial Servies of a change in address within 30 days
J is an agent who recently told a claimant that his rights might be impaired if he does not complete a release form within a specified time. What could this agent be found guilty of?
Coercion Explanation: In this situation, the agent may be guilty of coercion
Which of the following areas of state regulation is NOT protected by the savings clause in ERISA?
Commerce Explanation: Insurance, Banking and Securities are areas of state regulation are protected by the saving clause in ERISA EXCEPT Commerce
All of the following are eligibilty requirements for an association group EXCEPT
Contributory plans require a minimum of 25 participants Explanation: A minimum of 100 participants is required for a contributory plan. Group must have been in existence for two years, Group must hold regular meetings at least on an annual basis, and must have been organized for some reason other than to obtain group insurance are eligibility requirements for an asociation group
Which action could result in a hearing being ordered by the Department of Financial Services
Performing insurance transaction without a license Explanation: A hearing may be conducted if anyone is suspected of engaging in the business of insurance without a license
A mutual insurance company and a stock insurance company have one main difference between them. What is this major contrast?
Stock company is owned by its shareholders. Mutual company is owned by its policyholders Explanation: A Stock company is owned by its shareholders and Mutual company is owned by its policyholders
Which of the following factors is NOT considered when the Department of Financial Services determines if an agent's home is an insurance agency?
The amount of premium collected at this location Explanation: The Dept of Financial Services does not take into consideration the amount of premium collected at an agent's home when determining whether or not the home is an insurance agency, however, listing the address on the agent's business cards, business solicitation is done at this location and clients are met at this location ARE factors considered when the Department of Financial Services determines if an agent's home is an insurance agency
The Financial Services Commission may hold hearing
for any reason deemed necessary Explanation: The Financial Services Commission may hold hearing for any purpose within the scope of the insurance code deemed necessary
An exmaple of rebating would be
offering a client something of value not stated in the contrat in exchange for their business Explanation: Rebating can be defined as offering a prospect something of value that is not specified in a contract in order to induce the purchase of that contract
An example of unfair discrimination would be
offering different terms of coverage for different policyowners having the same risk classification Explanation: Providing different terms of coverage for different policyowners in the same risk classification would be an example of unfair discrimmination
Under Florida law, a variable annuity policyowner must be notified of the accumulated value of the contract
once each year Explanation: A variable annuity policyholder must be informed at least once each year of the accumulated value of the contract during the premium payment period
An example of an unfair claim settlement practice is
turning down a claim without providing the basis of denial Explanation: Denying an insured;s claim without indicating the basis of denial under the policy is considered an unfair claim settlement practice
An agent who makes misleading statements that lead to the termination of an existing insurance policy so that a new policy with another insurer can be taken out has committed
twisting Explanation: Twisting is knowingly makiing misleading statements that would cause an insured to lapse, assign, or terminate an insurance policy in order to switch companies
A life insurance policyowner may sell their policy to a(n)__________ ino order to receive a percentage of the policy's face value
viatical settlement provider Explanation: To receive a percentage of the policy face value, an owner of a life policy may sell the policy to a viatical settlement provider
Which of the following actis is an agent NOT authorized to do on behalf of an insurer?
Authorize claim payments Explanation: Agents do not authorize payment of claims but they do accept premiums from policyowners, complete insurance applications and ask health related questions
Which organization was established to provide funds to protect an insured in the event of an insurer's insolvency?
Florida Insurance Guaranty Fund Association Explanation: The Florida Guaranty Fund Association exists to protect an insured in the event of an insurer's insolvency
In Florida, when agents recommend changes be made for existing coverage, the agent must follow established procedures. The name of this rule is called the
Florida Replacement Rule Explanation: The Florida Replacement Rule sets forth the requirements and procedures to be followed by insurance companies and producers when replacing existing life insurance contracts
Which Unfair Trade Practice involves an agent telling a prospective client that a policy's dividends are guaranteed?
Misrepresentation Explanation: An agent who tells a client that dividends are guaranteed may be guilty of misrepresentation
Which Unfair Trade Practice involves an agent suggesting that an insurance policy is like a share stock?
Misrepresentation Explanation: If an agent tells an applicant that an insurance policy is like a share of stock, the agent may be guilty of misrepresentation
An individual covered under a Group Life insurance policy is considered to be a(n)
certificate holder Explanation: Each person insured under Group Life Insurance policy is certificate holder
Which of the following is considered to be misrepresentation?
An agent guaranteeing a policy's dividends Explanation: Stating that dividends are guaranteed is considered a misrepresentation
Which of the following situation does NOT apply to the Florida Replacement Rule?
An exisiting policyholder purchses an additional policy from the same insurer Explanation: Florids's Replacement Rule applies to an exisiting policy is reissued with a reduction in cash value, a new policy is issued while an existing one is surrendered and an existing policyholder purchases an additional policy from the same insurer applies to these situation EXCEPT An exisiting policyholder purchses an additional policy from the same insurer
All of the following are Nonforfeiture Options EXCEPT
Automatic Premium Loan Option Explanation: An automatic premium loan option is not considered a Nonforfeiture Option but cash surrender option, extended term option and redueced paid up option are considered
The insurer must provide a prospective buyer with a(n)
Buyer's Guide and Policy Summary Explanation: The insurer must provide a prospective buyer with a Buyer's Guide and Policy Summary
__________ can be defined as "using the contract values of an existing policy to purchase a new policy with an existing insurer"
Churning Explanation: Churning can be defined as "using the contract values of an existing policy to purchase a new policy with an existing insurer"
In Florida, which of the following is considered an Unfair Trade Practice?
Coercion Explanation: Coercion is considered an unfair trade practice under Florida Law
Which of the following unfair trade practices involves an agent who makes malicious statements about another person's financial condition?
Defamation Explanation: an agent who makes statement that is maliciously critical of another person's financial condition is guilty of defamation
In Florida, which agency is responsible for the rehabilitation or liquidation of insurers?
Department of Financial Services (DFS) Explanation: DFS is responsible for the rehab or liquidation of insurers when necessary
Which two entities regulate variable annuities?
Department of Financial Services; and Securities Exchange Commission Explanation: Variable annuties are regulated by both Department of Financial Services; and Securities Exchange Commission
Which of the following is a standard provision of rhe conversion priviledge in a Group Life Policy
Group life coverage can be converted to an individual poliy at regular rates on attained age basis Explanation: Conversion at regular rates on an attained age basis without a medical exam is a standard provision for conversion privledge in Group life policies
What would be an accurate definition of "controlled business"?
Insurance business tha tis written on the agent's own life, property, or interests Explanation: Controlled business is insurance business that is written on the agent's own life, property or interests
If an agent would like to sell Variable annuites, which state examination must the agent pass?
Life and Variable contracts Explanation: An agent who wants to selll Variabe annuities must be licensed by the state which includes examination in Life and Variable contracts`
What is main reason for regulating the insurance industry?
Maintain the solvency of insurance companies Explanation: The primary purpose of regulation of the insurance industry is to promote the public welfare by maintaining the solvency of insurance companies
According to Florida Law, which of the following information does NOT need to be obtained by an agent recommending an annuity purchase?
Marital status Explanation: Florida law requires an agent who is recommending the purchase of an annuity to a person to obtain information regarding annual income, age and financial objectives EXCEPT Marital status
Which Unfair Trade Practice involves making a false statement on an insurance application in order to receive money from an insurer?
Misrepresentation Explanation: Making a fradualent statement on an insurance application would be considered an act of misrepresentation
Which of the following is NOT an unfair claim settlement practice?
Needing written documentation of claim details Explanation: Failing to acknowledge and act promptly with respect to an insurance claim, compelling an insured to initate a lawsuit by offering less on an insurance claim and failing to accept or deny a claim within reasonable time after proof of loss is submitted are unfair claim settlements EXCEPT Needing written documentation of claim details
Under which circumstance may a licensed agent in Florida represent at unauthorized entity?
Never Explanation: A licensed agent in Florida may never represent an unauthorized entity
According to Florida law, a Group Life insurance policy requires a minimum of how many insureds?
No minimum Explanation: In Florida, there is no min number of insureds required for a group life insurance policy
Which of the following documents must an agent submit to the replacing insurance company during the replacement of an existing life insurance policy?
Notice to existing and replacing insurer of intention to replace Explanation: When replacing an existing life insurance policy, an agent must submit notice to exisiting insurer and replacing insurer intentions
A life insurance policyowner would like to file a compliant against a life insurance agent. In Florida, the entity that oversees these complaints is called the
Office of Financial Regulation Explanation: It oversees complaint against life insurance agents and agencies selling life insurance products
Which department oversees 'Market Conduct Examinations' in Florida?
Office of Insurance Regulation Explanation: OIR oversees 'Market Conduct Examinations' and Investigations
Which entity approves the insurance policy forms used in Florida?
Office of Insurance Regulation (OIR) Explanation: The insurance policy forms used in Florida are approved by the OIR
How can an agent-in-charge have more than on location?
Only if the agent-in-charge is present when insurane activity occurs Explanation: Muiltple locations are allowed as long as the agent-in-charge is present when insurance activity occurs
K is an agent who made an improper sale of an annuity to a client. Which of the following corrective actions would the Department of Financial Services likely order K to take?
Pay monetary resitution to the client Explanation: The Dept of Financial Servies may order the agent to pay monetary restituition to the client
Which of the following types of insureds are life insurance companies allowed to make policy rate discrimminations against?
People that smoke Explanation: A life insurance company may make policy rate discrimminations against people that smoke
W gave W's age as 50 when W purchased a Life policy. At the time of W's death seven years later, the company discovered W's true age at issue had been 59. What would the normal procedure be under the misstatement of age provision in regard to the payment of the death claim?
The proceeds woulf be reduced based on whatever the premium would have been if purchased at age 59 Explanation: In this situation, the proceeds will be reduced based on whatever the premium would have been if purchased at age 59
Which of the following is considered an accurate statement of an unfair practice?
Twisting involves an agent using misrepresentation to convince a policyowner to cancel their current policy so that the can purchase a new life insurance policy with another company Explanation: Twisting is a misrepresentation made by an agent in order to induce a policyholder to laspse a policy and switch insurance companies. It's considered an unfair trade practice
The policy summary contains specific information on all of the following EXCEPT
commission Explanation: The policy summary contains specific information on the provisions, benefits, and coverge of the policy applied for. It does not contain information on agent commission
The Department may request all of these during the licensing application process EXCEPT
drug test Explanation: The Dept will not request a drug test during the licensing application process but will request fees, proof of citzenship and fingerprints
An example of an unfair claims practice would be
failing to effectuate prompt, fair, and equitable settlements of a claim Explanation: Failing to effectuate prompt fair, and equitable settlements of claims is considered to be an unfair claims practice
The act od an insurance company publishing misleading information about its policy's provisions is called
false advertising Explanation: An insurance company that publishes misleading information about insurance coverage may found guilty of false advertising
A foreign insurance company doing business in Florida
is a company that was formed under the laws of another state Explanation: In Florida, a foreign insurance company is a company that is formed under the laws of a state oter than Florida
A license may be denied, suspended, or revoked if the licensee
is found guilty of misrepresentation Explanation: Being found guilty of misrepresentation may result in the Dept of Financial Services denying, suspending, revoking, or not renewing any license
A stock insurance company
is owned exclusively by its shareholders Explanation: A stock insurance company is best defined as an incorporated company that has its capital divided into shares and is owned exclusivey by its shareholders
In Florida, an element of an insurance transaction would be
issuing an insurance contract Explanation: The issuance of an insurance contract is considered to be an element of an insurance transaction
Who is a mutual insurance company owned by?
its policyholders Explanation: A mutual insurance company is owned by its policyholder
Who owns a stock company
its stockholders Explanation: A stock insurance company is owned by its stockholders
Defamation occurs when an agent makes a false statement intended to
malign another insurer Explanation: Defamation is an unfair trade practice involving false, maliciously critical, or derogatory statements intended to inure a person or company engaged in the insurance business
During the course of an insurance transaction, if an agent makes a false or incomplete statement, he/she could be found guilty of
misrepresentation Explanation: An agent who intentionally make an untrue or incomplete statement during the courses of an insurance transaction may be guilty of misrepresentation
Unde ra life insurance policy, the______ had the authority to name the beneficiary
owner Explanation: The policyowner has the authority to name the beneficiary of a life insurance policy
If a policyowner does not pay the premium by the due date, the
policyowner can make the premium payment during the grace period Explanation: If a policyowner does not pay the premium by the due date, the premium may be paid during the grace period
According to Florida law, group life insurance conversion priviledges must NOT
require evidence of insurability Explanation: Florida's Insurance law that governs group life insurance conversion privileges provides that the individual policies do not require evidence of insurability
During the application process, the agent's primary responsibility is to
the insurance company Explanation: The agent's primary responsibility in the application process is to the insurer
When replacing or exchanging an annuity, the agent must disclose to the annuitant
the possible tax ramifications as a resule of the transaction Explanation: An agent must disclose the possible tax consequences of replacing or exchanging an esisting annuity or life insurance policy
Group Life polices in Florida are required to contain a conversion priviledge that allows for conversion
to an individual policy for a stated period of time Explanation: In Florida, Group life policies must contain conversion priviledge that allows for conversion to an individual policy for a specified period of time
