Chapter Five Quiz
Which of the following is true regarding the agent's appointments?
a person may hold several appointments at one time
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
When transacting business in this state an insurer formed under the laws of another country is known as a/an:
alien insurer
How are state Insurance Guaranty Associations funded?
by their members - authorized insurers
Which of the following must an insurer obtain in order to transact Insurance within a given state?
certificate of authority
What term is used for replacing insurance policies for the sole purpose of making commissions?
churning
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
No insurance policy form can be issued, delivered, or used in this state unless it has been:
filed with and approved by the Office of Insurance Regulation
What are the responsibilities of the office of insurance regulation?
instituting legal proceedings, enforcing the insurance code, issuing certificates of authority
Which of the following best describes a misrepresentation?
issuing sales material with exaggerated statements about policy benefits
What are the 2 offices of the Financial Services Commission?
the Office of Financial Regulation and the Office of Insurance Regulation
What is the minimum age that a person can obtain a life insurance license?
18
An agent has been convicted of a crime punishable by one 1-year imprisonment. Within how many days must the agent notify the Department of Insurance?
30 days
An applicant for a life agent's license may obtain a temporary license for a maximum period of:
6 months
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
Under special circumstances, continuing education requirements may be extended beyond the 2-year period for a maximum period of:
12 months
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%
When applying for an individual life insurance policy, an applicant states that he went to the doctor for nausea, but fails to mention that he was also having severe chest pains. This is an example of:
concealment
What method do insurers use to protect themselves against catastrophic losses?
reinsurance
An insurance producer just sold an insurance policy to his sister. What kind of business is this?
controlled
Which of the following terms describes making false statements about the financial condition of any insurer that are intended to injure any person engaged in the business of insurance?
defamation
Which of the following will be considered unfair discrimination by insurers?
discriminating in benefits and coverage based on the insured's habits and lifestyle
The inclusion of the Life and Health Guaranty Association in an advertisement by an insurer is:
forbidden
What is true regarding a Certificate of Authority?
it may be necessary for transacting business in a specific state, it is equivalent to an insurance license, it is issued by the State Department of Insurance
On a participating insurance policy issued by a mutual insurance company, dividends paid to policyholders are:
not taxable since the IRS treats them as a return of a portion of the premium paid
All of the following are true regarding rebates:
rebates are only allowed if specifically stated in the policy, rebating can be anything of economic value given as an inducement to buy, dividends are not considered to be rebates
An agent offers his client free tickets to a sporting event in exchange for the purchase of an insurance policy. The agent is guilty of:
rebating
Any inducement offered to the insured in the sale of an insurance policy that is not specified in the policy is an unlawful practice known as:
rebating
If a person accumulates more continuing education hours than is necessary to fulfill the requirements for a 2-year period, which of the following will occur?
the extra hours may be continued into the next period
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
