Florida Life and Health Final Exam

Florida Life and Health Final Exam

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Florida Life and Health Final Exam

• Which Unfair Trade Practice involves making a false statement on an insurance application

in order to receive money from an insurer?

Answer: Misrepresentation

• Who owns a stock company?

Answer: A stock insurance company is owned by its stockholders.

• In Florida, which of the following is considered an Unfair Trade Practice?

Answer: -Coercion

• Which of these options can an individual use their medical flexible spending account to pay

for?Answer: Prescription drugs are an allowable expense when paid for by a medical flexible spending account.

• Which of the following features of a group Term Life policy enables an individual to leave

the group and continue his or her insurance without providing evidence of insurability?Answer: The conversion privilege allows an individual to leave the group term plan and continue his or her insurance without providing evidence of insurability.

• An example of false advertising would be

Answer: An insurer exaggerating its dividends in a magazine advertisement

• Q purchases a $500,000 life insurance policy and pays $900 in premiums over the first six

months. Q dies suddenly and the beneficiary is paid $500,000. This exchange of unequal values reflects which of the following insurance contract features?

Answer: Aleatory.

Insurance contracts are aleatory in that the amount the insured will pay in premiums is unequal to the amount that the insurer will pay in the event of a loss.

• An example of an unfair trade practice is

Answer: Making a material misrepresentation to an insured is considered to be an unfair trade practice.

• How would a contingent beneficiary receive the policy proceeds in an Accidental Death

and Dismemberment (AD&D) policy?Answer: A contingent beneficiary will receive the policy proceeds if the primary beneficiary dies before the insured's death.

• Which of these terms accurately defines an underwriter's assessment of information on a

life insurance application? 2 / 3

Answer: Risk classification.

Underwriting, another term for risk selection, is the process of reviewing the many characteristics that make up the risk profile of an applicant to determine if the applicant is insurable and, if so, at standard or substandard rates.

• T applies for a life insurance policy and is told by the producer that the insurer is bound

to the coverage as of the date of the application or medical examination, whichever is later.Assuming that T is an acceptable risk, what item is given to T?

Answer: Conditional receipt.

A conditional receipt binds the insurer to coverage as of the date of the application

or medical exam, provided the proposed insured is determined to be an acceptable risk.

• What is required in the Florida Employee Health Care Access Act?

Answer: Small group benefit plans are to be issued on a "guarantee-issue" basis

• P and Q are married and have three children. P is the primary beneficiary on Q's

Accidental Death and Dismemberment (AD&D) policy and Q's sister R is the contingent beneficiary. P, Q, and R are involved in a car accident and Q and R are killed instantly. The Accidental Death benefits will be paid to

Answer: P.

In this situation, benefits will be paid to P because P survived the accident and is the primary beneficiary.

• The health insurance program which is administered by each state and funded by both the

federal and state governments is called Answer: Medicaid- is funded by both the federal and state governments and administered by individual states.

• Which of the following BEST describes a short-term medical expense policy?

Answer: Nonrenewable.

A typical short-term medical expense policy is best described as nonrenewable.

• Which of the following statements about noncontributory employee group life insurance is

FALSE?

Answer: A minimum number of employees is required to participate". Noncontributory employee group life insurance plans must cover ALL eligible employees at all times

• A Disability Income policyowner recently submitted a claim for a chronic neck problem

that has now resulted in total disability. The original neck injury occurred before the application was taken 5 years prior. The neck injury was never disclosed to the insurer at the time of application. How will the insurer handle this claim?

Answer: Claim will be paid and coverage will remain in force.

After a policy has been in force for 2 (sometimes 3) years, it enters the incontestable period, in

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