Final Exam

Which of the following is NOT a life insurance policy nonforfeiture option in Florida?

Florida life insurance policies must contain the following nonforfeiture options: reduced paid-up life insurance, cash surrender value, and extended term life insurance. The correct answer is: Secondary universal life benefit

If someone covered by a group health plan loses their employment, how many days do they have to convert to an individual policy?

Group health plans must contain a conversion privilege for individual insureds, which allows them to convert their group certificate to an individual medical expense policy with the same insurer within the conversion period of 31 days. The correct answer is: 31 days

Which of the following is not an eligible group for group life insurance?

Group life contracts may be issued to employee groups, debtor groups, labor union groups, trustee groups, association groups, credit union groups, dependent groups and other groups approved by the department. The correct answer is: None of the above

In Florida, group life insurance contracts must cover at least:

Group life insurance contracts must cover at least 1 individual. The correct answer is: 1 person

What is the maximum percentage of employees that an employer is allowed to require to participate in a noncontributory group health insurance plan?

However, a noncontributory plan, allows the employer to require 100% of all eligible employees. The correct answer is: 100%

Which of following is not true of the return of premium rider?

If the insured dies during the term period, the beneficiaries receive a lump sum payment of the death benefit of the policy. The correct answer is: If the insured dies at any time during the term period, he / she forfeits the benefits of the policy.

If an insurer accepts the coverage as applied for, when does coverage begin?

If the insurer accepts the coverage as applied for, the coverage would take effect the date of the application or the medical exam whichever is later. The correct answer is: The date of the application or medical exam

All of the following are typical health policy exclusions, EXCEPT:

Injuries that are caused by acts of war, are self-inflicted or the result of a preexisting condition are typically excluded from coverage - as are injuries resulting from piloting a private plane. The correct answer is: Injuries that are the result of foolishness

Individuals may purchase long-term care benefits from all of the following sources, EXCEPT:

Medicare does not provide benefits for long-term care on any basis. Benefits for long-term care must be purchased separately. The correct answer is: Medicare Part B

All of the following plans may provide home health care, assisted living and custodial benefits, EXCEPT:

Medicare does not provide benefits for long-term care. To have these benefits available, an individual must have some form of independent long-term care coverage. The correct answer is: Medicare Part A and B

In addition to moral hazards, an underwriter will be very concerned about what physical conditions?

Obesity or overweight is a primary concern in health insurance underwriting. The correct answer is: Obesity

Which of the following is not true about nonoccupational and occupational policies?

Occupational benefits provided can be reduced by benefits paid under Social Security and/or Workers' Compensation. The correct answer is: Social Security benefits do not impact benefit payments on either of these policies.

The manner in which the proceeds of a life policy are handled are specified in what provision?

Payment of claims is specified in the settlement options. The correct answer is: Settlement options

Which of the following statements is not true about the tax liabilities for individual life insurance policies?

Policy loans are not taxable as income because they are regarded as a debt against the policy. The correct answer is: Policy loans are taxable as income.

A policyowner can change a beneficiary unless the beneficiary is:

Policyowner's have the right at all times to change the beneficiary or beneficiaries unless the policyowner waives this right in writing by stating that the beneficiary is irrevocable. The correct answer is: Irrevocable

Who is the only one who can change the beneficiary on a life policy?

Policyowner's have the right at all times to change the beneficiary or beneficiaries unless the policyowner waives this right in writing by stating that the beneficiary is irrevocable. The correct answer is: Policyowner

Who can change the beneficiary on a life policy?

Policyowner's have the right at all times to change the beneficiary or beneficiaries unless the policyowner waives this right in writing by stating that the beneficiary is irrevocable. The correct answer is: Policyowner only

If an agent states that certain coverage is required by law when it isn't, this would be:

Sliding includes representing to an applicant that a specific ancillary coverage or product is required by law in conjunction with the purchase of insurance when such coverage or product is not required. The correct answer is: Sliding

Which of the following is described as charging insureds additional fees without their consent?

Sliding occurs when agents or insurers charge applicants additional charges without applicants' consent. The correct answer is: Sliding

What type of rating method are small employer health policy carriers in Florida required to use for establishing premium rates?

Small employer health policy carriers in Florida must use a _modified community rating_ method for establishing premium rates. The correct answer is: Modified community rating

What part of the policy directs the insurer on the recipients of benefits?

The Payment of Claims provision stipulates to whom claim payments are made. The correct answer is: Payment of Claims provision

Which rider on Diane's life policy will help her out when she is confined to a nursing home with a terminal illness?

The accelerated benefit allows Diane to receive a portion of the death benefit of her policy, prior to her death. The insured must have been diagnosed as terminally ill in order for this benefit to be paid. The correct answer is: Accelerated benefit rider

Which of the following is not one of the daily living activities that can trigger long-term care benefits?

The activities of daily living used to determine benefits are: bathing, continence, dressing, eating, toileting, and transferring. Reading is not considered a required daily activity. The correct answer is: Reading

All of the following are good reasons to deliver a life insurance policy in person, EXCEPT:

The agent does not have the power or authority to change the effective date of the policy. The correct answer is: The agent can change the date of the coverage, if necessary.

When completing an application for insurance, an agent is allowed to do which of the following:

The agent must be present to witness signatures. The other actions are either prohibited or functions for others in the underwriting process. The correct answer is: Witness the applicant's signature

If an agent told a client an HMO was a form of insurance and implied that the policy being offered included shares of stock, those actions would be characterized as:

The agent was engaged in misrepresentation by presenting the policy as something it was not. Statements are considered to be misrepresentations if, when taken in the context of the whole presentation, may tend to deceive a person. The correct answer is: Misrepresentation

An answer an applicant provides on an application is considered a:

The answers an applicant provides on his application are considered representations. A representation is a statement that this is the truth as far as the applicant knows. The correct answer is: Representation

A health insurance underwriter may deny coverage for which of the following reasons?

The applicant may be denied coverage on the basis of personal habits. The correct answer is: The applicant's history of alcohol abuse

Which of the following must happen before an HIV test is performed on an applicant?

The applicant must consent to the test and sign a consent form before the test is performed. The correct answer is: A consent form must be signed by the applicant prior to the test.

A decreasing term life policy would be the most appropriate for:

A decreasing term life policy would be the most appropriate for a 41 year old lawyer who wants a policy to pay his mortgage if he dies. The correct answer is: A 41 year old lawyer who wants a policy to pay his mortgage if he dies

Why would someone be assessed a tax of 20% when transferring funds from one IRA to a new IRA?

A rollover requires that funds be deposited in the new IRA within 60 days of distribution from the old IRA - or a 20% tax penalty is assessed. The correct answer is: It was more than 60 days to complete the transfer.

To prevent major illness devastation, a self-employed person might consider:

A self-employed person will be well served with a health savings account and a high deductible health plan. The correct answer is: A high deductible health plan in conjunction with a health savings account

Which policy would best suit someone who retires with a large amount of cash?

A single premium whole life insurance would suit the insured's needs. The correct answer is: Single premium whole life insurance

Giving a client's child a stuffed animal with a company's logo that is valued at less than $25 would be considered:

A small gift under $25.00 that is used as advertising is not rebating. For example giving a client's child a stuffed animal with your company's logo. The correct answer is: Advertising

In what type of HMO are all the doctors employed directly by the HMO and housed in the same building?

A staff model HMO employs all physicians, and they usually work from a central location. The correct answer is: A staff model HMO

Which of the following is not an option for handling the designation of minor beneficiaries on a life policy?

A tertiary beneficiary is one that receives the proceeds of a policy if the primary and secondary beneficiaries die. A tertiary beneficiary is not set up to administer policy proceeds for minor children. The correct answer is: Set up a tertiary beneficiary to receive the proceeds

Which of the following is not an assignment whereby someone would transfer legal rights as the policyowner of a life contract?

A total, complete, unconditional assignment does not exist in the insurance world. The correct answer is: Total, complete, unconditional assignment

Most group contracts contain which of the following major provisions?

A typical group plan has provisions, selected by the employer, that specify coverage amounts, effective date of coverage, beneficiaries, settlement options, conversion privilege and 31 day continuation of coverage options. The correct answer is: All of the above

A contract term that means only one party to the contract's promises are legally enforceable?

A unilateral contract is one where only one party to the contract's promises are legally enforceable? The correct answer is: Unilateral

A unilateral contract is:

A unilateral contract makes promises for a performance. The correct answer is: A contract that makes a promise or promises in exchange for a performance

Which of the following is not an example of a plausible third party ownership situation?

A woman owning a policy on an ex-boyfriend would not be allowed, and consequently not be an example of a third party ownership situation. The correct answer is: A woman that owns a policy on an ex-boyfriend

What is the biggest source of information used in underwriting?

The application is the biggest source of information used in underwriting. The correct answer is: Application

What is the maximum liability of the Florida Life and Health Guaranty Association for death benefits or health insurance claims?

The association's liability for the contractual obligations of the insolvent insurer will be no more than the contractual obligations of the insurer in the absence of such insolvency. Listed below are the maximum amounts the association will pay for covered insolvent policies: Life insurance death benefit: $300,000 per insured life, Life insurance cash surrender: $100,000 per insured life, Health insurance claims: $300,000 per insured life, Annuity cash surrender: $100,000 per contract owner, Annuity benefits: $300,000 per contract owner The correct answer is: $300,000

Which of the following could be used to prevent a lapse in the payment of life insurance premiums?

The automatic premium loan allows the insurer to tap into the cash value of a policy to pay an overdue premium. The correct answer is: Automatic premium loan

Sue's hospital bill is $4,500. Her major medical policy has a $500 deductible and then it pays 80% of the remaining bill. The policy also has a maximum out-of-pocket of $2,000. How much of the total bill will the insurance company pay?

The bill is $4,500. Subtract $500 for the deductible. The company will pay 80% of the balance, which is .80 x $4,000 = $3,200. The correct answer is: $3,200

With an accidental death and dismemberment policy, the payment of a specified amount, usually a percentage of the principal sum, which varies according to the severity of the injury, is called:

The capital sum pays a specified amount, varying with the severity of the injury. The correct answer is: Capital sum

Alex's life policy lapsed, which Nonforfeiture option would the insurer send him the value of the policy?

The cash surrender option allows the policyowner to receive the policy's cash value. The correct answer is: Cash surrender

The cash surrender value of a life insurance policy is not subject to garnishment or legal process in favor of a creditor:

The cash surrender value of a life insurance policy is not subject to garnishment or legal process in favor of a creditor. The correct answer is: Nothing

The children's rider is not:

The children's rider covers only the children. It is a form of term insurance and is part of the life policy of the insured. It is not a family rider. The correct answer is: A family rider

What is the minimum grace period for group life insurance policies in Florida?

The grace period for group life insurance policies in Florida is at least 31 days. The correct answer is: 31 days

The grace period for individual life insurance policies in Florida must be at least:

The grace period for individual life insurance policies in Florida is at least 30 days. The correct answer is: 30 days

What is the minimum grace period for individual life insurance policies in Florida?

The grace period for individual life insurance policies in Florida is at least 30 days. The correct answer is: 30 days

The rider that you would pick if you want to be able to add coverage in the future, without having to show proof of insurability:

The guaranteed insurability rider allows the insured to add coverage in the future, without having to show proof of insurability. However, the insurer can charge a higher premium due to a higher attained age. The correct answer is: Guaranteed insurability

With a Guaranteed Insurability rider on a Disability Income policy, the:

The guaranteed insurability rider allows the insured to purchase additional disability income coverage at future dates regardless of insurability. The correct answer is: The insured can increase the benefit payable amounts periodically.

What rider allows someone to purchase additional disability income insurance at a later date, regardless of insurability?

The guaranteed insurability rider allows the insured to purchase additional disability income coverage at future dates regardless of insurability. The correct answer is: A guaranteed insurability rider

What is also referred to as the future increase option and can be attached to disability income policies because the benefit amount is fixed, so costs remain level?

The guaranteed insurability rider can be attached to disability income policies and costs remain level. The correct answer is: Guaranteed insurability

Which of the following is not a rider that increases the policy's base premium?

The impairment rider excludes coverage; therefore, the premium would not increase. The correct answer is: Impairment rider

In the claims payment provisions in a health policy, the standard time for a company to deliver a claim form once it has been notified of a loss is:

The insurance company has 15 days to provide a claim form under the uniform claims provision clause. The correct answer is: 15 days

What action will an insurance company take in issuing an individual health insurance policy to someone who has had asthma since childhood?

The insurance company is likely to issue the coverage with an impairment rider, which simply excludes coverage for certain losses relating to asthma. The correct answer is: Issue the policy with an impairment rider

The fact that the application is part of the policy is stated in:

The insurance policy itself (including any riders and endorsements/amendments) and the application, if attached to the policy, comprise the entire contract between all parties. The correct answer is: The entire contract

Which of the following is required for the conversion/exchange to take place in a convertible term policy?

The only requirement for a convertible term policy to be exchanged or converted to a permanent policy is that the premiums on the term policy have been paid in a timely manner. The correct answer is: It requires that premiums be paid on time.

How are a revocable and irrevocable beneficiary designations similar?

The only way that the revocable and irrevocable beneficiaries are similar in these statements is that the policyowner pays the premiums. The correct answer is: The policy owner pays the premiums.

What approach calculates the amount of money a family needs immediately upon the death of the insured to pay for their expenses and basic necessities?

The needs approach calculates the amount of money a family needs immediately upon the death of the insured to pay for their expenses and basic necessities. The correct answer is: Needs

What guarantee states that if the policyholder discontinues payment of premiums, the policyholder can have access to the cash value of the policy?

The nonforfeiture provision protects a policyowner from losing their investment. If a policy is cancelled, surrendered or premiums are not paid, the nonforfeiture provision provides the policyholder access to the cash value of the policy. The correct answer is: Nonforfeiture provision

Controlled business is usually written on all the following, EXCEPT:

Controlled business is using an insurance license principally to procure insurance for the licensee, relatives, personal business, or employees. The correct answer is: Friends

Making a false statement about a competing insurer is considered:

Defamation is making any oral or written statement that is false, misrepresents, or is maliciously critical of the financial condition of an insurer, and which is calculated to injure any person engaged in the business of insurance. The correct answer is: Defamation

An annuity contract provides for all of the following, EXCEPT:

Depending on the type of annuity, it usually provides a safe retirement income tool, acts as a forced savings account, and has payments for a lifetime of a fixed period of time. The correct answer is: A health plan

A Medicare Supplement Plan will provide which of the following benefits?

Depending on which Medicare Supplement plan a senior selects, the amount paid out may or may not cover all of the expenses not paid by Medicare. The correct answer is: Pay some part of the medical expenses not covered by Medicare in full

Direct response life insurance advertisements may contain which of the following phrases?

Direct response life insurance advertisements may not contain the phrases: "no salesman will call", "no agent will call", or "by eliminating the agent and/or commission, we can offer this low cost plan," or similar wording. The correct answer is: "Save money"

How does the IRS treat disability income benefits when the employer pays the policy premiums?

Disability income benefits from an employer-paid group policy are fully taxable. The correct answer is: They are fully taxable.

What is a medical provider who has negotiated with healthcare professionals to accept a discounted fee at the time the service is performed?

Discount Medical Plan Organizations (DMPOs) are medical providers who have negotiated with healthcare professionals to accept a discounted fee at the time the service is performed. The correct answer is: DMPO

Which of the following would NOT be considered unfair discrimination?

Discrimination is a necessary part of insurance, including occupation, hobbies, and expectation of life. It is an unfair trade practice to discriminate against individuals of the same class and equal expectation of life in the rates, terms, conditions, benefits, or any policy provision for insurance. It is illegal to discriminate based on sex, race, national origin, or blindness. The correct answer is: Discrimination based on hobbies

All of the following are true statements about life insurance policy dividends, EXCEPT:

Dividends are not taxable, are usually paid once a year, and are really a return of overcharged premiums. The correct answer is: Dividends are taxable

How frequently must domestic insurers be examined by the Office of Insurance Regulation?

Domestic insurers must be examined by the Office of Insurance Regulation at least once every 5 years. The correct answer is: At least once every 5 years

Domestic insurers must be examined by the Office of Insurance Regulation a minimum of:

Domestic insurers must be examined by the Office of Insurance Regulation at least once every 5 years. The correct answer is: Once every 5 years

Tina has a policy that only covers cancer-related medical expenses. What kind of policy does she have?

Dread disease policies are limited policies that pay for a specific disease or medical condition. The correct answer is: Dread disease

What are the two most common adjustments made during a month with a universal life insurance policy?

Each month, the cost of the death protection is deducted from the cash value, and the current interest rate is credited. The correct answer is: Cost of death protection deducted and current interest rate credited

Eligibility for the payment of long-term care benefits may not be more restrictive than requiring a deficiency in the ability to perform not more than:

Eligibility for the payment of long-term care benefits may not be more restrictive than requiring a deficiency in the ability to perform not more than 3 activities of daily living (ADLs). The correct answer is: 3 activities of daily living

Employee group life insurance is for the benefit of:

Employee life insurance insures the lives of a group of individual employees of an employer for the benefit of persons other than the employer, under a group policy issued to the employer. The correct answer is: Employee only

Who is employee group life insurance designed to benefit?

Employee life insurance insures the lives of a group of individual employees of an employer for the benefit of persons other than the employer, under a group policy issued to the employer. The correct answer is: Employee only

The policy for employee group life insurance is paid by:

Employee life insurance insures the lives of a group of individual employees of an employer for the benefit of persons other than the employer, under a group policy issued to the employer. The policy premium is paid by the policyholder, either from the employer's funds, the insured employee's funds, or both. The correct answer is: Employee or employer, or both

Sam is eligible for both his company's health plan and Medicare. Which plan would be primary?

Employer sponsored health plans are always primary, and Medicare is secondary. The correct answer is: Work

What type of premiums payment can employers deduct as an ordinary business expense?

Employers can deduct premium payments for group insurance. The correct answer is: Group

Except for direct response policies, when must a Medicare supplement policy outline of coverage must be delivered to an applicant?

Except for direct response policies, a Medicare supplement policy outline of coverage must be delivered at the time of application. The correct answer is: At the time of application

Which of the following is considered a reimbursement contract?

Except for major medical, the benefit is known before a claim occurs. Major medical will pay based on the covered loss, which is not known until the loss occurs. The correct answer is: Major medical contract

Which of the following provisions will limit benefits in an insurance contract?

Exclusions define what is not covered; thus, limiting coverage. The correct answer is: Exclusions

Which of the following is NOT a life insurance policy nonforfeiture option in Florida?

Florida life insurance policies must contain the following nonforfeiture options: reduced paid-up life insurance, cash surrender value, and extended term life insurance. The correct answer is: Enhanced life benefit option

Which of the following is NOT a life insurance policy nonforfeiture option in Florida?

Florida life insurance policies must contain the following nonforfeiture options: reduced paid-up life insurance, cash surrender value, and extended term life insurance. The correct answer is: Included health extension benefit

The type policy that allows the insurer to cancel a policy on any specified date, and to increase a policy's premiums for any class is

The optionally renewable policy allows the insurance company to cancel the policy for any reason, on dates set in the contract. The insurer can also increase the premiums. The correct answer is: Optionally renewable

If an insurer has the right to refuse to renew a policy, the policy has which of the following provisions?

The optionally renewable provision allows an insurer to refuse to renew for no reason. The correct answer is: Optionally renewable

What is the latest that the outline of coverage can be delivered?

The outline of coverage describes the benefits and features of health insurance policies, and must be provided at the time of application, but no later than at the time of policy delivery. The correct answer is: When the policy is delivered

When Claire's father took out a policy on her life, he was the policyowner and Claire was the insured. This is an example of:

This is an example of third party ownership of a policy. When someone other than the insured is the owner of the policy. If Claire was a minor child, it could be dependent coverage. The correct answer is: Third party ownership

Susan was admitted to the hospital. She failed to pay her premium prior to admission, but is within the grace period. Under the unpaid premium provision the company is entitled to:

This provision allows the insurance company the opportunity to do the right thing without violating the terms of the contract. The correct answer is: Subtract the unpaid premium from the claim payment

Richard is thinking about transferring some of the ownership rights of his policy to his brother Randy. What term is used for this type of transfer?

This type of transfer is referred to as an assignment. The correct answer is: Assignment

In order to continue coverage for a newborn, when must the insurer be notified of the birth?

To continue coverage for a newborn, the insurer must be informed of the birth within 30 days of the birth. The correct answer is: Within 30 days

Which of the following is an improper form of policy replacement?

Twisting is an improper type of replacement along with churning. Twisting is replacing another companys policy, whereas churning is replacing a policy within the same company. The correct answer is: Twisting

Which of the following is not a common premium payment mode for life policies?

Daily is not a premium payment mode for life insurance. The correct answer is: Daily

Assets deposited into a fixed annuity are invested in:

Deposits from fixed annuities are placed in the company's general account. The correct answer is: The insurance company's general account

Mr. Blankman intentionally left a prior medical treatment off his insurance application because of embarrassment. He is not guilty of:

Failure to disclose a procedure is only fraud if there was intent to gain some value (i.e., collect on a false claim.) The correct answer is: Fraud

What are nonprofit entities that provide life insurance as a benefit for their members and beneficiaries?

Fraternal organizations are nonprofit entities that provide life insurance as a benefit for their members and beneficiaries. The correct answer is: Fraternal organizations

If death benefits are paid in installments, when must the amount and period be determined?

If death benefits are paid in installments, a table showing the amount and period of installments must be included in the life insurance policy. The correct answer is: After receipt of the proof of death

If death benefits are provided in a lump sum, the payment must include interest from:

If death benefits are provided in a lump sum, the payment must include interest from the date the insurer receives written proof of death of the insured. The correct answer is: The date the insurer receives written proof of death of the insured

What is the first action the Office of Financial Regulation will take for violation of any law relating to the operation of a financial institution?

If the Office of Financial Regulation finds that a state financial institution has violation of any law relating to the operation of a financial institution, it may issue a cease and desist order. The correct answer is: A cease and desist order

What is the first action the Office of Insurance Regulation will take for an insurer engaging in an unsound practice?

If the Office of Insurance Regulation finds that a state financial institution has engaged in unsound or unsafe practice, it may issue a cease and desist order. The correct answer is: A cease and desist order

All of the following are considerations on whether to include life insurance proceeds in determination of federal estate taxes, EXCEPT:

If the deceased WERE the policyowner, it would be a consideration for federal estate taxes. The correct answer is: The deceased was not the policyowner.

An insured, returning from a disability, is working part-time. If he qualifies for a partial disability provision, he will receive what percent of his pre-disability wage from disability benefits in addition to his part-time salary?

50% of pre-disability wage is usually the maximum for a partial disability. The correct answer is: 50%, but the total wage may not exceed his pre-disability wage

Jeff owns a small business. If he becomes disabled, which type policy would pay his operating expenses?

A Business overhead expense policy pays a company's operating expenses, such as rent or payroll, if an owner becomes disabled. The correct answer is: Business overhead expense

Preston has a policy that guarantees coverage, but the insurer can raise his premiums. Which type is it?

A Guaranteed renewable policy does not allow the insurer to cancel the policy, but it allows the insurer to increase the premiums. The correct answer is: Guaranteed renewable

The definition of "Medicare eligible expense" for a Medicare supplement policy cannot be:

A Medicare supplement policy cannot have a definition of "Medicare eligible expense" that is more restrictive than Medicare's. The correct answer is: More restrictive than Medicare's

If a small business owner becomes disabled, what expenses will not be reimbursed by the Business Overhead Expense Policy?

A business overhead expense policy will not reimburse personal expenses or the owner's salary. The correct answer is: Lease payments for his personal automobile

Which of the following types of policies combine multiple benefits and provides a broader range of coverage?

A comprehensive major medical plan will cover all medical events without the need for several policies. The correct answer is: Comprehensive Major Medical

Under an HMO contract, when does coverage for newborns begin?

A newborn child of an HMO subscriber is covered from the moment of birth. The correct answer is: The moment of birth

A prospective buyer should understand that a disability plan presented as 'non-cancellable' means:

A non-cancellable policy is guaranteed benefit, guaranteed renewable and guaranteed premium. The correct answer is: The plan may not be cancelled by the insurance company and the premiums are guaranteed never to increase.

The type of policy that does not allow the insurer to change the premium or the coverage is:

A noncancelable policy guarantees the premium rate, and it also guarantees that the policy won't be cancelled. The correct answer is: Noncancelable

Which of the following is true of a nonqualified plan?

A nonqualified plan can be a deferred compensation plan, does not need IRS approval, can compensate key people and can be used for executive bonuses. The correct answer is: Can be a deferred compensation plan

In a life policy, a statement of good health is needed when:

A statement of good health is needed when the application does not include the initial premium with the application. The correct answer is: The application does not include the premium.

Jeff has limited financial resources, but finds himself in a position where he needs a good deal of protection. A __________would probably best suit his needs at this time.

A term policy would give him the most protection for the least money up front. The correct answer is: Term policy

Jamie had group life insurance with his former employer, but his new company does not offer life insurance. What are his options?

All group policies are required to include a provision for conversion to individual coverage. The correct answer is: He can convert his insurance to an individual policy.

In Florida, what is the rule for coverage of fibrocystic condition?

All health insurance policies must cover fibrocystic condition without exclusions or exceptions. The correct answer is: All health insurance policies must cover fibrocystic condition

Which of the following would be a routine exclusion in a life policy?

All of the activities listed would routinely be excluded. That means the insurer would not pay a death benefit claim under these circumstances. The correct answer is: All of the above

Which of the following is a settlement option that a life insurance policyowner can choose?

All of the choices are settlement options available to policyowners. The correct answer is: All of the above

Which of the following is a duty of the insurer when the transaction involves a replacement of an existing policy?

All of the duties listed are insurer responsibilities in a replacement transaction. The correct answer is: All of the above

Typical health policies do not provide benefits for which of the following?

All of the items listed are typically excluded from health policies. The correct answer is: All of the above

All of the following are true concerning a single premium whole life plan, EXCEPT:

Any withdrawal from a life insurance policy is subject to tax rules in effect at the time of withdrawal if the policy value has a gain over deposits, that amount is taxable. The correct answer is: 100% of any withdrawal is tax free

Applicants for an insurance license may take the licensing examination up to how many times in a 12-month period?

Applicants for an insurance license may not take the licensing examination more than 5 times in a 12-month period. The correct answer is: 5

Someone should have what maximum number of Medicare supplement policies?

Application forms must include questions designed to elicit information as to whether, as of the date of the application, the applicant currently has Medicare supplement coverage. An applicant only needs one Medicare Supplement policy. The correct answer is: 1

Shane and Casey both have health plans from work that covers their son Cash. Which plan is primary?

In determining the coordination of benefits, the parent's birthday that is the earliest in the year has primary coverage. In a divorce, whichever parent has custody is primary. The correct answer is: The parent with the earliest birthday in the year is primary.

Which of the following is a true statement about the waiver of premium rider?

In order for the waiver of premium rider to take effect, the disability of the policyholder must be permanent and total. The correct answer is: The disability must be permanent and total.

Which of the following is required in order for Mr. Johnson to be eligible for Medicaid?

In order to qualify for Medicaid, Mr. Johnson does not need to sell his home. He can have a small amount of income and can have personal property within certain limits. The correct answer is: None of the above

When the only logical beneficiary is a minor, all of the following options are available, EXCEPT:

In the event that the only logical beneficiary for a life policy is a minor, the guardian, trust and insurance company holding the proceeds are all options available. The correct answer is: The benefits can go directly to the estate of the insured.

When Mr. Sanders dies, the death benefit is paid to Diane. If Diane dies before Mr. Sanders, the benefits would go to Jane. Which of the following is true?

In this scenario, Mr. Sanders is the insured, Diane is the primary beneficiary and Jane is the contingent beneficiary. The correct answer is: Diane is the primary beneficiary, Jane is the contingent beneficiary.

Which of the following is usually sold as a cost-of-living rider to another policy?

Increasing term provides an increasing face amount. The premiums are level. It is often sold as a cost-of-living rider to another policy. The correct answer is: Increasing Term

Which of the following is NOT a duty or power of the Office of Insurance Regulation?

Legislators write insurance laws. The Office of Insurance Regulation may adopt insurance rules (regulations), but may not alter or write insurance statutes (laws). The correct answer is: Write and amend insurance statutes

How many hours of continuing education in law and ethics are required every 2 years for Florida life and health agents?

Life and health agents must complete 24 hours of continuing education every 2 years. At least 5 of the hours must be in law and ethics. The correct answer is: 5 hours

How many hours of continuing education are required every 2 years for Florida life and health agents who have been licensed for at least 6 years, but less than 25 years?

Life and health agents who have been licensed for at least 6 years must complete 20 hours of continuing education every 2 years. The correct answer is: 20 hours

In Florida, what is the maximum percentage rate that may be charged on a fixed rate policy loan?

Maximum percentage rate that may be charged by an insurance company on a fixed rate policy loan is 10%. The correct answer is: 10%

A state run medical program, funded by the federal government for the poor is:

Medicaid is a state run medical program, funded by the federal government for the poor. The correct answer is: Medicaid

After breaking his leg, Oliver purchased a major medical policy and filed a claim for the treatment on his broken leg. The claim is denied due to:

The event causing the loss happened before the effective date of the policy. The correct answer is: The pre-existing clause

The insuring clause in a health policy includes all of the following, EXCEPT:

The exclusion clause defines what is not covered by the policy. The insuring clause outlines the terms of coverage and the promise to pay in the event of a covered loss. The correct answer is: A definition of losses not covered by the policy

Which of the following must take place in order for a policy to be in effect?

The policy is not in effect until the insurer approves the application, the agent delivers the policy and the initial premium is collected. The correct answer is: All of the above

What defines the timing of the payments on a life insurance policy?

The premium payment mode determines the timing of premium payments, i.e., how often do you want to pay your premiums. Examples: monthly, quarterly, semi-annual (twice a year) or annually (once a year). The correct answer is: Premium payment mode

When renewals come up each year for a one-year renewable term policy, which of the following is required?

The premium will go up each year because Gregory will be another year older. The correct answer is: His premium must go up

If more than one beneficiary is named, who is the first in line?

The primary beneficiary is the first in line, and the contingent is the second in line. The correct answer is: Primary

The principal losses related to accident and health insurance are:

The principal types of losses dealt with in accident and health insurance are medical expenses and loss of income caused by disability. The correct answer is: Loss of income from disability and medical expenses.

All of the following are true about the probationary clause on a health policy, EXCEPT:

The probationary clause is usually added to limit or modify a contract to protect against pre-existing conditions. I The correct answer is: The probationary clause is one of the 12 mandatory clauses

Which of the following is not expected from a producer as part of the field underwriting?

The producer is not expected to note how many children the applicant has in the house. The correct answer is: The producer should note how many children the applicant has in the house.

What are the two perils addressed by health insurance?

The two perils of health insurance are accidental injury and sickness. Accidental injury is an unforeseen and unintentional bodily injury resulting from an accident. Sickness is a medical condition, disease or illness. The correct answer is: Accidental injury and sickness

What is the minimum free look period for a fixed annuity in Florida?

The unconditional refund time (free look period) for a fixed annuity in Florida is at least 21 days. The correct answer is: 21 days

What is the minimum free look period for a variable annuity in Florida?

The unconditional refund time (free look period) for a variable annuity in Florida is at least 21 days. The correct answer is: 21 days

If a company fails to respond to a request for reinstatement, the policy will automatically reinstate in how many days?

The uniform code will force a reinstatement if the company fails to act in 45 days. If the company requests additional information, that extends the period. The correct answer is: 45 days

Dylan and Bob own a small business. They worry about their company if their star salesman becomes disabled. Which type policy should they buy?

They should buy a key employee policy. A key employee policy covers lost income due to a key employee's disability. The correct answer is: Key employee

Which of the following is not an element of insurable risks?

This element of risk should read large number of homogenous units. The correct answer is: Large number of heterogeneous units

What type of disability policy states that a policy can be renewed beyond age 65 if the insured is actively at work?

This example shows that a condition must exist for a contract to be renewable. If someone continues to work beyond age 65, they will be able to continue the policy. The correct answer is: Conditionally renewable contract

An insured became disabled in February of 2014. She had bought a disability income policy in October of 2012. Her disability was due to a condition that existed prior to October 2012 but was not excluded from her policy. The insurer will:

Under these circumstances, the insurer will pay the claim in full. The correct answer is: Pay the claim in full.

All of the following are long-term care policy exclusions, EXCEPT:

Until recently Alzheimer's and organic-based mental illnesses were excluded, but they are no longer excluded. The correct answer is: Alzheimer's

Barbara allows her comprehensive major medical plan to lapse. If her policy is reinstated on March 20th and she contracts mononucleosis on March 29th, what benefits will she receive?

Upon reinstatement, accident is covered immediately, but sickness reinstatement is not covered until a 10-day waiting period has been fulfilled. The correct answer is: None

Agents must keep premium transaction records for a minimum of:

Agents must keep premium transaction records for a minimum of 3 years. The correct answer is: 3 years

Which of the following is not an example of a basic medical expense plan?

Basic plans are sometimes supplemental plans and include all of those listed, except disability. The correct answer is: Disability income

Which of the following are not true about the limited payment option insurance option?

Cash value accumulates more quickly than it does with a continuous premium policy, but it is not immediately. The correct answer is: With the limited payment option, there is immediate cash value.

What type of marketing fails to disclose in a conspicuous manner that a purpose of the method of marketing is solicitation of insurance?

Cold lead advertising is making use directly or indirectly of any method of marketing which fails to disclose in a conspicuous manner that a purpose of the method of marketing is solicitation of insurance and that contact will be made by an insurance agent or insurance company. The correct answer is: Cold lead advertising

Bob has a $30,000 life policy with a double indemnity AD&D rider. If he dies of cancer after 6 months, what would his beneficiaries receive?

$30,000. An accidental death and dismemberment (AD&D) policy will only pay the benefit if the cause of death is accidental. The correct answer is: $30,000

Health Maintenance Organizations are organized as:

A Health Maintenance Organization is organized as a pre-paid medical service plan. The correct answer is: Individually chartered pre-paid service providers

A Medicare supplement insurer cannot deny an application for a Medicare supplement policy nor charge a higher premium if the applicant is under 65 and eligible for Medicare due to disability or:

A Medicare supplement insurer cannot deny an application for a Medicare supplement policy nor charge a higher premium if the applicant is under 65 and eligible for Medicare due to disability or end-stage renal disease (ESRD). The correct answer is: ESRD

Which of the following is not one of the elements required to make a contract legal?

Ambiguities are things that are unclear in a contract. The correct answer is: Ambiguities

A Medicare supplement policy cannot exclude benefits for a pre-existing condition for a person who had how many months of continuous creditable coverage prior to their application?

A Medicare supplement policy cannot exclude benefits for a pre-existing condition for a person who had 6 months of continuous creditable coverage prior to their application. The correct answer is: 6 months

Who must sign the Notice Regarding Replacement of Medicare Supplement Coverage?

A Notice Regarding Replacement of Medicare Supplement Coverage must be signed by the applicant and the replacing agent. The correct answer is: The applicant and the replacing agent

When presenting long-term care or Medicare Supplement plans, it is necessary to provide the prospect with a:

A Shoppers Guide (Outline of Coverage) is required for many sales to senior citizens. The correct answer is: A Shoppers Guide for the product presented

A business may be the beneficiary on any of the following policies, EXCEPT:

A business is not allowed to be the beneficiary of a group plan that is designed to provide benefits for the employee's family. The correct answer is: A group insurance policy of one of the employees

A gift for the purposes of advertising is allowed if the value is not more than:

A gift for the purposes of advertising is allowed if the value is not more than $25.00. The correct answer is: $25

Guaranteed renewable means:

A guaranteed renewable policy does allow the insurance company to increase premiums on a like group of policies. The correct answer is: The insurance company must renew the policy each year, but they may increase premiums for all policies in a specified group, but they may not increase premiums on single individuals.

In a health policy, the incontestable provision is referred to as:

A health insurance plan does not have an incontestable clause. The standard clause is called a time limit for certain defenses. The correct answer is: Time limit for certain defenses

A health insurance policy that covers family members must cover adopted children:

A health insurance policy that covers family members must cover adopted children from the moment of placement in the residence of the insured. The correct answer is: From the moment of placement in the residence

A hospital indemnity plan will provide:

A hospital indemnity plan will pay a daily allowance for each day the insured is in the hospital. The correct answer is: A specific benefit based on the number of in hospital days

What is the maximum percentage of premiums for policies sold by a licensee in a 12-month period can be from controlled business?

A license will be considered to have been used to write controlled business if during a 12-month period the premiums from controlled business exceed the premiums for life or health insurance contracts to the general public. The correct answer is: 50%

Life insurance applications require a signature from:

A life insurance application requires the agent, proposed insured, and the policy owner if different from the insured to sign it. The correct answer is: All of the above

The insurer can void a life policy during the contestable period for:

A life-threatening medical condition would be grounds for voiding a policy during the contestable period. The correct answer is: Not divulging a life-threatening medical condition

A medical policy that states that in no case will the insurance company's liability exceed $1,000,000 has:

A lifetime maximum is the only feasible answer. The correct answer is: Has a lifetime maximum

A notice of claim must be given within how many days?

A notice of claim must be given to the insurer within 20 days. The correct answer is: 20 days

A group plan's underwriting varies from individual plan underwriting in all of the following ways, EXCEPT:

A participant in a group plan receives a certificate. The correct answer is: Participants in a group receive individual policies as evidence of coverage.

James has agreed to purchase health insurance. When will the coverage be in force?

A policy is generally not in force until the agent has delivered it to the insured AND the initial premium has been paid. The correct answer is: When the agent delivers the policy to the insured

Which of the following is true about the loan status after a loan is made from the cash value of a life policy?

A policy loan does not have to be repaid. Insurers do assess interest on the loan. Any loan balance is deducted from the proceeds if the loan is outstanding when the insured dies. Policyowners can borrow more than 50% of the cash value. The correct answer is: Outstanding loan balances are deducted from policy proceeds.

Dylan is looking at buying an equity-indexed life policy; it will likely be tied to:

A policy that is interest sensitive would be linked to the CPI. The correct answer is: DJIA

All of the following are true about personal contracts, EXCEPT:

A policyowner has ownership of their life insurance contract and can give it away (a process called assignment), if they so choose. The correct answer is: Life insurance contracts cannot be assigned.

The cheapest premium payment mode would be on a policy that is paid:

A premium that is paid annually would be the cheapest. The more frequent the payments, the more expensive a premium will be. The correct answer is: Annually

One of the features an insurance company can utilize to limit claims for pre-existing conditions is:

A probationary period will set a time limit before health conditions will be covered. The correct answer is: A probationary period

At what age would a qualified retirement plan distribution be premature?

A qualified retirement plan distribution would be premature if made before 59 1/2 , and subject to a 10% tax penalty. The correct answer is: 59 1/2

A representation is:

A representation is a statement that the applicant provides that is true to the best of their knowledge. The correct answer is: Any statement made is true to the best of the applicant's recollection, but facts may not be exact.

Which of the following is correct concerning representations?

A representation is a statement that the insured believes to be true, but the actual facts might vary. The correct answer is: Carla has represented that the information she has furnished is true to the best of her knowledge.

The beneficiary designation that allows the policy to be changed without the beneficiary's consent:

A revocable beneficiary means the policy can be changed without the consent. An irrevocable beneficiary means the policy cannot be changed without the beneficiaries consent. The correct answer is: Revocable

An example of coverage that can be purchased by a husband for his wife along with other dependent family members is:

A rider that would cover both the spouse and dependent children is called a family term rider. The correct answer is: A family term rider

Universal life policies are similar to whole life in that they:

Both a whole life policy and a universal life policy provide death protection and cash value. The similarities end there. The correct answer is: Both provide death protection and cash value

Which of the following is NOT considered to be an activity of daily living that might be used as a "trigger" for the payment of benefits?

Activities of daily living will include at least the following: bathing, continence, dressing, eating, toileting, and transferring. Driving is not considered a required daily activity. The correct answer is: Driving

All of the following practices must be used by agents selling annuities to senior citizens, EXCEPT:

Agents selling annuities to senior citizens must not use cold lead advertising, high pressure tactics or twisting. The correct answer is: Cold lead advertising

Who are the members of the Florida Life and Health Guaranty Association?

All member insurers must be members of the association as a condition to eligibility to transact insurance in Florida. In addition, member insurers are assessed amounts to contribute to the guaranty fund for insurer insolvency. The correct answer is: All insurers authorized by the state of Florida

What is the sequence of filing a claim?

All of the parts of a claim have time limits attached, but the rule of what is reasonable applies in all cases. The correct answer is: Insured notifies the company of loss, company furnishes claim form, Insured provides proof of loss and the company pays claim within prescribed time limit

Amanda provided information to the best of her recollection on her insurance application. This is referred to as a:

All the statements on an insurance application are considered representations. The correct answer is: Representation

What type of care is provided when traditional home health or skilled nursing treatment is not necessary?

Alternate care is care that is provided when traditional home health or skilled nursing treatment is not necessary. The correct answer is: Alternate care

Which of the following must an insurer have to be an admitted insurer?

An admitted (authorized) insurer is one duly authorized by holding a certificate of authority issued by the Office of Insurance Regulation to transact insurance in Florida. An unauthorized insurer does not have a certificate of authority, and includes excess and surplus lines insurers. The correct answer is: A Certificate of Authority

When must an agent for a long-term care policy deliver the buyer's guide?

An agent for a long-term care policy must deliver the buyer's guide prior to the presentation of the application or enrollment form. The correct answer is: Prior to the sales presentation

In Florida, the term "agent" includes which of the following?

An agent is a general lines agent, life agent, health agent, or title agent. In Florida, the term "agent" does not include a customer service representative, limited customer representative, or service representative. The correct answer is: General lines agent

What type of insurer is formed under the laws of anyplace outside the United States?

An alien insurer is one formed under the laws of any place outside the United States. The correct answer is: Alien

What happens if the age of an insured person has been misstated on a life policy?

An equitable adjustment of premiums or benefits will be made if the age of an insured person has been misstated on a life policy. The correct answer is: An equitable adjustment of premiums or benefits will be made.

What is the rule on an individual obtaining both Medicare supplement coverage and Medicaid coverage?

An individual is prohibited from obtaining both Medicare supplement coverage and Medicaid coverage, except in certain situations. The correct answer is: An individual can have both in certain situations.

When must an insurance agent provide a Buyer's Guide to the applicant of a policy that contains an unconditional refund provision?

An insurance agent must provide a Buyer's Guide and a Policy Summary prior to or with policy delivery if the policy contains an unconditional refund provision for a period of at least 14 days. The correct answer is: With the policy delivery

Oliver has been approved for his new health insurance policy. When will he see a complete outline of coverage?

An outline of coverage is one of the requirements for delivery of the policy. The correct answer is: When the policy is delivered with all the other papers

Which insurers are NOT required to have a Certificate of Authority?

An unauthorized insurer does not have a certificate of authority, and includes excess and surplus lines insurers. The correct answer is: Excess and surplus lines insurers

An underwriter will consider which of the following conditions in making their decision to approve an application for health insurance?

An underwriter should be informed about any conditions that existed prior to an application for health insurance. The correct answer is: A condition that occurs prior to making an application for health insurance

In what type of life insurance policy will premiums increase each policy anniversary based on current age?

Annual renewable term will maintain the same face amount, but premiums increase as the policy holder advances in age. The correct answer is: Annual renewable term

Which of the following is NOT an unfair claim practice?

Any of the following acts, if committed without just cause and performed frequently, constitute improper and unfair claim practices: knowingly misrepresenting to claimants pertinent facts, failing to affirm or deny coverage of claims, offering to settle claims for an amount less than the amount reasonably due and many others. The correct answer is: Asking for further information

A person insured under a group life insurance policy may make an assignment of all of the following, EXCEPT:

Any person insured under a group life insurance policy may make an assignment of all or any part of their incidents of ownership under such policy including: conversion, the right to name a beneficiary, assign policy proceeds. All incidents of ownership may be assigned, without prejudice to the insurer on account of any payment it may make or individual policy it may issue. The correct answer is: Dividends

A person insured under a group life insurance policy may make an assignment of all of the following, EXCEPT:

Any person insured under a group life insurance policy may make an assignment of all or any part of their incidents of ownership under such policy including: conversion, the right to name a beneficiary, assign policy proceeds. All incidents of ownership may be assigned, without prejudice to the insurer on account of any payment it may make or individual policy it may issue. The correct answer is: Premiums

Which of the following best describes a policy or contract of insurance against injury resulting from accident or accidental means and insures a group of persons?

Any policy or contract of insurance against death or injury resulting from accident or from accidental means which insures a group of persons will be deemed a blanket accident policy. The correct answer is: Blanket accident insurance

Who must sign the notice regarding replacement?

Applicants replacing a life insurance policy must receive a notice regarding replacement. The notice will be signed by both the applicant and the producer. The correct answer is: The applicant and the producer

Applications for long-term care insurance must include questions for all of the following, EXCEPT:

Applications for long-term care insurance must include questions on whether an applicant has long-term care insurance and whether an applicant is replacing long-term care insurance or accident and sickness insurance. The correct answer is: Whether an applicant has life insurance

To remain in force, appointments must be renewed every:

Appointments continue in force until suspended, revoked, or terminated. To remain in force, appointments must be renewed every 24 months. The correct answer is: 2 years

The company wants to provide additional benefits to certain classes of employees under a group health plan. They can do this as long as the classes are not based on:

As long as the additional benefits are not based on the gender of the employee, they may be offered to certain classes of employees in a group health plan. The correct answer is: The gender of the employee.

What percentage of the benefits received from a health insurance company after an accident are taxable?

As long as the benefits paid to the taxpayer do not exceed the actual expenses incurred, the benefits are not taxable. The correct answer is: None

In the event an insured has elected the waiver of premium benefit he/she will receive which of the following benefits?

As long as the insured meets the qualifications for being disabled, the insurance company will 'waive' premiums due until the insured is no longer disabled. The correct answer is: Waiver of premium allows the insured to maintain an in force policy while disabled.

An appointing entity must report the termination of an agent to the Florida Department of Insurance within:

As soon as possible and at all events within 30 days after terminating the appointment of an appointee, other than for failure to continue or renew it, the appointing entity will file written notice of the termination of appointment with the department, together with a statement that it has given the appointee notice and will file with the department the reasons and facts involved in such termination. The correct answer is: 30 days

How much time does an appointing entity have to report a termination to the Florida Department of Insurance?

As soon as possible and at all events within 30 days after terminating the appointment of an appointee, other than for failure to continue or renew it, the appointing entity will file written notice of the termination of appointment with the department, together with a statement that it has given the appointee notice and will file with the department the reasons and facts involved in such termination. The correct answer is: 30 days

If Kenneth has the right to assign his benefits on his health contract, this means that he may:

Assignment is not only a convenient way to settle medical bills, some providers insist on it when a large bill is involved. The correct answer is: Assign his benefits directly to a provider and allow his insurance plan to pay the provider directly

A binding arrangement under which an insured requests that payments under their health plan be made directly to a person or facility that they designate (such as a doctor or hospital) is called:

Assignment of benefits is a binding arrangement under which an insured requests that payments under their health plan be made directly to a person or facility that they designate (such as a doctor or hospital). The correct answer is: Assignment of benefits

A statement that the insured will not receive more that $100,000 in benefits in any one calendar year is known as:

At any time a policy limits payments for one calendar year, it is know as an annual maximum policy. The correct answer is: Annual maximum

Steve bought a 20-year, $200,000 decreasing term policy in 2001 and a $500,000 whole life policy. Steve died in 2006. What were the total benefits payable to his beneficiary?

Because he died after 5 years, the policy death benefit was worth $150,000. His whole life policy paid the full face value of $500,000 upon his death. The total paid to his beneficiary was $650,000. The correct answer is: $650,000

Which of the following would result in a premium increase for an adjustable life insurance policy?

Because term insurance is generally less expensive than whole life insurance, if the policyowner converted a term policy to a whole life policy - with the same face value - the premiums would increase. The correct answer is: Converting a term policy to a whole life policy with the same face value

Which of the following is a major difference between a variable life policy and a universal policy?

Because the cash values are linked to equity investments and securities, they are not guaranteed. This linking results in regulation as a security, and regulation by the SED. Premiums paid for a variable life policy must be placed in a separate account containing securities-based investments. The correct answer is: All of the above

All of the following statements are true about decreasing term, EXCEPT:

Because the policy is worth-0- at the end of the policy period, it is not a type of insurance that would be considered useful for someone looking to fund an investment. The correct answer is: Decreasing term is useful for people wishing to purchase life insurance for an investment.

Which of the following is not a requirement of a group policy?

Beneficiaries are underwritten as a group. Beneficiaries are covered under the master contract, and have conversion privileges. The correct answer is: Beneficiaries are underwritten individually.

All of the following are typical managed care providers, EXCEPT:

Blue Cross is one of the largest provides of health care in the US. Although they do contract with hospitals and doctors, they are not considered a managed care provider in the same light as an HMO, PPO, or POS. The correct answer is: Blue Cross

Which of the following is not an element of the nonforfeiture value of a whole life insurance policy?

Cash withdrawn from a whole life policy DOES reduce the face value of the policy as well as the cash value of the policy. The correct answer is: Cash withdrawn does not reduce the face value of the policy.

Which of the following is best described as using life insurance policy cash values to purchase a new life insurance policy in a deceptive and misleading manner?

Churning is the fraudulent and misleading replacement of life insurance policies with the same insurer. Churning is an unfair and deceptive practice. The correct answer is: Churning

After receiving notice of a claim, the insurer has a maximum of how many days to provide claims forms?

Claims forms must be provided to the claimant a maximum of 15 days after receiving a notice of claim. The correct answer is: 15 days

According to the Fair Credit Reporting Act, which of the following is contained consumer reports?

Consumer reports are reports about the characteristics of an individual, including the individual's general character and reputation, employment history, living arrangements, and credit worthiness. The correct answer is: Information concerning an individual's character

On April 9, an application is submitted without the initial premium. The insurer requires a medical exam, and it is completed on April 14. On April 18, the insurer issued the policy, and the producer delivers it on April 21. When is coverage effective?

Coverage begins on April 21, after the statement of good health is signed, and the initial premium is paid. The correct answer is: April 21, after the statement of good health is signed, and the initial premium is paid.

On January 3, an application is submitted without the initial premium. The insurer requires a medical exam, and it is completed on January 15. On January 20, the insurer issued the policy standard, and the producer delivers it on January 22. When is coverage effective?

Coverage begins on January 22, after the statement of good health is signed, and the initial premium is paid. The correct answer is: January 22, after the statement of good health is signed, and the initial premium is paid.

Susan bought an accidental death coverage for her car loan. If Susan dies as a result of an accident, what benefits will be payable?

Credit insurance is designed to protect the lender. Benefits are paid to the lender in the amount of indebtedness at the time of death. The correct answer is: A benefit of the outstanding balance will be paid to the lender.

What type of care is provided to assist an individual with ADLs, performed by a medical non-professional under a physician's orders?

Custodial care is provided to assist an individual with ADLs, performed by a medical non-professional under a physician's orders. The correct answer is: Custodial care

What is a provider of health care, or a group of providers of health care, that has entered into a written agreement with the insurer to provide benefits under a health insurance policy and provides reasonable access to health care providers?

Exclusive Provider Organization (EPO) is a provider of health care, or a group of providers of health care, that has entered into a written agreement with the insurer to provide benefits under a health insurance policy and provides reasonable access to health care providers. The correct answer is: EPO

Comprehensive major medical health policies typically have an Eligible Expenses provision that specifies coverage for all but:

Experimental and investigative services are not normally considered eligible expenses. The correct answer is: Experimental services.

Securities licenses must be obtained through:

FINRA (Financial Industry Regulatory Authority) was formerly known as the NASD (National Association of Securities Dealers). Securities licenses are obtained through FINRA. The correct answer is: FINRA

Before starting a flexible spending account someone should do all of the following, EXCEPT:

Flexible spending accounts do not have a carry forward provision with their accounts. The correct answer is: Sign up for the maximum allowable, since she can carry any balance over to the next tax year

Florida Healthy Kids is mainly for school age children who are ineligible for Medicaid and whose family income is below:

Florida Healthy Kids is mainly for school age children whose family income is below 200% of the federal poverty level and are ineligible for Medicaid. The correct answer is: 200% of the federal poverty level

Florida Healthy Kids provides health insurance to children who are eligible for assistance under:

Florida Healthy Kids provides health insurance to children who are eligible for assistance under Title XXI of the Social Security Act. The correct answer is: Title XXI of the Social Security Act

Florida created the Small Employers Access Program to specifically target employers with up to how many employees?

Florida created the Small Employers Access Program to specifically target employers with up to 25 employees. The correct answer is: 25

Which of the following is NOT a requirement for a policy in Floridas Long-term Care Partnership Program?

Floridas Long-term Care Partnership policies must meet the following requirements: qualified policy, issued to a Florida resident or another state that has entered into a reciprocal agreement with Florida, issued with inflation protection coverage and annual inflation coverage for individuals age 61 to age 75. The correct answer is: Issued to Florida residents only

Which of the following is NOT a duty of the Officer of the Office of Insurance Regulation?

General powers and duties include: Enforce the provisions of the Insurance Code and execute the duties imposed by the Insurance Code; Powers and authority expressly conferred upon it by the Insurance Code; Conduct investigations of insurance matters, in addition to investigations expressly authorized, to determine if any person has violated an insurance law; Collect, propose, publish, and disseminate information relating to the subject matter of any duties imposed upon it by the Insurance Code. The correct answer is: Create and update state insurance laws

If an insurance agent offers to split their commission with a prospective applicant, this would be considered:

Giving any part of a commission to an applicant to entice them to buy a policy, is rebating and is illegal. The correct answer is: Rebating

A group long-term disability plan may contain all of the following features, EXCEPT:

Group plans are generally designed to prevent 'over insurance'. That is why the benefit is usually a maximum of payroll not to exceed a total amount, such as 60% of pay not to exceed $7,500 per month. The correct answer is: The benefit is not usually stated as a percent of income.

HMO contracts must provide coverage for newborn children of a family member from the moment of birth for at least:

HMO contracts that provide coverage for a family member of the insured must also provide coverage for the insured's newborn children from the moment of birth. Coverage must be also be provided for the newborn child of a covered family member (such as the newborn of a daughter) for 18 months after the birth. The correct answer is: 18 months

HMOs are based on all of the following, EXCEPT:

HMOs are based on early detection, prevention care and volume discount, not fee-for-service. The correct answer is: Fee-for-service

Health Savings Accounts ( HSA's) are frequently used with:

HSAs are frequently used with HDHPs (High deductible health plans). The correct answer is: HDHPs (High Deductible Health Plans)

Tyler owns a major medical policy with 70/30 coinsurance and a $3,000 deductible. If he submits a claim for $20,000, how much will he pay?

He'll pay $8,100. The math works out $20,000 - $3,000 = $17,000. Then $17,000 x .30 = $5,100. Then add the $3,000 deductible with the $5,100 coinsurance ($3,000 + $5,100= $8,100). The correct answer is: $8,100

What is the primary difference between a flexible spending account and a health savings account?

Health savings accounts may be carried over from year to year. Flexible spending accounts are a 'use or lose it' proposition. The correct answer is: Health savings accounts can be carried over from year to year.

What is any method of marketing having the effect of or tending to induce the purchase of insurance through force, fright, or threat?

High pressure tactics employ any method of marketing having the effect of or tending to induce the purchase of insurance through force, fright, threat, whether explicit or implied, or undue pressure to purchase or recommend the purchase of insurance. The correct answer is: High pressure tactics

What type of care focuses on providing pain management and comfort, rather than curing an individual's ailments?

Hospice care focuses on providing pain management and comfort, rather than curing an individual's ailments. Hospice care is typically for individuals with terminal illnesses. The correct answer is: Hospice care

Joshua bought a straight life contract knowing that when it matures the cash value is equal to the death benefit. Before he died, Joshua borrowed the cash value of the policy. How were the proceeds of the policy handled when he died?

If Joshua dies before he repays the cash borrowed against his policy, upon his death the cash value would be paid back, with interest. The correct answer is: The cash value is paid back with interest.

An insured filed a claim with her insurance company and submitted all the proof of loss requested. The insurer is non-responsive. How many days must the insured wait before beginning legal action to recover her money?

If a claim has not been paid after all proof of loss has been submitted, the insured must wait 60 days before instituting legal action. The correct answer is: 60 days

If a dependent child is covered by 2 health policies from divorced or separated parents, which policy pays first?

If a dependent child is covered by 2 health policies from divorced or separated parents, the policy of the parent with custody pays first, the policy of the spouse of the parent with custody pays second, and the policy of the parent without custody pays third. The correct answer is: The policy of the parent with custody

How much time does an individual have to convert to a new individual life policy after the termination of their group life policy?

If a group life policy is terminated, the members and dependents may convert their group coverage to individual life coverage. The individual must apply for individual coverage within 31 days after the date of group coverage termination. The correct answer is: 31 days

Which of the following is the classification for an individual that would pose the least amount of risk to the insurer?

If a person has above average physical condition, a safe and secure lifestyle, they would be classified as preferred because they represent a lower risk to the insurer. The correct answer is: Preferred

If a person is covered by 2 health policies, one of which is Medicare, when does Medicare pay?

If a person is covered by 2 health policies, one of which is Medicare, then Medicare is always secondary. The correct answer is: Second always

Who pays the claim if someone dies during the conversion period from a group life policy to an individual life policy?

If a person who was insured under a group life policy dies during the conversion period to an individual life policy, the group policy pays the claim. The correct answer is: Group life policy

When a new policy is returned under the free look provision, a company is required to do all of the following, EXCEPT:

If a policy is returned within the free look period, the insurance company is required to refund full premiums promptly. The correct answer is: Reimburse the agent for lost commissions

Which of the following is true when a policy is written as cancellable?

If a policy is written as cancellable, the insurance company may cancel at any time by refunding any unearned premiums. The correct answer is: The insurance company may cancel at any time by returning the unearned premiums.

Claudia cannot change the beneficiary on her life policy by:

If a policyowner wishes to change a beneficiary on a life insurance policy, the policyowner must contact the insurer, by mail, phone or endorsement. The correct answer is: Designating the change of beneficiary in her will

If an individual has a chronic medical condition, how is the insurer likely to handle this situation when issuing an individual health policy?

If an applicant has a chronic medical condition, or existing medical condition, the insurer could exclude the condition with an Impairment rider. The correct answer is: The insurer will exclude the condition with an Impairment rider.

Marsha left her company and died during the period allowed for her to convert her life insurance to an individual policy. What happens to the benefits of the policy?

If an employee covered under a group policy dies during the conversion period, the insurer pays the death benefit, in full. The correct answer is: The insurer pays the death benefit in full.

What is the advantage of a Waiver of Premium provision in a life policy?

If an insured becomes totally disabled before a certain age, this provision would waive the premiums. The correct answer is: Waive an insured's premiums if he/she becomes disabled.

What does a producer do at delivery if, he submits an application with a premium. After underwriting, the insurer sends back the policy, rated, with an impairment rider.

If the policy is rated, the producer needs to explain the issue and collect an additional premium. The correct answer is: Explain the issue and collect an additional premium.

Which of the following is not true about universal life insurance?

If the policyowner pays the target premium, the policy will build cash value and be similar to whole life. If the policyowner pays the minimum premium, the policy will remain in force, and the death benefit intact. The correct answer is: The policyowner cannot skip premium payments.

What rider excludes coverage for a specific condition on a health insurance policy?

Impairment riders exclude coverage for a certain medical condition. The correct answer is: Impairment rider

In Florida, what is the maximum number of employees to be considered a "small employer?"

In Florida, a "small employer" has at least 1 and not more than 50 employees. The correct answer is: 50

In Florida, what is the minimum number of employees for a small employer health plan to be guaranteed issuer?

In Florida, all small employer health plans must be guaranteed issue to every small employer with 2 to 50 employees. The correct answer is: 2

In Florida, if a long-term care policy lapses unintentionally, it may be reinstated if the insured had a continuous confinement for more than:

In Florida, if a long-term care policy lapses unintentionally, it may be reinstated if the insured had a continuous confinement for more than 60 days. The correct answer is: 60 days

In Florida, insurance is regulated by how many different parties?

In Florida, insurance is regulated by 4 parties: Department of Financial Services and CFO, Commissioner of the Office of Insurance Regulation, Florida state legislature, and the Florida state court system. The correct answer is: 4

In Florida, insurance is regulated by all the following, EXCEPT:

In Florida, insurance is regulated by 4 parties: Department of Financial Services and CFO, Commissioner of the Office of Insurance Regulation, Florida state legislature, and the Florida state court system. The correct answer is: U.S. court system

In Florida, what is the minimum number of members required for a group policy?

In Florida, there is no minimum number of members required for a group policy. The correct answer is: There is no minimum.

In a group life policy, an insured's dependent children may be covered up to what percentage of the amount of insurance for which the employee is insured?

In a group life policy, an insured's dependent spouse and children may be covered up to an amount not to exceed the amount of insurance for which the employee or member is insured. The correct answer is: 100%

In a group life policy, an insured's dependent spouse and children may be covered up to what percentage of the amount of insurance for which the employee is insured?

In a group life policy, an insured's dependent spouse and children may be covered up to an amount not to exceed the amount of insurance for which the employee or member is insured. The correct answer is: 100%

In a group life policy, an insured's dependent spouse may be covered up to what percentage of the amount of insurance for which the employee is insured?

In a group life policy, an insured's dependent spouse and children may be covered up to an amount not to exceed the amount of insurance for which the employee or member is insured. The correct answer is: 100%

Investment risk is completely taken by the policyowner is what type policy?

In a variable universal life policy the policyover has all the investment risk. The correct answer is: Variable universal life

The return of premium rider is actually:

In actuality, the return of premium rider is an increasing term insurance that will be equal to the total of premiums paid. The correct answer is: Increasing term insurance

In life insurance, insurable interest must be present at the time of:

Insurable interest must be present when the application is made. The correct answer is: Application

Insurance advertisements may not imply that dividends or divisible surplus is:

Insurance advertisements may not imply that dividends or divisible surplus is guaranteed. The correct answer is: Guaranteed

What is a person who can also receive information for a policyholder's life policy?

Insurers must notify the applicant of their right to designate a secondary addressee at the time of application or at anytime the policy is in force. The correct answer is: A secondary addressee

When can someone designate a secondary addressee for a life policy?

Insurers must notify the applicant of their right to designate a secondary addressee at the time of application or at anytime the policy is in force. The correct answer is: At the time of application or at anytime the policy is in force

All of the following are commonly used when investigating the insurability of an applicant, EXCEPT:

Insurers typically utilize the physician's statement, credit report and MIB when determining insurability of an applicant. They do not talk to the neighborhood watch. The correct answer is: Talking to the neighborhood watch

What life insurance policy provides a blend of the benefits of traditional whole life and universal life?

Interest-sensitive whole life is a mixture of traditional whole life and universal life. The correct answer is: Interest-sensitive whole life

What type of care is nursing care and rehabilitation needed on an occasional basis that is performed by a medical professional under a physician's orders?

Intermediate care is nursing care and rehabilitation needed on an occasional basis, performed by a medical professional under a physician's orders. The correct answer is: Intermediate care

An underwriter has determined that a person will not qualify for a standard issue policy. The underwriter may choose any of the following actions, EXCEPT:

Issuing a policy under these conditions would be the same as offering insurance at the company's whim. This would give the company the right to cancel the policy if a claim occurred. The correct answer is: Issue the policy with a probationary period allowing the company to cancel the policy at a later date at their option

Gregory recently purchased a one-year term insurance policy. At the end of the year, he can purchase an identical policy without having to show proof of insurability. Why type of policy did he purchase?

It is a renewable term policy that allows the policyowner to purchase another identical policy at the end of the year without proving insurability. The correct answer is: Renewable term

If a replacement is involved, the agent must do all of the following, EXCEPT:

It is the duty of the insurer to notify the outgoing insurance company of policies being replaced, and provide a policy comparison statement. The correct answer is: Notify the insurer of the policy being replaced - of any policies to be replaced.

What kind of policy provides the option for the policyowner to pay for the entire policy over a specific and usually shorter period of time and grows cash value faster than ordinary life and matures when the insured reaches age 100 or dies?

It is the limited-payment whole life that has a shorter premium payment schedule and grows cash value faster. The correct answer is: A limited-payment whole life

One common exclusion for short-term disability policies is:

It is usual for both company sponsored and state sponsored short-term disability plans to exclude on the job injuries. The correct answer is: On the job injuries are not covered.

Jim has a life policy with a face value of $250,000 and a total of $25,000 in loans and interest outstanding on the policy. He is killed in a skiing accident. With his double indemnity rider, how much in benefits will the policy pay?

Jim's policy, with the double indemnity rider, has a death benefit of $500,000 (double $250,000). Subtract the outstanding policy loan of $25,000. The policy will pay $475,000. The correct answer is: $475,000

Based on the following, which of the statements is true? When John dies, the death benefit will be paid to Sherrie. If Sherrie dies before John, the benefit would go to Collin.

John is the policyholder and Sherrie is the primary beneficiary. Collin is the contingent beneficiary The correct answer is: The primary beneficiary is Sherrie, and the Collin is the contingent beneficiary.

What type policy would pay the death benefits after the first person dies, if it covers two or more lives?

Joint life pays the death benefits after the first person dies. A survivorship life policy pays after the second person or last survivor dies. The correct answer is: Joint life

Life insurance policy proceeds are exempt from:

Life insurance policy proceeds are exempt from creditors claims unless the proceeds have been assigned to creditors. The correct answer is: Creditors

Long-term care plans are written as:

Long-term care policies are usually not cancellable by the insurance company, but the company does have the right to increase premiums. The correct answer is: Guaranteed renewable

A health policy will usually exclude losses related to all of the following, EXCEPT:

Losses from an accident will not be excluded unless the insured is engaged in the other activities listed. The correct answer is: Losses from an auto accident when the insured was at fault

In Florida, what is the maximum interest rate that may be charged for late payments for individual insurance polices?

Maximum percentage rate that may be charged by an insurance company on late payments for individual insurance polices is 8%. The correct answer is: 8%

How is Medicaid funded?

Medicaid is a form of welfare and is funded by the federal government and the individual states. The states administer the program in their locale. Rules and qualifications may vary due to differences in the states. The correct answer is: Jointly funded by individual states and the federal government

Medicare Advantage Plans include all the following, EXCEPT:

Medicare Advantage Plans include Health Maintenance Organizations, Preferred Provider Organizations, Private Fee-for-Service Plans, Special Needs Plans, and Medicare Medical Savings Account Plans. The correct answer is: EPOs

Medicare Advantage plans are a type of Medicare health plan offered by:

Medicare Advantage plans are a type of Medicare health plan offered by a private company that contracts with Medicare to provide all the Part A and Part B benefits. The correct answer is: A private company that contracts with Medicare

What is a type of Medicare health plan that provides all the Part A and Part B benefits?

Medicare Advantage plans are a type of Medicare health plan offered by a private company that contracts with Medicare to provide all the Part A and Part B benefits. The correct answer is: Medicare Advantage

A Medicare Supplement plan is written on which of the following bases?

Medicare Supplement plans must be guaranteed renewable. The correct answer is: Guaranteed renewable

When an agent or insurer does not truthfully explain the terms of an insurance policy, this is:

Misrepresentation is when an agent or an insurer misrepresents the terms, benefits, limitations, or exclusions of a policy. The agent or insurer makes untrue or misleading statements of fact or law, and fails to state material facts or other disclosures as required by law. The correct answer is: Misrepresentation

Over-funded life insurance policies where the proceeds are subject to taxation are called:

Modified endowment contracts are over-funded life insurance policies in which proceeds are subject to taxation. The correct answer is: MECs

What consist of 2 or more employers or labor unions seeking group health insurance coverage by joining together to form a larger group?

Multiple Employer Welfare Arrangements (MEWAs) consist of 2 or more employers or labor unions seeking group health insurance coverage by joining together to form a larger group. The correct answer is: MEWA

Which of the following are commercial companies owned by policyholders?

Mutual insurers are commercial companies owned by their policyholders. The correct answer is: Mutual insurers

What is the rule on Medicare supplement policies duplicating benefits provided by Medicare?

No Medicare supplement policy issued in Florida may duplicate benefits provided by Medicare. The correct answer is: Benefits must never be duplicated.

What is the rule on a Medicare supplement policy duplicating benefits provided by Medicare?

No Medicare supplement policy may duplicate benefits provided by Medicare. The correct answer is: Benefits must never be duplicated.

A rebate would NOT be allowed for which of the following?

No insurance agency agent shall rebate any portion of a commission except as follows: the rebate shall be available to all insureds in the same actuarial class, the rebate shall be in accordance with a rebating schedule filed by the agent, and the age, sex, place of residence, race, nationality, ethnic origin, marital status, or occupation of the insured or location of the risk is not utilized in determining the rebate. The correct answer is: Rebate requires the purchase of collateral business

A rebate is allowed for people based on which of the following?

No insurance agency agent shall rebate any portion of a commission unless the rebate is available to all insureds in the same actuarial class and the age, sex, place of residence, race, nationality, ethnic origin, marital status, or occupation of the insured or location of the risk is not utilized in determining the percentage of the rebate or whether a rebate is available. The correct answer is: Actuarial class

A policy issued on a non-cancellable basis means:

Non-cancellable means that premiums are guaranteed and the company will not be allowed to cancel the policy. The correct answer is: The policy may not be cancelled by the insurance company, and the premiums are guaranteed for the term of the policy.

In order to transact insurance policies in Florida, insurance agents must be:

Only licensed and appointed insurance agents may transact life and health insurance policies in Florida. The correct answer is: Licensed and appointed

Agents are paid by which of the following?

Only licensed and appointed insurance agents may transact life and health insurance policies in Florida. Agents are paid by commissions, which are apportioned from policy premiums. Agents are permitted to charge additional amounts if they provide counseling services for insurance, and a written contract is signed between the agent and client before the additional fee is charged. The correct answer is: Commissions and counseling service fees

How are agents' commissions paid?

Only licensed and appointed insurance agents may transact life and health insurance policies in Florida. Agents are paid by commissions, which are apportioned from policy premiums. Agents are permitted to charge additional amounts if they provide counseling services for insurance, and a written contract is signed between the agent and client before the additional fee is charged. The correct answer is: Commissions are apportioned from policy premiums.

Samantha purchased a universal life policy when the death benefit in the policy was $200,000. With a current cash value of $50,000, she has selected death benefit option B. How much is her current death benefit?

Option B of a universal life policy provides for the death benefit to equal the face amount plus the cash value. The premiums are higher if the policyowner selects this option. The correct answer is: $250,000

Which of the following offers the broadest service area and broadest selection of providers?

PPO's offer the broadest service area and broadest selection of providers. The correct answer is: PPO

What is an entity which, in return for a prepayment, undertakes to provide or arrange for, or provide access to, the provision of a limited health service to enrollees through an exclusive panel of providers?

Prepaid limited health service organization (PLHSO) is defined as any person, corporation, partnership, or any other entity which, in return for a prepayment, undertakes to provide or arrange for, or provide access to, the provision of a limited health service to enrollees through an exclusive panel of providers. The correct answer is: PLHSO

When Sidney passed away, it was discovered that he had always been listed as female. How did this discovery affect the policy benefits?

Rates for men are typically higher than for women. The death benefit would be decreased to compensate for the underpayment of premiums over the years. The correct answer is: The death benefit was decreased.

The acceptance by insurers of a portion of the risk underwritten by another insurer is:

Reinsurance is the acceptance by one or more insurers, called reinsurers, of a portion of the risk underwritten by another insurer who has contracted for the entire coverage. The correct answer is: Reinsurance

Jamie has a renewable term policy. Which of the following is not an incorrect statement about this type of policy.

Renewability is the insurer's option - is the only correct statement. The correct answer is: Renewability is the insurer's option.

When Jason filled out his application his statements had to be ______________ to be considered legal.

Representations, made to the best of Jason's knowledge, are considered legal. The correct answer is: Representations

Which of the following is a benefit of a qualified retirement plan?

Retirement plans that meet the requirements of the Internal Revenue Code Section 401(a) and ERISA (Employee Retirement Income Security Act) are tax qualified, thus eligible for favorable tax treatment. All of the items listed are benefits of a qualified retirement plan. The correct answer is: All of the above

Maria, an agent, completed an application on Don for health insurance. Before transmitting the application to her home office, Maria should do which of the following?

She should complete and sign the agent's report. The correct answer is: Complete and sign the agent's report.

Irving has a policy that states that his coverage is renewable to age 65 and beyond that age in the event certain circumstances are present. This type of renewability is know as :

Since outlined circumstances must be present in order to continue a policy beyond age 65, the policy will renew in the event certain conditions exist. This is known as conditionally renewable. The correct answer is: Conditionally renewable

Which of the following is not a payment option to an annuity owner?

Single premium, level premium and flexible premium are all payment options for annuities. There is no dual premium option. The correct answer is: Dual premium option

Medicare Part B offers benefits for all of the following, EXCEPT:

Skilled nursing facilities are covered on a limited basis under Medicare Part A. Part B will cover physician services, diagnostic, X-ray and lab and durable medical equipment. The correct answer is: Skilled nursing facilities

A producer gave a prospective client a visual presentation of the principal benefits of an insurance policy and mentioned that it had the usual conditions, but did not include those in the presentation. The producer was engaging in:

Statements are deemed to be misrepresentations if, when taken in the context of the whole presentation, they may tend to mislead or deceive a person. By detailing only the benefits, the producer was not giving a fair representation of the policy. The correct answer is: Misrepresentation

What is a key difference between a stock insurer and a mutual insurer?

Stock insurers are owned by investors (stockholders); mutual insurers are owned by policyholders. The correct answer is: Stock insurers are owned by investors; mutual insurers are owned by policyholders.

Zoe's policy gives the right to sue and try to collect from others. This is called:

Suborgation gives the insurer the right to step in and try to recover from others. The insurer pays the claim then they sue to recover the money they've paid out. This is common in car accidents. The correct answer is: Suborgation

Which of the following is not an issue in which an insurance contract would normally be voided?

Subrogation occurs when the insurer assumes rights of the insured and sues a responsible third party for damages inflicted on the insured. The correct answer is: Subrogation and representations

Tax-sheltered annuities (TSA) provide retirement income for employees who work for:

Tax-sheltered annuities (TSA) are a pension plan available to employees of companies that are qualified as nonprofit by the IRS. The correct answer is: A nonprofit organization

Which of the following statements is not true about non-qualified retirement plans?

Taxes on a non-qualified plan can be deferred by transferring the money received in a lump sum payment into an IRA. The correct answer is: Taxes cannot be deferred on a lump sum payment.

Because it is less expensive, term insurance has which of the following drawbacks?

Term insurance has no living benefits and it is expense if looked at for the long term. The correct answer is: All of the above.

The AD&D (accidental death and dismemberment) rider provides additional benefits if:

The AD&D policy rider covers the loss of a limb, or eyesight due to an accident. The correct answer is: The insured loses the sight in an eye as a result of an accident

Which of the following is not true about the accelerated benefit rider?

The Accelerated benefit rider does not provide a monthly check when the insured becomes disabled. The correct answer is: Provides a monthly check when you become disabled.

The Beauty Shop Cosmetic Company purchases a life insurance policy on Anna, the company's leading salesperson. Which business continuation plan does this company have?

The Beauty Shop Cosmetic Company purchased key person insurance. Anna is a key employee, because she is responsible for much of the company's profitability. The correct answer is: Key person insurance

Who is responsible for supervising insurance fraud and insurance consumer protection in Florida?

The Chief Financial Officer (CFO) is responsible for supervising insurance fraud and insurance consumer protection in Florida. The correct answer is: The Chief Financial Officer

The proper business practices expected of agents are defined in the:

The Code of Ethics defines proper business practices expected of agents. The correct answer is: Code of Ethics

What defines proper business practices expected of agents?

The Code of Ethics defines proper business practices expected of agents. The correct answer is: The Code of Ethics

In most Disability Income policies, the Elimination Period applies:

The Elimination Period is applied to each disability separately and is usually 30 days. The correct answer is: To each disability separately.

What guarantees Jason the right to question the source and validity of consumer information used to rate a policy?

The Fair Credit Reporting Act (Insurance Information and Privacy Protection Act), give him the right to question the source and validity of the information. The correct answer is: Fair Credit Reporting Act

What law requires that an applicant be notified if a health insurance underwriter may request a report from an investigative agency?

The Fair Credit Reporting Act, also known as Insurance Information and Privacy Protection Act, requires that the insurance company inform you that they might order a report. The correct answer is: Fair Credit Reporting Act

Which of the following allows uninsurable individuals to obtain coverage through pool coverage?

The Florida Comprehensive Health Association allows individuals otherwise uninsurable by traditional open market health insurers due to preexisting conditions to receive health insurance coverage through the high risk pool. The correct answer is: Florida Comprehensive Health Association

What act is meant to promote the availability of health insurance coverage to small employers in Florida?

The Florida Employee Health Care Access Act is meant to promote the availability of health insurance coverage to small employers. The correct answer is: Florida Employee Health Care Access Act

The Insurance Department may place on probation, suspend, revoke or refuse to issue or renew an insurance producer license for all of the following reasons, EXCEPT:

The Insurance Department may place on probation, suspend, revoke or refuse to issue or renew an insurance producer license for failing to pay child support, The correct answer is: Failing to pay alimony

What is the main purpose of the MIB?

The Medical Information Bureau is a trade organization that maintains medical information used by life and health insurers. It shares that information with member companies. The correct answer is: The sharing of medical information and data among its member companies.

When can the Office of Insurance Regulation examine the records of an insurer?

The Office of Insurance Regulation and CFO may examine the affairs, transactions, accounts, records, and assets of each authorized insurer and of the attorney in fact of a reciprocal insurer as to its transactions affecting the insurer as often as it deems advisable. The correct answer is: Anytime

How frequently may the Office of Insurance Regulation examine the affairs and transactions of an insurer?

The Office of Insurance Regulation and CFO may examine the affairs, transactions, accounts, records, and assets of each authorized insurer and of the attorney in fact of a reciprocal insurer as to its transactions affecting the insurer as often as it deems advisable. The correct answer is: As often as it deems advisable

How frequently may the CFO examine an insurer?

The Office of Insurance Regulation and CFO may examine the affairs, transactions, accounts, records, and assets of each authorized insurer and of the attorney in fact of a reciprocal insurer as to its transactions affecting the insurer as often as it deems advisable. The correct answer is: As often as necessary

Which of the following best describes the duties of the Office of Insurance Regulation?

The Office of Insurance Regulations primary duty is to regulate insurance activities in Florida. The correct answer is: Regulation of the insurance industry in Florida

Which of the following is an option that would help the Olsens to adequately protect their minor child?

The Olsens could set up a trust to protect their minor child. The correct answer is: They could set up a trust.

The provision that states when both the insured and the beneficiary died in the same accident, it is presumed that the insured survived the beneficiary is called:

The common disaster provision states when both the insured and the beneficiary died in the same accident, it is presumed that the insured survived the beneficiary. The correct answer is: The common disaster provision

An application consists of all of the following, EXCEPT:

The complete application will have three parts. The correct answer is: Part IV, the insurer's report

The policyowner's obligation to pay the premium is the:

The consideration clause states that a policyowner must pay a premium in exchange for the insurer's promise to pay benefits, and the frequent premium payments. The correct answer is: Consideration Clause

As the beneficiary of his dad's life insurance policy, Nick tried to collect benefits when his dad died 21 months after the policy inception. What is the most likely reason that the claim could be denied?

The contestable period is in effect for two years. It is most likely that the insurance company discovered facts were misrepresented when application was made, and denied the claim for that reason. The correct answer is: Nick's dad had failed to divulge a serious medical condition when he applied for the insurance.

Which of the following is not a nonforfeiture option?

The conversion option is not a nonforfeiture option. All of the others are nonforfeiture options. The correct answer is: Conversion option

Bob is leaving his employer for another position. He has a health problem and wishes to continue his life insurance on an individual basis. What should Charles do to continue his coverage?

The conversion process is outlined in the group certificate. It usually requires that the participant notify the company in writing within in a set time frame, usually 31 days from termination. The correct answer is: Bob must make a written request within 31 days and the company will issue the policy outlined in the plan at his current age.

If James has an increasing term policy, which of the following must increase?

The death benefit increases. The correct answer is: The death benefit

An insured has returned to work after a disability, but is unable to perform all of his previous duties. Which of the following definitions would cover his permanent partial disability?

The definition of residual disability would cover this type of disability. The correct answer is: Residual disability

In a life insurance policy, the entire contract clause provides that all statements made by the insured, in the application are:

The entire contract clause provides that statements made by the insured, in the application are considered representations. The correct answer is: Representations

Which clause in a contract prevents the insurance company from modifying a contract after it has been issued?

The entire contract provision prevents the insurance company from modifying the terms of the contract unilaterally. The correct answer is: The entire contract provision

All of the following are life policy dividend options, EXCEPT:

The fixed period option is a settlement option - not a dividend option. The correct answer is: Fixed period option

Which of the following does not have to be included in the outline of coverage?

The following must be contained in the outline of coverage:" A statement identifying the applicable category of coverage afforded by the policy based on the minimum basic standards." A brief description of the principal benefits and coverage provided in the policy." A summary statement of the principal exclusions and limitations or reductions contained in the policy including preexisting conditions, probationary periods, elimination periods, deductibles, coinsurance, and any age limitations or reductions." A summary statement of the renewal and cancellation provisions, including any reservation of the insurer of a right to change premiums. The correct answer is: The fees and costs of the policy

What is the tax liability for taking more than 60 days to transfer funds from one IRA to another qualified plan?

The funds must be deposited within 60 days or incur a 20% tax liability. The correct answer is: 20%

How much time does someone have to transfer funds from one IRA to another without incurring a tax penalty?

The funds must be deposited within 60 days or incur a 20% tax liability. The correct answer is: 60 days

Which of the following factors does not influence the amount that an individual receives as monthly income under Social Security?

The insured's sex does not influence the amount. The correct answer is: Sex

The autopsy provision allows an autopsy on what basis?

The insurer has the right to ask for an autopsy when they suspect foul play or other factors that might affect a claim. The correct answer is: An insurer may do so if it is not forbidden by law and the insurer pays the cost.

An individual has a disability income policy with a Change of Occupation clause when he changes to a new more hazardous job. He neglects to inform the insurer. What happens if one year later he files a claim when he becomes disabled?

The insurer would pay the claim according what the premiums would have purchased had the hazardous occupation been known. The correct answer is: The insurer will pay the claim based on what the premiums would have purchased had the hazardous occupation been known.

If an applicant misstates their age on an insurance application, what does the insurer do when it is discovered at claim time?

The insurer would pay the claim but adjust the benefits (downward) to reflect what he would have been entitled to if his real age had been given. The correct answer is: Adjust the claim benefits to reflect what he would have been entitled to if his real age had been given.

What clause in an insurance contract identifies the contracting parties and the scope and limits of coverage?

The insuring clause is one that sets the basic terms of the contract and prevents any unilateral changes by the insurance company. The correct answer is: Insuring Clause

Which of the following is not a settlement option for a life policy?

The interest only, life income and fixed amount options are all settlement options. The extended term option is an option - not a settlement option. The correct answer is: Extended term option

Which of the following is a characteristic of an interest sensitive whole life policy?

The interest-sensitive whole life policy is a guaranteed fixed premium permanent life insurance policy with a guaranteed minimum cash value. The guaranteed cash value (less any outstanding loan and accrued loan interest) is the minimum the cash value can be. The correct answer is: All of the above

Martha has both Medicare Part A and a group policy to cover her medical costs. When she is injured in an accident at work, which of her policies is considered primary?

The key statement here is 'she is injured in an accident at work'. That means that Workers' Compensation would be the primary - because the injury and expense are work related. The correct answer is: Workers' Compensation

The major benefit of HIPPA is

The main benefit of HIPPA is portability. The correct answer is: Portability

The maximum duration of a long-term disability payment is usually:

The maximum benefit for a group policy is generally age 65 or a specific number of years if the insured is disabled after a specified age. The correct answer is: Age 65 or a specified period of time if the insured is over a specified age when disabled

Len's hospital and surgical expense policy pays $100 daily room and board and $1,000 for ancillary expenses. The surgical expense pays a maximum of $500. Len was hospitalized for 10 days with a $200 room and board charge. His ancillary expenses were $1,500 and his surgeon charged $2,000. How much will the insurance company pay?

The maximum that is paid for hospital is $1,000 ($100 _ 10). Ancillary is also $1,000 maximum and the surgeon is $500 maximum. That adds up to $2,500. The correct answer is: $2,500

How does being a stunt pilot impact a woman's ability to get life insurance?

The most likely outcome of her occupation is that a policy would be written with an aviation exclusion. The correct answer is: A policy could be written with an aviation exclusion.

What is the advantage of a payor benefit rider?

The payor rider provides a temporary waiver of premium. The correct answer is: It provides a temporary waiver of premium if the person paying the premium dies.

Who of the following would NOT be considered a family member?

The phrase "not a family member," with respect to a life agent, means an individual who is not related to the agent as father, mother, son, daughter, brother, sister, grandfather, grandmother, uncle, aunt, first cousin, nephew, niece, husband, wife, father-in-law, mother-in-law, brother-in-law, sister-in-law, stepfather, stepmother, stepson, stepdaughter, stepbrother, stepsister, half brother, or half sister. The correct answer is: Cousin-in-law

When Jack and Jill divorced, the court ordered that Jack name Jill beneficiary of his insurance. He may not change this, even if he remarries unless Jill gives her permission. Jill is:

The policy owner may not change an irrevocable beneficiary without the beneficiary's written consent. The correct answer is: An irrevocable beneficiary

Who has the right to change the beneficiary on a life policy?

The policyowner has the right to change the beneficiary. The correct answer is: The policyowner

Which of the following is not a case in which life insurance proceeds would be included in the deceased's estate?

The proceeds are taxable if the deceased was the policyowner, the deceased's estate was the named beneficiary and / or the deceased transferred the policy to another person within 3 years of his/her death. The correct answer is: The deceased's wife was the beneficiary.

When an insured completed his health policy application, his producer did not take a premium when he submitted it to the insurer. When the producer delivers the policy to the applicant, he needs to do all of the following EXCEPT:

The producer does not need to issue the applicant a conditional receipt when he delivers the policy. The correct answer is: Issue the applicant a conditional receipt.

The producer realizes that the prospective client omitted information about a prior illness. What should the producer do?

The producer has the duty to inform the prospective insured that a claim might be rejected later on with possible repercussions. This is a form of fraud, and a claim might be rejected on this basis. The correct answer is: Tell the prospective client that a claim might be rejected later due to the omission.

When recommending a replacement policy, a producer should remember that:

The producer should be aware that he/she could have liabilities because of errors or omissions made in the replacement process. The correct answer is: He/she has liabilities because of errors or omissions

All of the following are duties of a producer when delivering a policy to an applicant EXCEPT:

The producer should not keep the policy in his office - the client needs to have possession of the policy. The correct answer is: Arranging to keep the policy in his office for safe-keeping.

An insured has received a claim form from the insurance company and has completed the form with proper documentation of the loss. How much time does the insurance company have to pay the claim?

The provision states that all claims for losses will be paid at least monthly. The correct answer is: 30 days

Which of the following is not true about insurable interest?

The purchaser can also be the person insured. The correct answer is: The purchaser cannot also be the person insured.

What Florida statute ensures coverage for employees of small businesses not covered by COBRA 1985?

The purpose of the Florida Health Insurance Coverage Continuation Act (Mini-COBRA) is to ensure coverage for employees of small businesses not covered by COBRA 1985. The correct answer is: Mini-COBRA

The benefit that encourages the disabled policy owner to try to return to work is:

The recurrent disability provision encourages a person with a disability to try and go back to work. It specifies a certain number of days that a recurrence of the disability is considered a continuation, not a new disability. Therefore it does not have a new elimination period. The correct answer is: Recurrent disability

Dylan tells the insurer to keep the dividend and apply it to his next premium. He is using which dividend option?

The reduction of premium dividend option allows the insurer to keep the dividend and apply it to the next premium. Remember dividends are not taxed. The correct answer is: Reduction of premium

The life insurance rider that pays the face amount plus the total premiums paid into the policy is known as:

The return of premium rider pays the total amount of premiums paid into the policy as long as the insured dies within a certain time period specified in the policy. The death benefit is comprised of the face amount plus the total premiums paid into the policy. The correct answer is: Return of premium

Don's life insurance policy was delivered to him on September 10th. In order to get a full premium refund, he must return the policy to his agent no later than:

The specified time for a full refund for a new life policy is at least 10 days. If he returns the policy by September 20th, he will get his refund. The correct answer is: September 20th

The standard nonforfeiture credit for a long-term care policy is what percentage of the sum of all premiums paid?

The standard nonforfeiture credit for a long-term care policy is equal to 100% of the sum of all premiums paid. The correct answer is: 100%

Which of the following is true about the 80/20 coinsurance provision in a major medical policy?

The theory of co-insurance is that insured will not seek the doctor's help each time they have any indication of a health problem. The correct answer is: Co-insurance will help control excess utilization of the policy

Which of the policy provisions refers to pre-existing conditions?

The time limit for certain defenses clause is specifically about pre-existing conditions and how long the company may use this information to deny a claim. The correct answer is: Time limit for certain defenses clause

An incontestable clause in a life insurance plan is comparable to what clause in an accident and health contract?

The time limit for certain defenses is comparable to the incontestable clause in a life contract. The correct answer is: Time limit for certain defenses

Jennifer made an additional premium payment on her Adjustable Life policy. Which of the following is not a way that her policy is affected by this payment?

The value of her nonforfeiture options may increase - but not decrease. The correct answer is: The value of nonforfeiture options may decrease.

Premiums paid for long-term care policies are deductible from income tax under what circumstances?

There are two basic types of plans: qualified and non-qualified. Once a plan is issued as one or the other, it may not be changed. Premiums for long-term care fall under the medical deduction rules. The correct answer is: The plan must be a qualified plan and only a portion of the premiums is deductible.

What steps should 3 equal partners in a company valued at $300,000 do to be prepared in case 1 or more of the partners becomes disabled?

There are two elements to a good buy-out agreement. First, there needs to be a written agreement that is binding on the partners. Second, the agreement should be funded with disability policies to insure the disabled partners receive fair value for his share of the business. The correct answer is: Have their attorney draft a disability buy-out agreement and insure each partner for $100,000 in disability payments to fund the agreement

What is the minimum number of employees that must be insured under contributory employer-sponsored group health insurance plans?

There is no minimum number of employees that must be insured under contributory (employer and employees share in the cost of premiums) employer-sponsored group health insurance plans. The correct answer is: There is no minimum

Which of the following statements is correct when pertaining to coordination of benefits by a group long-term disability plan with Social Security?

They can be integrated when group and Social Security benefits pay a combined maximum limit. The correct answer is: Group and Social Security benefits pay a combined maximum limit.

Which of the following is true about immediate annuities?

They do not have an accumulation period, and payouts must begin within one year of the first premium payment. The correct answer is: They do not have an accumulation period.

Which of the following is not considered "transacting" insurance?

Transacting insurance includes: solicitation or inducement; preliminary negotiations; effectuation of a contract of insurance, and transaction of matters subsequent to effectuation of a contract of insurance (e.g., collecting premiums). The correct answer is: Investigation

Inducing a policyholder to switch insurance companies without regard to bad consequences is:

Twisting is knowingly making misleading representations or incomplete or fraudulent comparisons of insurance policies in order to induce a person to lapse, forfeit, surrender, terminate, retain, assign, or convert a policy in order to sell a policy for another company. The correct answer is: Twisting

Making misleading statements to trick a policyholder into forfeiting a life policy so they will switch insurance companies is:

Twisting is knowingly making misleading representations or incomplete or fraudulent comparisons of insurance policies in order to induce a person to lapse, forfeit, surrender, terminate, retain, assign, or convert a policy in order to sell a policy for another company. The correct answer is: Twisting

People going to a band camp would be covered by a:

Typically participants in a camp, or athletic event are covered by a blanket insurance policy. The correct answer is: Blanket insurance policy

The insurance company can adjust the policy premium and/or the policy benefits under the:

Under the misstatement of age or gender provision, the insurance company could adjust the benefits up or down depending on whether the age was represented higher or lower than the actual age of the insured. The correct answer is: Misstatement of age or gender provision

An insured has submitted notice of loss for a medical bill to the insurance company, which has not responded in a timely fashion. Under these circumstances the insured's best course of action is to:

Under the uniform claims rules, when a company fails to furnish a claim for when they have been notified of a loss, the insured may submit proof of loss in any reasonable form, and the company is bound to accept it. The correct answer is: Submit the proof of loss in any form and the insurance company is required to accept that and consider the claim

In determining the coverage and benefits to pay for a surgery based on what is considered fair and common for an area is using:

Under the usual, reasonable, and customary method, the insurer looks at what is considered reasonable and customary for a geographic area. The correct answer is: Usual, reasonable, and customary

What unfair trade practice uses force to compel a person to purchase an insurance policy?

Using force or compelling a person to purchase an insurance policy is an unfair trade practice. The correct answer is: Coercion

What does "surgery will be reimbursed on a usual and customary basis at the 80th percentile" mean:

Usual, customary and reasonable allows the insurance company to reimburse fees based on where the patient is treated, what is actually performed and base the reimbursement on what peer doctors in the area usually charge for that procedure. The correct answer is: The insurance company will pay a benefit that is equivalent to what 80% of the surgeons in that geographical area charge most of the time for a given procedure.

If the cash values of an annuity are invested in securities, it is a:

Variable annuity The correct answer is: Variable annuity

All of the following are mandatory provisions for health policies, EXCEPT:

Waiver of premium is an optional feature. The correct answer is: Waiver of Premium

Which of the following provisions is one that recognizes rights of ownership in a policy?

When a beneficiary arrangement is present, it is a right of ownership. The correct answer is: Change of beneficiary

Which of the following words can be used in health insurance policy advertisement?

When advertising health insurance policies in Florida, no advertisement may use words or phrases such as _all,_ _full,_ _complete,_ _comprehensive,_ or _unlimited_ in a manner that exaggerates policy benefits. The correct answer is: More

On the death of an insured, settlement of a life insurance policy is made when:

When an insured dies and a claim is submitted, settlement must be made upon receipt of proof of death and surrender of the policy. The correct answer is: Proof of death and surrender of the policy

Suitability information for a prospective client would include all the following, EXCEPT:

When selling an annuity, an agent is required to have a reasonable basis for believing the recommendation is suitable for the consumer based on facts provided by the consumer. The agent must attempt to collect the consumer's suitability information that includes: age, sex, investment objectives, source of funds, annual income, intended use, liquid net worth, liquidity needs, financial situation, financial needs, and risk tolerance. The correct answer is: Race

Because Sylvia paid the initial premium when her policy was delivered, in order for the policy to be in effect, the agent is required to obtain:

When the initial premiums is not paid until policy delivery, the agent needs to obtain a statement of good health, signed by the insured, stating that the insured's health has not changed. The correct answer is: A statement of good health

Under Medicare Part A, a spell of illness begins again and is subject to a new deductible for another admission when:

When there is a separation of at least 60 days between hospital days, a new deductible applies. The correct answer is: The patient has been discharged from a prior stay and 60 days have elapsed

According to the Physical Examination and Autopsy provision, who is responsible for paying the cost of examining the insured?

Where not prohibited by law, the insurer may request that a physical examination or autopsy of the insured be performed while a claim is pending. The cost of such procedure is the insurer's responsibility. The correct answer is: The insurer

Where replacement is involved, what else must an agent give the insurer with an application for life insurance?

Where replacement is involved, an agent must give the insurer with an application for life insurance a copy of the Notice to Applicant Regarding Replacement of Life Insurance and a copy of all sales proposals used for the presentation to the applicant. The correct answer is: Notice to Applicant Regarding Replacement of Life Insurance and a copy of all sales proposals

Where replacement is involved, it is the duty of the replacing insurance company to maintain all related records for at least:

Where replacement is involved, the replacing insurance company must maintain copies of the Notices to Applicant Regarding Replacement of Life Insurance, Comparative Information Forms, and all sales materials for at least 3 years or until the next examination, whichever is later. The correct answer is: 3 years

Where replacement is involved, what must the replacing insurance company provide to the applicant of a policy that does not contain an unconditional refund provision prior to accepting the applicant's initial premium?

Where replacement is involved, the replacing insurance company must provide a Buyer's Guide and a Policy Summary prior to accepting the applicant's initial premium if the policy does not contain an unconditional refund provision. The correct answer is: Buyer's Guide and Policy Summary

Where replacement is involved, when must the replacing insurance company provide a Buyer's Guide to the applicant of a policy that contains an unconditional refund provision?

Where replacement is involved, the replacing insurance company must provide a Buyer's Guide and a Policy Summary prior to or with policy delivery if the policy contains an unconditional refund provision for a period of at least 10 days. The correct answer is: With the policy delivery

When must an insurance agent give an applicant a copy of all sales proposals for a presentation involving replacement?

Where replacement is or may be involved, the agent will leave with the applicant the original or a copy of all sales proposals used for presentation to the applicant. The correct answer is: After to the presentation

How is the grace period in a health policy generally determined?

While the general grace period for policies is 31 days, the grace period may be shorter if the premium frequency is less than monthly. A weekly premium has a grace period of 7 days, etc. The correct answer is: By the premium mode

An exclusion that always appears in a health policy is:

While there may be some other exclusion, losses incurred while in the act of committing a felony is always an exclusion. The correct answer is: Injury in the act of committing a felony

All of the following are true about group health policies, EXCEPT:

With a group contract, the policyholder is the employer, union, or association that contracts with the insurer for the coverage. The correct answer is: The policyholder is the employee.

Which of the following is not an accurate comparison of group and individual plans?

With an individual disability policy, virtually all accidents are covered. With a group disability policy, generally only accidents that happen when the insured is NOT on the job are covered. The correct answer is: Individual - all accidents are covered, Group - no accidents are covered

With the exception of nonpayment of premium, a group life insurance policy is incontestable after:

With the exception of nonpayment of premium, a group life insurance policy is incontestable after 2 years. The correct answer is: 2 years

Does a loan on the cash value of a life insurance policy accrue interest, and if so, how is the interest handled?

Yes, the loan does accrue interest. The interest can be paid annually, or added to the loan. The correct answer is: Yes, the interest can be paid annually, or added to the loan.

A Medicare supplement insurer cannot deny an application for a Medicare supplement policy if the applicant is both 65 and enrolled in:

A Medicare supplement insurer cannot deny an application for a Medicare supplement policy if the applicant is both 65 and enrolled in Medicare Part B. The correct answer is: Medicare Part B

What type of care is nursing care and rehabilitation needed on a daily basis that is performed by a medical professional under a physician's orders?

Skilled care is nursing care and rehabilitation needed on a daily basis, performed by a medical professional under a physician's orders. The correct answer is: Skilled care

What is the waiting period under the waiver of premium rider before the first premium will be waived?

There is usually a waiting period of 3 or 6 months once the policy owner becomes disabled before the first premium will be waived. The waiver would then continue for the duration of the disability. The correct answer is: 3 or 6 months

Which of the following is not an advantage of a survivorship policy?

They are not limited to term life policies. The correct answer is: They are limited to term life policies.

Who must sign the Notice Regarding Replacement of Accident and Sickness or Long-term Care Coverage?

A Notice Regarding Replacement of Accident and Sickness or Long-term Care Coverage must be signed by the applicant. The correct answer is: The applicant only

All of the following provisions are mandatory under the uniform NAIC law, EXCEPT:

Co-insurance is a benefit design feature. The correct answer is: Coinsurance Provision

Appropriately addressing an applicant's financial objectives is known as determining:

Insurers must determine the suitability of annuity products for applicants by establishing standards and procedures for making recommendations that appropriately address the applicant's financial objectives. The correct answer is: Suitability

What is a managed-care arrangement under which a selected group of independent hospitals and medical practitioners in an area agrees to provide a range of services at a prearranged cost?

A PPO is a managed-care arrangement under which a selected group of independent hospitals and medical practitioners in an area, such as a state, agrees to provide a range of services at a prearranged cost. The correct answer is: PPO

What type of insurer is formed under the laws of Florida?

A domestic insurer is one formed under the laws of this state, Florida. The correct answer is: Domestic

What can Isabelle do to increase her coverage on a predetermined schedule without further evidence of insurability?

A guaranteed insurability option will allow Isabelle to increase her coverage on a predetermined schedule without further evidence of insurability. The correct answer is: Add a guaranteed insurability option

What type of health insurance policy states that the insurance company may not cancel the policy, but they may increase the rates on a specified class of insureds?

A guaranteed renewable policy allows the insurance company to increase rates on the policy anniversary, but it may not cancel the policy. The correct answer is: Guaranteed renewable policy

What rider can decrease the death benefit when utilized?

A long-term care rider normally allows the policyholder to utilize some or all of the policy's specified amount, or death benefit, for long-term care costs, either for a period of time or until the available coverage amount has been exhausted, under stated terms. The long-term care rider can reduce the death benefit if the decrease is incorporated into a life insurance policy. The correct answer is: Long-term care rider

All of the following are true about a Medical Expense policy, EXCEPT:

A medical expense policy is a reimbursement policy that will pay based on a pre-set schedule of benefits. It is not restricted to groups. The correct answer is: Available on a group basis only

Which of the following is NOT a right of the owner of a life insurance policy?

A policy owner cannot change an irrevocable beneficiary without the consent of the beneficiary. No verbal changes are allowed. A policy owner cannot borrow from the policy if there is no cash value. The correct answer is: All of the above

What is the free look period for a Medicare supplement policy?

A policyholder has the right to return a Medicare supplement policy within 30 days of its delivery. The correct answer is: 30 days

Riders and endorsements can be used to accomplish any of the following, EXCEPT:

A rider or endorsement may be used to change the benefits or premiums, but it may not be used to alter one of the core provisions of the contract. The correct answer is: Modify the time limit for certain defense clause

The fact that an insurance agent cannot commingle their insurance funds with their personal funds is referred to in legal terms as:

All premiums belonging to insurers or others received by an agent are trust funds received by the licensee in a fiduciary capacity. An agent must keep the funds belonging to each insurer for which an agent is not appointed in a separate account so as to allow the department or office to properly audit such funds. Agents must not use such funds for their own purposes. The correct answer is: Fiduciary responsibility

Which of the following is not a standard claim procedure?

No legal action can be taken prior to 60 days after proof of claims has been provided to the insurer. The correct answer is: No legal action can be taken prior to 120 days after proof of claims has been provided to the insurer

In Florida, which of the following is NOT a type of "agent"?

An agent is a general lines agent, life agent, health agent, or title agent. The correct answer is: Annuity agent

An annual maximum benefit will provide the following:

An annual maximum may be applied to specific benefit or to an entire policy. The correct answer is: No specified life time amount, but a limited benefit for each year

An individual annuity may serve any of the following purposes, EXCEPT:

An annuity product would be appropriate for all of the above except funding short term needs. The correct answer is: Short term savings account

When does an applicant have the right to designate a second addressee?

An applicant for has a right to designate a second addressee at the time of the policy application or at any time the policy is in force. The correct answer is: At the time of the policy application or at any time the policy is in force

What must an insurer have to be an authorized insurer?

An authorized insurer is one duly authorized by holding a certificate of authority issued by the Office of Insurance Regulation to transact insurance in Florida. An unauthorized insurer does not have a certificate of authority, and includes excess and surplus lines insurers. The correct answer is: A certificate of authority

What must an insurance agent provide to the applicant of a life insurance policy that does not contain an unconditional refund provision prior to accepting the applicant's initial premium?

An insurance agent must provide a Buyer's Guide and a Policy Summary prior to accepting the applicant's initial premium if the policy does not contain an unconditional refund provision. The correct answer is: Buyer's Guide and Policy Summary

A one-sided agreement whereby a promise to do (or refrain from doing) something in return for a performance (not a promise) is what type of contract?

An insurance contract is a good example of a unilateral contract, especially a life insurance contract. The correct answer is: A unilateral contract

When must an outline of coverage be given to a prospective applicant for long-term care insurance?

An outline of coverage must be given to a prospective applicant for long-term care insurance at the time of initial solicitation. The correct answer is: At the time of solicitation

A person insured under a group life insurance policy may make an assignment of all of the following, EXCEPT:

Any person insured under a group life insurance policy may make an assignment of all or any part of his incidents of ownership under such policy including: conversion, the right to name a beneficiary, assign policy proceeds. All incidents of ownership may be assigned, without prejudice to the insurer on account of any payment it may make or individual policy it may issue. The correct answer is: Insured

The Fair Credit Reporting Act states that generally, consumer reports cannot contain the following information, EXCEPT:

Consumer reports are reports about the characteristics of an individual, including the individual's general character and reputation, employment history, living arrangements, and credit worthiness. The correct answer is: An individual's character

What places offer mature adults the ability to _age in place_ without ever needing to move for health reasons?

Continuing Care Retirement Communities (CCRCs) offer mature adults the ability to _age in place_ without ever needing to move for health reasons. While traditional retirement communities only offer independent living and assisted living, CCRCs provide a continuum of care that includes independent and assisted living to memory care and skilled nursing. The correct answer is: Continuing Care Retirement Communities

"Take it or leave it" is the basis for insurance policies. Because of this, they are referred to as:

Contracts of Adhesion are "take it or leave it". The correct answer is: Contracts of Adhesion

All of the following out of pocket expenses qualify for a medical deduction, EXCEPT:

Disability benefits are not eligible for deduction, since the income received will be tax-free. The correct answer is: Disability insurance premium

If the total of a taxpayer's medical expense exceeds 10% of their adjusted gross income, all of the following can be deducted, EXCEPT:

Disability premiums are not deductible. The correct answer is: Disability insurance premiums

Which of the following would NOT be considered unfair discrimination?

Discrimination is a necessary part of insurance, including occupation, hobbies, and expectation of life. It is an unfair trade practice to discriminate against individuals of the same class and equal expectation of life in the rates, terms, conditions, benefits, or any policy provision for insurance. It is illegal to discriminate based on sex, race, national origin, or blindness. The correct answer is: Discrimination based on occupation

What organization did Florida create to improve access to health insurance for uninsured children in Florida?

Florida created the Florida Healthy Kids Corporation to improve access to health insurance for uninsured children in Florida. The correct answer is: Florida Healthy Kids Corporation

Florida insurance laws are administered by all the following, EXCEPT:

Florida insurance laws are administered by the Chief Financial Officer (CFO), the Commissioner of the Office of Insurance Regulation and the Financial Services Commission. The Florida legislature creates the insurance laws, but is not responsible for administration. The correct answer is: The Florida legislature

Florida's Long-term Care Partnership Program is a partnership between Medicaid and:

Florida's Long-term Care Partnership Program is a partnership between Medicaid and private long-term care insurers designed to encourage individuals to purchase private LTC insurance. The correct answer is: Private long-term care insurers

Which of the following is not a characteristic of a group life insurance plan?

Group life insurance is available at lower rates than individual insurance because the administrative, operational and selling costs associated with group life insurance are less than those of individual plans. These savings are passed on to group policyholders in the form of lower premiums. The correct answer is: Individual selection of benefits

Which of the following is intended to be covered by health insurance?

Health insurance is intended to insure the risk of income loss caused by accidental injury or illness and associated medical costs. The correct answer is: All of the above

If a person is covered by 2 health policies, one as an employee and one as a dependent, which policy pays first when there is a claim?

If a person is covered by 2 health policies, one as an employee and one as a dependent, the benefits are determined first by the policy as an employee, then the benefits of the plan as a dependent. The correct answer is: The policy as an employee

All of the following are true concerning taxation of medical benefits, EXCEPT:

If a taxpayer uses medical expenses for this deduction and is later reimbursed for those expenses by insurance, he/she is required to report that as income. The correct answer is: Medical expenses deducted from income tax become taxable in the next year if they are reimbursed after the deduction is taken.

How much time before coverage is in effect for a Medicare supplemental policy that replaces another Medicare supplemental policy that was held for 1 year?

If the policy is replacing a policy that has been in effect for more than 6 months, there is no probationary or waiting period. It is effective immediately. The correct answer is: Immediately

In Florida, what is the minimum number of employees to be considered a "small employer?"

In Florida, a "small employer" has at least 1 and not more than 50 employees. The correct answer is: 1

In Florida, all small employer health plans must be:

In Florida, all small employer health plans must be guaranteed issue to every small employer with 2 to 50 employees. The correct answer is: Guaranteed issue

In a group health insurance contract, the individual insureds are each given:

In a group health insurance contract, the contract for coverage is between the insurance company and the employer, and a master policy is issued to the employer. The individual insureds covered by the policy are not given separate policies; instead, they receive a certificate of insurance and an outline describing the policy benefits. The correct answer is: A Certificate of Insurance

Individual and group health policies must provide coverage for newborn children of a family member from the moment of birth for at least:

Individual and group health insurance policies that provide coverage for a family member of the insured must also provide coverage for the insured's newborn children from the moment of birth. Coverage must be also be provided for the newborn child of a covered family member (such as the newborn of a daughter) for 18 months after the birth of the newborn child. The correct answer is: 18 months

What requires that an individual have a valid concern for the continuation of the life or well being of the person insured?

Insurable interest requires that an individual have a valid concern for the continuation of the life or well being of the person insured. The correct answer is: Insurable interest

Insurance advertisements may not refer to premiums as:

Insurance advertisements may not refer to premiums as deposits. The correct answer is: Deposits

The clause that prevents an insurer from denying a claim, except for nonpayment of premiums, after the policy has been in force for over 2 years is called the:

It is the incontestability clause that prevents an insurer from denying a claim, EXCEPT for nonpayment of premiums, after the policy has been in force for over 2 years. The correct answer is: Incontestability clause

Who sells the Small Business Health Plan insurance?

It is the intent of the Legislature to create the Small Business Health Plan to provide small employers the option and ability to provide health care benefits to their employees at an affordable cost. Insurers transacting this coverage must be chosen by the Office of Insurance Regulation. The correct answer is: Only Florida insurers chosen by the Office of Insurance Regulation

How many hours of continuing education are required every 2 years for Florida life and health agents?

Life and health agents must complete 24 hours of continuing education every 2 years. The correct answer is: 24 hours

All of the following are required provisions for health policies, EXCEPT:

Listing exclusion is common practice, but it is not necessarily a standard provision. The correct answer is: Exclusions

All of the following are elements of insurable risks, EXCEPT:

Losses must not be catastrophic risking insurer insolvency. The correct answer is: Loss must be catastrophic

Marilyn's husband was mowing the yard, and a rock hit her in the eye causing her to lose sight in that eye. Her husband tried to stop the lawnmower and lost a finger. Marilyn has a family accidental death and dismemberment policy through her employer. What benefits will be paid as a result of these accidents?

Marilyn is the only one who qualifies for benefits under an accidental death and dismemberment policy. Benefits are payable for the loss of a limb (hand, leg, arm, foot) and loss of an eye. The correct answer is: Marilyn will receive a benefit for the loss of an eye.

Mark names his wife and children as beneficiaries on his life policy. They would not be considered:

Mark's wife and children could be primary, contingent or irrevocable beneficiaries. The correct answer is: Other insureds

Medicaid will provide all of the following except

Medicaid will provide medical services only. It is not designed to provide supplementary income to the recipient or any benefit outside needed health care. The correct answer is: Monthly Income

After Michelle filed her income taxes, she received a check from the insurance company that reimbursed her for some of the expenses she deducted. What is the tax situation for these benefits?

Michelle had taken a deduction for medical expenses for which she was later reimbursed. She will be required to file an amended return to reflect this reimbursement. The correct answer is: Michelle should file an amended return, since reimbursed medical expenses do not count toward the 10% threshold.

Which of the following statements is true about conditions to reinstate a lapsed life insurance policy?

Most states allow reinstatement up to 3 years after the lapse of a policy. The correct answer is: The policy has been expired no more than 3 years

What riders provide for payment of double or triple the accidental death or dismemberment benefits based on the cause of death or specific type of dismemberment?

Multiple indemnity riders are riders that provide for payment of double or triple the accidental death or dismemberment benefits based on the cause of death or specific type of dismemberment. The correct answer is: Multiple indemnity rider

In what type of health insurance contract are the premiums guaranteed not to increase and the insurance company may not cancel the policy?

Non-cancellable is the only policy that guarantees premiums and forbids cancellation by the insurance company. The correct answer is: Non-Cancellable

If an insured has a claim when he discovers that his age was misstated on the policy application, what will be the probable action of the insurance company?

One of the standard policy provisions is a misstatement of age provision. This allows the insurance company to adjust a claim to reflect the correct age without further action. The correct answer is: The claim will be adjusted to reflect the correct age.

A surgeon who has a neurological problem in his arm is not able to perform surgery, but you can practice internal medicine. His disability policy states that he will qualify for benefits if he is unable to perform the essential duties of his occupation as a result of a sickness or an accident for 5 years and any occupation for which he have had prior experience, education or training thereafter. What benefits might he expect from this policy?

Own occupation lasts for 5 years, during which he will receive full benefits. The correct answer is: Full benefits for 5 years and no benefits thereafter

What is contained on Part III of an application for health insurance?

Part III is the agent's report, where the agent completes some background information on himself and the applicant. The correct answer is: Agent's report

Which of the following is an effective and legal way to deliver a policy?

Personal delivery by the agent or producer is usually preferred, but mailing the policy is legal, as is turning the policy over to someone authorized to act on the policyowner's behalf. The correct answer is: All of the above

Any of the following should be considered in a needs approach calculation, EXCEPT:

Providing income and funds to meet lump sum obligations is the primary focus of needs planning. The correct answer is: Amount needed to retire comfortably

Short-term disability plans may be designed with any of the following features, EXCEPT:

Short-term disability usually does not cover on the job losses. It does not coordinate with Workers' Compensation, since it is not a covered loss. The correct answer is: Benefits will coordinate with Workers' Compensation.

What would be best for someone who received a large lump sum from their company retirement and wants to be sure their basic living needs are always covered?

Someone should buy a single premium deferred annuity that will produce enough income to cover their basic expenses. The correct answer is: An immediate annuity purchased with a lump sum

Term insurance provides:

Term insurance provides pure protection and it is the least expensive form of insurance. The correct answer is: Pure protection and is the least expensive form of insurance

What defines proper business practices expected of agents?

The Code of Ethics defines proper business practices expected of agents. The correct answer is: The Florida Code of Ethics

Who of the following is NOT on the Financial Services Commission?

The Financial Services Commission includes the governor of Florida, the CFO, the attorney general and the Commissioner of Agriculture. The correct answer is: The Florida Commissioner of Insurance

The Insurance Department may place on probation, suspend, revoke or refuse to issue or renew an insurance producer license for which of the following reasons?

The Insurance Department may place on probation, suspend, revoke or refuse to issue or renew an insurance producer license for failing to pay child support. The correct answer is: Failing to pay child support

All of the following are common methods to obtain medical information, EXCEPT:

The Medical Information Bureau (MIB), an exam by a doctor and lab work are all consistent with methods used by insurers to gather medical information. The correct answer is: A consumer credit report

Which of the following is not necessary for a policy to take effect?

The applicant reviewing the policy is not a necessary step for a policy to take effect. The policy can take effect when it is issued by the insurer, delivered and the first premium collected. The correct answer is: The policy was reviewed by the applicant

At what point will the APL (automatic premium loan) provision on a life policy no longer pay premiums?

The automatic premium loan allows the insurer to tap into the cash value of a policy to pay an overdue premium. The correct answer is: It will pay until there is no longer cash value to cover the premium

Thomas submitted an application for health insurance with the full first premium and was issued a conditional receipt. On which provision of the contract is the application and premium payment based?

The insured's consideration is the completed application and the initial premium. The correct answer is: The consideration clause

Statements made in an insurance application are held to a principle of:

The insured's statements on an application are considered representations, i.e. they are not guaranteed to be true. The correct answer is: Representation

The insuring clause on the face of a life insurance policy contains all the following, EXCEPT:

The insuring clause of a policy contains the amount of the coverage, the name of the insurance company, the name of the insured, but does not contain the name of the beneficiary to the policy. The correct answer is: Name of the beneficiary

In Florida, what is the minimum age to become licensed as an insurance producer?

The minimum age to become licensed as an insurance producer in Florida is 18. The correct answer is: 18

Which clause in a policy contains information on the parameters to pay claims in the event of a loss?

The payment of claims clause should address the claims process and define who will be paid and on what basis. The correct answer is: Payment of claims

The Entire Contract Provision' states:

The policy along with all the attachments constitutes the entire contract. The correct answer is: The policy along with all attached riders and endorsements and other papers constitutes the entire contract between the policyholder and the company.

When does an agent have to inform a proposed insured that a credit report may be pulled?

The proposed insured must be informed that a report may be requested at the time of application. The correct answer is: The proposed insured should be informed at the time of application.

What is the purpose of the Florida Life and Health Guaranty Association?

The purpose of the Florida Life and Health Guaranty Association is protect policy owners, insureds, beneficiaries, annuitants, payees, and assignees of life and health insurance contracts against the failure of an insurer issuing such policies or contracts to perform its contractual obligations due to its impairment or insolvency. The correct answer is: To protect policy holders and insureds from insurers who cannot fulfill their financial obligations

Does an employee retain any ownership rights under a group contract?

The right to change a beneficiary and certain assignment rights are considered rights of ownership. The correct answer is: Yes, the employee may change a beneficiary and convert to an individual policy.

What is the minimum free look period for life insurance policies in Florida?

The unconditional refund time (free look period) for life insurance policies in Florida is at least 14 days. The correct answer is: 14 days

How much time does an individual have to convert to a new individual life policy after they are terminated from employment covered by a group life policy?

Under a group life policy, if a member's coverage is terminated, the member and dependents may convert their group coverage to individual life coverage. The individual must apply for individual coverage within 31 days after the date of their coverage termination. The correct answer is: 31 days

Upon the death of an insured, life insurance policy proceeds are designated for:

Upon the death of an insured, life insurance policy proceeds are exclusively for the benefit of the person designated as beneficiary. The correct answer is: The beneficiary only

Max and Janet were killed simultaneously. Max had a life policy with Janet as the primary beneficiary. How will the proceeds from the policy be disbursed?

When the insured and the primary beneficiary die at the same time, the proceeds are paid to the contingent beneficiary. The correct answer is: The proceeds were disbursed to the contingent beneficiary.

All of the following may be considered risk factors for a health insurance policy, EXCEPT:

Where a person lives is not a factor usually considered in judging a health risk. The correct answer is: Geographic location

The grace period in a health insurance plan is based on which of the following?

While a standard grace period may be 31 days, the premium mode may be less than monthly and that determines how long the grace period will last. The correct answer is: The premium mode