Florida Laws and Rules Pertinent to Insurance CH. 8
Advertising gifts not to exceed ___ are allowed to be given by an agent to a prospective client. $25 $50 $75 $100
$25
A life policy loan in Florida cannot charge a fixed rate of interest higher than 7% 8% 9% 10%
10%
Employers with less than __ employees are affected by Florida's Health Insurance Coverage Continuation Act (Mini COBRA). 40 30 20 10
20
Within how many days must a licensee notify the Department of Financial Services of a change in address? 30 60 90 120
30
In Florida, a health policy that is paid on a quarterly basis requires a grace period of 7 days 10 days 31 days 45 days
31 days
Florida requires that an insurance agent must complete __ hours of continuing education on the subject of law and ethics every two years. 3 4 5 6
5
A long-term care lapse notice must be delivered to both the applicant and secondary addressee beneficiary personal physician MIB
secondary addressee
A stock life insurance company that issues both participating and nonparticipating policies is doing business on a mixed plan a diverse plan a multiple plan an assorted plan
a mixed plan
An example of an unfair trade practice is an agent making a material misrepresentation to the insured an agent writing less than 50% of their total sales from controlled business replacing an old life insurance policy with a new one denying payment of a claim within a reasonable time after proof of loss statements were provided
an agent making a material misrepresentation to the insured
The coordination of benefits (COB) provision exists in order to avoid duplication of benefit payments avoid excessive hospitalization lower insurance premiums maximize patient care
avoid duplication of benefit payments
One definition of replacement is "the act of replacing an existing insurance policy with another". Replacement is legal and requires no disclosure closely regulated and requires full disclosure not legal in the state of Florida allowed only if the policy originated outside the state of Florida
closely regulated and requires full disclosure
Florida's 14-day free-look period for life insurance policies begins at the date of delivery date of approval date of application date of physical examination
date of delivery
An insurance company incorporated under the laws of the state in which its home office is located is called a(n) ____ company. domestic alien foreign authorized
domestic
The act of an insurance company publishing misleading information about its policy's provisions is called coercion false advertising twisting intimidation
false advertising
In Florida, what is the maximum percentage of controlled business an agent may produce? 30% 40% 50% 60%
50% In Florida, an agent's controlled business may NOT exceed a maximum of 50%.
What do Dread Disease policies cover? A specific disease or illness All diseases or illnesses Only terminal illnesses Only heart-related diseases
A specific disease or illness
What is Florida's definition of Life insurance replacement? A transaction in which coverage on an existing policy is increased A transaction in which group life coverage is converted to an individual policy A transaction in which a new policy is bought and an old policy is terminated A transaction in which a policyowner reinstates a lapsed policy
A transaction in which a new policy is bought and an old policy is terminated
What type of insurance company is domiciled in England, but conducts business in Florida? Foreign Domestic Alien Transatlantic
Alien
All of the following entries are classified under the four principal areas of Florida insurance law EXCEPT An agent's commission Policyowner's rights Policy provisions An agent's licensing requirements
An agent's commission
An example of false advertising would be Paid testimonials from celebrity endorsements An insurer exaggerating its dividends in a magazine advertisement An agent spending more than $25 on marketing gifts for a client An insurer advertising in an insurance trade journal
An insurer exaggerating its dividends in a magazine advertisement
According to Florida law, when must an agent deliver the Outline of Coverage to a Medicare Supplement applicant? At the time of application At the time of policy delivery Within 14 days of the time of application Within 14 days of policy delivery
At the time of application
Which of the following acts is an agent NOT authorized to do on behalf of an insurer? Accept premiums from policyowners Complete insurance applications Authorize claim payments Ask health related questions
Authorize claim payments
All of the following are Nonforfeiture Options EXCEPT Cash Surrender Option Extended Term Option Reduced Paid-Up Option Automatic Premium Loan Option
Automatic Premium Loan Option
Which of the following can an agent provide to help a prospective client understand and purchase the most appropriate product? Policy summary Conditional receipt Buyer's guide Illustration
Buyer's guide
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? Twisting Defamation Coercion Rebating
Coercion
S takes out a health insurance policy which contains a provision that states that the agent does not have the authority to change the policy or waive any of its provisions. Which health policy provision is this? Legal Actions Insurance with other insurers Entire Contract Reinstatement
Entire Contract
Which of the following is NOT a consequence for placing business with an unauthorized insurer? Third degree felony First degree misdemeanor Insurance license revoked Responsible for unpaid claims
First degree misdemeanor
Which of the following is a standard provision of the conversion privileges in a Group Life policy? Group Life coverage can only be converted if the employer pays for the individual policy Group Life coverage can normally be converted to an individual policy within 6 months Group Life coverage can only be converted by providing evidence of insurability Group Life coverage can be converted to an individual policy at regular rates on an attained-age basis
Group Life coverage can be converted to an individual policy at regular rates on an attained-age basis
A Multiple Employer Welfare Arrangement (MEWA) provides what type of benefits? Unemployment Banking Retirement Insurance
Insurance
Which of the following situations are NOT subject to Florida life insurance laws? Insurance companies' day-to-day operations Insurance companies' life policy replacement requirements Insurance companies' setting of life insurance policy rates Insurance companies' guidelines for paying a life insurance claim
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 It may solicit insurance business by mail only with the assistance of a licensed Florida agent Admitted mail order insurance companies are illegal in Florida Admitted mail order insurance companies cannot solicit insurance business outside the state of Florida
It may solicit insurance business by mail without the assistance of a licensed agent
Which Unfair Trade Practice involves an agent suggesting that an insurance policy is like a share of stock? Twisting Intimidation Misrepresentation Sliding
Misrepresentation
Which Unfair Trade Practice involves an agent telling a prospective client that a policy's dividends are guaranteed? Coercion Fraud Misrepresentation Sliding
Misrepresentation
Under an Individual Disability policy in Florida, what is the minimum schedule of time in which claims must be made to an insured? Annually Weekly Monthly Daily
Monthly
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 A list of all policies the agent has replaced in the last 3 years A statement made by the agent that NAIC guidelines have been met during the replacement process A copy of the agent's insurance license
Notice to existing and replacing insurers of intention to replace
Which entity approves the insurance policy forms used in Florida? National Association of Insurance Commissioners (NAIC) Department of Financial Services (DFS) Financial Services Commission (FSC) Office of Insurance Regulation (OIR)
Office of Insurance Regulation (OIR)
How can an agent-in-charge have more than one location? Only if the locations are in Florida By keeping all locations within a close proximity An agent-in-charge can only have one location Only if the agent-in-charge is present when insurance activity occurs
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? Sell the client a more appropriate annuity Pay monetary restitution to the client Provide a written apology letter Pay a penalty of three times the client's loss
Pay monetary restitution to the client
Which of the following is NOT required in the Outline of Coverage for a health insurance policy? Explanation of the policy's benefits Listing of the policy's exclusions and limitations Projection of the policy's future costs Explanation of the policy's renewal and cancellation provisions
Projection of the policy's future costs
Which of these is NOT a legal entity for selling life insurance in Florida? Independent agency system Risk management advisers Career agency system Personal producing general agency
Risk management advisers
Which of the following is NOT considered rebating? Sharing commissions with an agent licensed in the same line of business Returning premium to a client as an inducement for purchasing a policy Giving something of value to an insured in exchange for their business Offering special dividends
Sharing commissions with other licensed agents is not considered rebating.
According to Florida Law, in which of the following situations would a dependent handicapped child NOT be covered under a Family Health policy? The handicapped child has reached the limiting age The premiums for the handicapped child are not paid The handicapped child becomes a full-time student The family moves outside the provider network
The premiums for the handicapped child are not paid
A person insured under a health policy is required to give the insurance company a Notice of Claim within how many days after a covered loss? Five Ten Twenty Thirty
Twenty
The Financial Services Commission may hold hearings for any reason deemed necessary only when a felony is involved when approved by the NAIC only if there is a complaint filed
for any reason deemed necessary
The Florida Employee Health Care Access Act was established to make group health insurance available to employers with up to 50 employees health insurance affordable for families with children individual health insurance available to all Floridians health insurance affordable to retired individuals
group health insurance available to employers with up to 50 employees
A foreign insurance company doing business in Florida is not subject to Florida insurance laws is a company that was formed under the laws of another state is a company that was formed under the laws of another country is only authorized to write business outside the United States
is a company that was formed under the laws of another state
A license may be denied, suspended, or revoked if the licensee engages in replacement of an existing policy is found guilty of misrepresentation does not meet a sales quota files for bankruptcy
is found guilty of misrepresentation
If a policyowner does not pay the premium by the due date, the policy must be reinstated policyowner is automatically assessed a late charge insurance company cancels the policy policyowner can make the premium payment during the grace period
policyowner can make the premium payment during the grace period
According to Florida law, group life insurance conversion privileges must NOT allow the converted policy to exceed 75% of the original group life amount allow a time period to convert group life coverage to an individual life policy require a rate increase require evidence of insurability
require evidence of insurability
When replacing or exchanging an annuity, the agent must disclose to the annuitant the commissions to be paid as a result of the transaction the possible tax ramifications as a result of the transaction the insurer's A.M. Best rating proof of appointment by the agent
the possible tax ramifications as a result of the transaction
Association Plans that are designed to provide health benefits to their members are regulated by the state because they are insured by an authorized insurer they conduct business in Florida they provide a service to their members they require a certain level of member participation
they are insured by an authorized insurer
Group Life policies in Florida are required to contain a conversion privilege that allows for conversion with evidence of insurability to an individual policy for a stated period of time only if the premiums are paid by the employer to an individual policy at anytime
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, only by providing evidence of insurability to an individual policy, only if the employer pays the premiums to an individual policy upon employment termination to an individual policy with a higher amount of coverage
to an individual policy upon employment termination
A life insurance policyowner may sell their policy to a(n) _____ in order to receive a percentage of the policy's face value. viatical settlement provider broker insurer viator agent
viatical settlement provider
