Chapter 17/1: Florida General Regulations

What is the maximum fine for violating a cease and desist order?

Any agent that violates a cease and desist order issued is subject to a maximum penalty of $50,000. The correct answer is: $50,000

How often must the CFO do an examination of a domestic insurer?

Domestic insurers must be examined at least once every 5 years. The correct answer is: At least once every 5 years

Who pays examination expenses?

Each insurer examined will pay the expenses of the examination. Expenses include actual travel expenses, reasonable living expense allowance, and compensation of the examiner or other person making the examination. The correct answer is: The insurer being examined

Who administers Florida insurance laws?

Insurance is a regulated industry because it is a public trust. 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 correct answer is: All of the above

In which of the following may insurers not invest?

Insurers may invest in government, corporate bonds, mortgage loans, real estate, corporate stocks and policy loans. The correct answer is: None of the above

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

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

What is the maximum fine for being guilty of an unfair trade practice?

Agents violating any insurance law regarding applying for a license or committing an unfair practice are subject to having their license suspended, revoked, non-renewed, or refusal to issue. Persons in violation may be subject to a fine between $500 and $3,500 and/or imprisonment for up to six months. The correct answer is: $3,500

Which of the following may impose penalties for breach of the Florida Insurance Code?

Both the Chief Financial Officer and the Florida state court system may impose penalties upon persons who violate Florida insurance laws. The correct answer is: Chief Financial Officer and the State court system

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

When must authorized insurers file their annual financial statements?

Each authorized insurer must file with the office full and true statements of its financial condition, transactions, and affairs. An annual statement covering the preceding calendar year must be filed on or before March 1. The correct answer is: March 1 of the following year

Which of the following is not true regarding the licensing of insurance agencies?

Each insurance agency must have at least one licensed and active insurance agent that is appointed to represent one or more insurers from that agency. The correct answer is: Each insurance agency must have at least two licensed and active insurance agents.

Who pays for the examination by the CFO?

Each insurer examined will pay to the office the expenses of the examination at the rates adopted by the office. The correct answer is: The insurer

Which of the following is 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. The costs of investigations are paid for by the state." 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: All of the above

Which of the following is a true statement?

Insurance transactions requiring agents to perform them must occur within the physical presence of the charge agent. The correct answer is: Insurance transactions requiring agents to perform them must occur within the physical presence of the charge agent.

Which of the following are generally prohibited in Florida?

Legal reserve insurers are mandated by law to invest a portion of each premium in order to pay policy face amounts upon maturation. Assessment insurers may use a legal reserve insurer to maintain the required investment. However, assessment insurers are generally prohibited by law in Florida, except under MEWAs. The correct answer is: Assessment insurers

What is the amount of legal reserve required by Florida law?

The standard valuation law establishes the minimum amount of funds insurers must set aside for the payment of claims and liabilities. The amount of legal reserve is the amount of invested premiums with interest required to pay insurers, future claim obligations. The correct answer is: The amount of invested premiums with interest required to pay insurers, future claim obligations

Which of the following is NOT considered transacting insurance in Florida?

Transacting insurance includes solicitation, negotiation, and effectuation of an insurance contract. Solicitation includes: describing coverage, benefits, giving an invitation to contract to prospective clients, making a purchase recommendation, submitting applications for insurance, comparing policies, or offering to negotiate a viatical settlement. The correct answer is: Storing an application

Who is responsible for writing and amending the Florida Insurance Code?

Florida state legislature will write and amend the Florida Insurance Code (insurance laws of Florida). The correct answer is: The Florida state legislature

How often is the Office of Insurance Regulation entitled to perform a financial examination of an insurer?

The Office of Insurance Regulation is entitled to perform a financial examination of each insurer at least once every 3 years. The correct answer is: At least once every 3 years

How long must agents keep transaction records involving premiums?

Agents must keep records pertaining to transactions involving premiums for at least 3 years. The correct answer is: At least 3 years

An agent who violates a cease and desist order may be subject to a maximum fine of:

Agents violating a cease and desist order may be subject to a fine of up to $50,000. The correct answer is: $50,000

What insurers in Florida must have a certificate of authority?

All insurers must have a certificate of authority to transact insurance in Florida unless they are excess and surplus lines insurers, reinsurers and certain captive insurers. The correct answer is: All of the above

Any insurer that acts as an insurer without proper licensure will be subject to:

Any insurer that acts as an insurer without proper licensure will be subject to: conviction of a first-degree felony. The correct answer is: A first-degree felony

Authorized insurers must submit an annual statement to the Office of Insurance Regulation by:

Authorized insurers must submit an annual statement to the Office of Insurance Regulation annually by March 1st. The correct answer is: March 1st, annually

Who supervises the Division of Insurance Agents and Agency Services?

The CFO is selected by election and heads the Department of Financial Services and supervises the Division of Insurance Agents and Agency Services. The correct answer is: The Chief Financial Officer (CFO)

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

Who of the following is 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: All of the above

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

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

How often can the CFO examine the records and assets of an authorized insurer?

The office and CFO will 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 he or she wants