Chapter 5: FL Statutes, Rules, and Regulations

Insurance contract:

An agreement between a policyowner (often an insured) and an insurer, where the insurer agrees, for a consideration, to indemnify the insured for loss caused by specific events.

A life insurance agent must complete how many hours of continuing education in annuity suitability every licensing period?

3

What level of authority is given to the Office of Insurance Regulation with respect to examination of insurer's activities to determine compliance Unfair Trade Practice laws?

Absolute

An insurance producer just sold an insurance policy to his sister. What kind of business is this?

Controlled

Insurance transaction:

1) Solicitation 2) Negotiations 3) Sale (effectuation of a contract of insurance) 4) Advising an individual concerning coverage or claims.

Which of the following persons is required to hold a producer license?

A person who negotiates insurance contracts

Failure of a licensee to maintain an appointment with an insurance company within 48 months after the date the license became effective will result in

Expiration of the license

In insurance transactions, fiduciary responsibility means

Handling insurer funds in a trust capacity

An insured purchased an insurance policy 5 years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insurer. From what type of insurer did the insured purchase the policy?

Mutual

All of the followings would be considered an insurance transaction EXCEPT

Obtaining an insurance license

Which of the following is an example of an agent's fiduciary responsibilities?

Promptly forwarding premiums to the insurance company

In what way can an agent demonstrate a high standard of ethics?

Putting the client's best interest before their own

In accordance with the Code of Ethics, agents must provide a completed application to

The prospective insured and the insurer.

An agent transacts business for Insurer A and Insurer B, both selling life insurance, and for Insurer C, selling health insurance. How many appointments must the agent hold?

Three- one for each insurer

If an agent does not notify the insurer of an address change, what is the maximum penalty that can be imposed for a one-time offense?

$250

An agent's appointment has been denied. Which of the following is true?

State taxes may be refunded upon a written request.

Under special circumstances, continuing education requirements may be extended beyond the 2-year period for a maximum period of

12 months

When doing business in this state an insurance company that is formed under the laws of another state is known as which type of insurer?

Foreign

Which of the following activities would be sufficient violation to warrant rejection, revocation, or suspension of an insurance agent's license?

Forgery

Which of the following would be required to be licensed as an insurance producer?

A salaried employee who advertises and solicits insurance

Which of the following would NOT be a violation of state insurance regulations?

Agent C uses her license to write only business other than controlled.

Rebating is an unfair trade practice and is regulated by law. All of the following would be considered to be rebating EXCEPT

An agent uses misrepresentation to convince a person to cancel an existing policy and take a new policy from him.

The requirement that agents not commingle insurance monies with their own funds is known as

Fiduciary responsibility.

The inclusion of the Life and Health Guaranty Association in an advertisement by an insurer is

Forbidden

The Office of Insurance Regulation is responsible for all of the following insurer activities EXCEPT

Issue of securities

If during a sales presentation a producer intentionally makes a statement which may mislead the insurance applicant, the producer has committed

Misrepresentation

Which of the following insurers are owned by stockholders who have the usual rights of ownership, including the right of voting?

Stock

Which of the following entities is responsible for agent licensing and administrative supervision?

The Office of Insurance Regulation

If a licensee changes his or her residence address, within how many days must the department be notified?

30

An agent has been convicted of a crime punishable by a 1-year imprisonment. Within how many days must the agent notify the department of insurance?

30 days

In the state of Florida, it is illegal for a licensee's commissions from controlled business to exceed what percentage of the total in a given year?

50%

An insurance company is domiciled in Montana and transacts insurance in Wyoming. Which term best describes the insurer's classification in Wyoming?

Foreign

Which of the following entities protects policyowners, insureds, and beneficiaries under insurance contracts when insurers fail to perform contractual obligations due to financial impairment?

Insurance Guaranty Association

Which of the following is NOT true regarding a Certificate of Authority?

It is issued to group insurance participants.

If an agent is in the military, which of the following is true?

The agent cannot sell a policy to another active military person.

How often must domestic insurance companies be examined by the Chief Financial Officer in Florida?

At least every 5 years

An insurance agent X has been found guilty of a felony and was sentenced to 3 years in prison. What would be the appropriate plan of action?

Send a written notification to the department of insurance

Insurer:

the company or organization that issues a policy of insurance

All of following are the general qualifications for an agent's license EXCEPT

Have a highschool diploma

An insurance agent B likes to add additional coverages to applicants' policies and charge them for such coverages without their knowledge. The agents is guilty of

Sliding

An insured submits a proof of loss form within 10 days of a loss. The insurer, however, does not acknowledge the form for 3 months. Which of the following violations has the insurer committed?

Unfair claims settlement

Which of the following is true regarding branch agency licensing?

Agent in charge must be licensed.

Which of the following statements is INCORRECT?

Replacing insurance policies for the purpose of making commissions is legal.

Which of the following is an agreement between an insured and an insurer, where the insurer agrees to indemnify the insured for specific losses in exchange for a premium?

The insurance contract

If an insurer meets the state's financial requirements and is approved to transact business in the state, it is considered to be

Authorized

Which of the following best describes a misrepresentation?

Issuing sales material with false statements about policy benefits

In which of the following situations is it legal to limit coverage based on marital status?

It is never legal to limit coverage based on marital status.

Which of the following best describes an unfair trade practice of defamation?

Making derogatory oral statements about another insurer's financial condition

Which of the following is the closest term to an "authorized" insurer? ALegal

admitted

Which of the following is NOT a responsibility of the Office of Insurance Regulation?

Enacting new insurance laws

Agents who persuade insureds to cancel a policy in favor of another one when it might not be in the insured's best interest are guilty of

Twisting.