Chapter exam laws and rules(life ins)
In Florida agents are allowed to engage in rebating if
offered to all insureds in the same actuarial class
Advertising gifts not to exceed ___ are allowed to be given by an agent to a prospective client.
$25
A life policy loan in Florida cannot charge a fixed rate of interest higher than
10%
What percentage of eligible persons must a policy cover in a noncontributory group
100%
The minimum age at which a person can sign a life insurance application is
15 years
In Florida, most life insurance policies have a contestability period of
2 years
In what year was the Florida office of financial regulation OF are created
2003
Agents that have been license for less than six years must complete ___ hours of continuing education every two years.
24 hours
How many hours of continuing education was a newly licensed agent complete every two years
24 hours
A life insurance policies grace period entitles the insured a period of no less than ___ days to make the premium payment.
30
Within how many days must a licensee Notify the department of financial services of a change in address
30 days
A group plan was recently terminated. In Florida, how many days are covered individuals guaranteed coverage after a group plan's termination?
31 days
A licensed agent must be appointed by an insurance company to solicit insurance in Florida. The agent's license will terminate if a certain period of time elapses without being appointed. How long is this period of time?
48 months
Florida requires that an insurance agent must complete __ hours of continuing education on the subject of law and ethics every two years.
5 hours
In Florida what is the maximum percentage of controlled business and Agent may produce
50%
According to Florida law and additional laps notice must be issued after the standard grace period has been expired for policy owners age
64 years or older
In Florida and issuer license to conduct business in Florida but domiciled in New Jersey is called
A foreign company
Which of the following is the best description of 'insure'?
A person corporation association or society that writes insurance contracts
What is Florida's definition of life insurance replacement
A transaction in which a new policy is Bottineau policies terminated
Which of the following is not required on every insurance application sold in Florida?
Address and phone number of the agent
Which of the following employer task does a professional employer organization normally handle?
Administration task
Insurance companies that are organized and countries outside of the United States are referred to
Alien
Which of the following is considered to be misrepresentation?
An agent guaranteeing a policy's dividends
Rebating is an unfair trade practice and is regulated by law. All of the following would be considered to be rebating EXCEPT
An agent misrepresents policy benefits to convince a policyowner to replace policies.
All of the following entities are classified under the four principal areas of Florida life insurance law except
An agents commission
Which of the following situations does not apply to Florida replacement rule
An existing policyholder purchases an additional policy from the same insurer
An example of false advertising would be
An insurer exaggerating its dividends in a magazine advertisement
Which of the following acts is an agent Not authorized to do on behalf of the insure
Authorize claim payments
All the following are nonforfeiture options except
Automatic Premium Loan Option
Which of the following can an agent provide to help a prospective client understand and purchase the most appropriate product
Buyer's Guide
The Bureau of Unclaimed Property is overseen by the
Chief Financial Officer
___ can be defined as "using the contract values of an existing policy to purchase a new policy with an existing insurer".
Churning
One definition of replacement is the active replacing an existing insurance policy with another. Replacement is
Closely regulated and requires full disclosure
Which of the following is an example of unfair trade practice
Coercion
The policy summary contain specific information on all of the following except
Commissions
An applicant who pays the initial premium at the time of application is typically given a(n)
Conditional receipt
All the following are eligibility Requirements for an association Group except
Contributory plans require a minimum of 25 participants
Florida's 14 day free look period for life insurance policy begins at
Date of delivery
In Florida, which agency is responsible for the rehabilitation or liquidation of insurers?
Department of Financial Services (DFS)
Which two entities regulate variable annuities?
Department of Financial Services; and Securities Exchange Commission
Any violations of the Florida financial institutions code may be investigated by
Department of financial services DFS
An example of an unfair claim practice would be
Failing to effectuate prompt, fair, and equitable settlements of a claim
T is an agent and when hired, is reminded that he has a responsibility to handle clients' funds in an honest and ethical manner. This responsibility is referred to as
Fiduciary responsibility
Which organization was established to provide funds to protect and insured in the event of an insurer's insolvency?
Florida insurance guaranty fund association
In Florida, when agents recommend changes be made for existing coverage, the agent must follow establish procedures. The name of this rule is called
Florida replacement rule
Nonprofit life insurance providers that are covered by a special section in the Florida insurance code are called
Fraternal life insurance organizations
Which of the following employees may not be excluded from a group life plan
Full-time employees after the probationary period
What would be an accurate definition of controlled business
Insurance business that is written on the agent's own life, property, or interests
Which of the following situations are not subject to Florida life insurance laws
Insurance companies' day-to-day operations
According to Florida law which of the following statements accurately describes an admitted mail order insurance company
It may solicit insurance business by mail without the assistance of a licensed agent
Who is a mutual insurance company owned by?
Its policyholders
If an agent would like to sell variable annuities which state examination must the agent pass?
Life and Variable contracts
What is the main reason for regulating insurance industry
Maintain the solvency of insurance companies
Convincing a prospective insured to buy an insurance policy based on exaggeration is called
Misrepresentation
During the course of an insurance transaction, if an agent makes a false or incomplete statement, he/she could be found guilty of
Misrepresentation
Which Unfair Trade Practice involves making a false statement on an insurance application in order to receive money from an insurer?
Misrepresentation
Which unfair trade practice involves an agent suggesting that an insurance policy is like a share of stock?
Misrepresentation
Which unfair trade practice involves an agent telling a prospective client that a policy's dividends are guaranteed?
Misrepresentation
What are adjustable rate for life policy loans in Florida based on
Moody's corporate bond index
Which type of insurance company allows their policy owners to elect the governing body
Mutual
Which of the following is not an unfair claims settlement practices
Needing written documentation of claim details
Under which circumstances me a licensed agent in Florida represent an unauthorized entity
Never
According to Florida law a group life insurance policy requires a minimum of how many insurance
No minimum***
Which of the following documents must an agent submit to the replacing insurance company during the replacement of an existing life insurance policy
Notice to existing and replacing insurers of intention to replace
Which entity approves the insurance policy forms used in Florida? ***
Office of Insurance Regulation (OIR) ***
A life insurance policyowner would like to file a complaint against a life insurance agent. In Florida the entity that oversees complaints is called the
Office of financial regulation
Under Florida law a variable annuity policy owner must be notified of the accumulated value of the contract
Once each year
How can an agent-in-charge have more than one location?
Only if the agent-in-charge is present when insurance activity occurs
K is an agent who made an improper sale of an annuity to a client. Which of the following corrective actions would the Department of Financial Services likely order K to take?
Pay monetary restitution to the client
Which of the following types of insureds our life insurance companies allowed to make policy rate discrimination against
People that smoke
Which action could result in a hearing being ordered by the department of financial services?
Performing insurance transactions without a license
According to Florida's life insurance replacement laws a policy owner must be provided with a written comparison and summary statement when it is requested by
Policyowner
What is the purpose of the insurance guaranty fund association
Protects policyowners against insolvent insurance companies
Which of these is not a legal entity for selling life insurance in Florida?
Risk management advisers
Which of the following is not considered rebating?
Sharing commission with an agent licensed in the same line of business
A mutual insurance company in stock insurance company have one main difference between them what is the major contrast
Stock company is owned by its shareholders. Mutual company is owned by its policyholders.
Which of the following factors is not considered when the department of financial services determines if an agents home is an insurance agency?
The amount of premium collected at this location
If a policy owner does not pay the premium by the due date, the
The policy owner can make the premium payment during the grace period
W gave W's age as 50 when W purchased a Life policy. At the time of W's death seven years later, the company discovered W's true age at issue had been 59. What would the normal procedure be under the misstatement of age provision in regard to the payment of the death claim?
The proceeds would be reduced based on whatever the premium would have been if purchased at age 59
In order for a domestic, foreign, or alien insurance company to conduct business, it must be authorized by whom?
The state where they are conducting business
consequence's for placing business with an unauthorized issuer
Third-degree felony, insurance license revoked, responsible for unpaid claims
An example of an unfair claims settlement practices is
Turning down a claim without providing the basis of denial
Which of the following is considered an accurate statement of an unfair trade practice
Twisting involves an agent using misrepresentation to convince a policyowner to cancel their current policy so that they can purchase a new life insurance policy with another company
An insurance company can contest a life insurance contract due to an application fraud within
Two years
An agent that sells ___ Life insurance must be registered with the financial industry regulatory authority
Variable
A life insurance policy owner may sell their policy to a(n) ___ in order to receive a percentage of the policies face value?
Viatical settlement provider
In agents license can be suspended or revoked by
Writing primary control business
The insurer must provide a prospective buyer with a(n)
a Buyer's Guide and Policy Summary
In Florida, deceptive advertising is considered to be
a form of misrepresentation
All the following will result in the suspension of an agents license except
acting with fiduciary responsibility
What type of insurance company is domiciled in England but conducts business in Florida
alien
An example of an unfair trade practice is
an agent making a material misrepresentation to the insured
A variable life insurance agent must be licensed and appointed as a life and variable contract agent, as well as a(n)
broker-dealer
An individual covered under a group life insurance policy is considered to be a(n)
certificate holder
K is insured under a Group Life Insurance policy. K is considered to be a(n)
certificate holder
As a condition for a loan, a bank requires the borrower to purchase credit insurance from a specific company. What is the bank guilty of?
coercion
Which of the following areas of state regulation is not protected by the savings clause in ERISA?
commerce ***
The insurance guaranty fund association is
funded by admitted insurance companies through assessments **
A foreign insurance company doing business in Florida
is a company that was formed under the laws of another state
A license may be denied, suspended, or revoked if the licensee
is found guilty of misrepresentation
Stock Insurance Company
is owned exclusively by its shareholders
An example of unfair discrimination would be
offering different terms of coverage for different policyowners having the same risk classification
All of these are a prerequisite for becoming a licensed agent except
to graduate from high school
An agent who makes misleading statements that lead to the termination of an existing insurance policy so that a new policy with another insurer can be taken out has committed
twisting ***
Which of the following is standard provision of the conversion privileges in a group life policy?
Group Life coverage can be converted to an individual policy at regular rates on an attained-age basis
According to Florida law, which of the following information does not need to be obtained by an agent recommending an annuity purchase?
marital status
Who does an agent represent during the solicitation of insurance
insurance company
How many days does an insurance company have to reject a reinstatement application before it is automatically reinstated?
45
According to Florida's rules on disclosure, a life insurance applicant is expected to be provided with
A buyers guide and policy summary
J owns a business and has a Group Life policy covering her employees. J decides to cancel the policy by letting it lapse on the renewal date. What action must be taken?
All of the employees must be notified of the cancellation either by the insurance company or through J
The department may request all of these during the licensing application process except *
Drug test *
In Florida, which employees eligible for an employer's group term life plan?
Employee who works more than 40 hours per week
The act of an insurance company publishing misleading information about its policies provisions is called
False advertising
Which of the following is not a consequence for placing business with an unauthorized insurer?
First degree misdemeanor
Which of the following professional organizations has its code of ethics incorporated into Florida law *
National Association of Insurance and Financial Advisors (NAIFA) *
A stock life insurance company that issues both participating and nonparticipating policies is doing business on
a mixed plan
An example of sliding would be
charging for an additional product without the applicant's consent
In Florida, which of the following is considered an Unfair Trade Practice?
coercion
J is an agent who recently told a claimant that his rights might be impaired if he does not complete a release form within a specified time. What could this agent be found guilty of?
coercion
Which of the following unfair trade practices involves an agent who makes malicious statements about another persons financial condition?
defamation
An insurance company incorporated under the laws of the state in which its home office is located is called a(n) ___ company
domestic
In Florida, an insurer domiciled and incorporated in this state is called a(n)
domestic company
Financial services commission may hold hearings
for any reason deemed necessary
During the application process the agents primary responsibility is to
insurance company
In Florida, an element of an insurance transaction would be
issuing an insurance contract
Defamation occurs when an agent makes a false statement intended to
malign another insurer
An example of rebating would be
offering a client something of value not stated in the contract in exchange for their business
Under a life insurance policy the ___ has the authority to name the beneficiary?
owner
According to Florida law, group life insurance conversion privileges must NOT
require evidence of insurability
When replacing or exchanging an annuity, the agent must disclose to the annuitant
the possible tax ramifications as a result of the transaction
Group life policies in Florida are required to contain a conversion privilege that allows for conversion
to an individual policy for a stated period of time
T is an employee covered under a Group Life policy. If T's employment is terminated, the conversion privilege gives T the right to convert
to an individual policy upon employment termination
J is an agent who has induced an insured through misrepresentation to surrender an existing insurance policy. What is J guilty of? *
twisting *
