Florida 2-15 Insurance License Exam; Brand New Questions With Correct Answers +Rationale<\/p>\n\n\n\n
Florida 2-15 Insurance Exam 1
Florida 2-15 InsuranceLicense Exam; Brand
New Questions With Correct Answers
+Rationale
All statements made by an applicant in an application for life insurance are
considered to be
A. warranties
B. affirmations
C. representations
D. declarations
(Correct Ans: – C. Most states require that life insurance policies contain a provision
that all statements made in application be deemed representation not warranties. A
representation is a statement made by the applicant that the applicant believes to
be true. A warranty is a statement made by the applicant that is guaranteed to be
true. If an insurance company rejects a claim on the basis of a representation, the
company bears the burden of proving materiality.
Which of the following legal terms indicates that a life insurance contract contains
the enforceable promises of only one party?
A. adhesion
B. unilateral
C. conditional
D. aleatory
(Correct Ans: – B. Insurance contracts are unilateral in that only one party – the
insurer – makes any kind of enforceable promise.
Which of the following types of agent authority is specifically set forth in writing in
the agent’s contract?
A. express
B. implied
C. apparent
D. personal<\/p>\n\n\n\n
Florida 2-15 Insurance Exam 2
(Correct Ans: – A. Express authority is the authority a principal gives to its agent.
Express authority is granted by means of the agent’s contract, which is the
principal’s appointment of the agent to act on its behalf.
Assume a home catches fire after it is struck by lightning and the fire destroys its
structure and contents. By insurance definition, the fire is
A. the risk
B. the hazard
C. the peril
D. the proximate cause
(Correct Ans: – C. A peril is the immediate specific event causing loss and giving rise
to risk. When a building burns, fire is the peril.
What constitutes “consideration” for a life insurance policy?
A. application and initial premium
B. agent’s commission
C. adhesion feature of the contract
D. policy’s benefits
(Correct Ans: – A. Consideration is the value given in exchange for the promises
sought. In an insurance contract, consideration is given by the applicant in
exchange for the insurer’s promise to pay benefits, and it consists of the application
and the initial premium.
Statements made by an applicant for life insurance that are guaranteed to be true
are
A. warranties
B. material statements
C. representations
D. declarations
(Correct Ans: – A. A warranty in insurance is a statement made by the applicant that
is guaranteed to be true. It becomes part of the contract and, if found to be untrue,
can be grounds for revoking the contract. Warranties are presumed to be material
because they affect the insurer’s decision to accept or reject an applicant.<\/p>\n\n\n\n
Florida 2-15 Insurance Exam 3
Which of the following insurance companies is owned by its policyholders?
A. service insurer
B. stock insurer
C. reinsurer
D. mutual insurer
(Correct Ans: – D. Mutual insurers are owned by the policyholders. Anyone
purchasing insurance from a mutual insurer is both a customer and an owner.
With regard to life insurance, all of the following statements are correct EXCEPT
A. all individuals are considered to have insurable interests in themselves
B. spouses are automatically considered to have insurable interests in each other
C. a creditor has an insurable interest in a debtor
D. insurable interest must be maintained throughout the life of the contract
(Correct Ans: – D. Insurable interest is required only when a contract is issued; it
does not have to be maintained throughout the life of the contract nor is it
necessary at the time of claim.
In the insurance business, risk can best be defined as:
A. sharing the possibility of a loss
B. uncertainty regarding the future
C. uncertainty regarding financial loss
D. uncertainty regarding when death will occur
(Correct Ans: – C. The concept of insurance developed from the need to minimize
the adverse effects of risk associated with the probability of financial loss.
Which of the following risks is insurable?
A. pure risks
B. gambling<\/p>\n\n\n\n
Florida 2-15 Insurance Exam 4
C. speculative risks
D. investing
(Correct Ans: – A. Only pure risks are insurable because they involve only the chance
of loss. They are pure in the sense that they do not mix both profits and losses.
Insurance is concerned with the economic problems created by pure risks.
Buying insurance is one of the most effective ways of
A. avoiding risk
B. transferring risk
C. reducing risk
D. retaining risk
(Correct Ans: – B. Buying insurance is one of the most effective ways of transferring
risk. Through the insurance contract, the burden of carrying the risk and
indemnifying the financial loss is transferred from the individual to the insurance
company.
Which of the following best describes the function of insurance?
A. it is a form of legalized gambling.
B. it spreads financial risk over a large group to minimize the loss to any one
individual
C. it protects against living too long
D. it creates and protects risks
(Correct Ans: – B. The function of insurance is to safeguard against financial loss by
having the losses of few paid by the contributions of many who are exposed to the
same risk.
All of the following are elements of an insurable risk EXCEPT
A. the loss must be due to chance
B. the loss must be predictable
C. the loss must be catastrophic
D. the loss must have a determinable value
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