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 *