Florida Life & Health Practice Test Florida Health and Life Insurance 347 Pooled Exam with, Exams of Insurance law

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Florida Life & Health Practice Test

Florida Health and Life Insurance 347

Pooled Exam with A+ Answers.

1. According to Mandatory Uniform Policy Provisions, what is the maximum amount of time after the premium due date during which the policy remains in force even though the premium has not been paid? - Correct Ans: ✔✔31 days
2. G purchased a Family Income policy at age 40. The policy has a 20- year rider period. If G were to die at age 50, how long would G's family receive an income? - Correct Ans: ✔✔10 years
3. E and F are business partners. Each takes out a $500,000 life insurance policy on the other, naming himself as primary beneficiary. E and F eventually terminate their business, and four months later E dies. Although E was married with three children at the time of death, the primary beneficiary is still F. However, an insurable interest no longer exists. Where will the proceeds from E's life insurance policy be directed to? - Correct Ans: ✔✔F
4. The Health Insurance Portability and Accountability Act (HIPAA) gives privacy protection for: - Correct Ans: ✔✔health information

5. What do Dread Disease policies cover? - Correct Ans: ✔✔A specific disease or illness
6. When an insurance application is taken by a producer, which of these statements is true? - Correct Ans: ✔✔Any changes made on the application require the applicant's initials
7. A student pilot can pay regular premium costs for her life insurance policy with the addition of which of the following? - Correct Ans: ✔✔Aviation exclusion
8. What is the consideration given by an insurer in the Consideration clause of a life policy? - Correct Ans: ✔✔Promise to pay a death benefit to a named beneficiary
9. Which of the following reimburses its insureds for covered medical expenses? - Correct Ans: ✔✔Commercial insurers
10. Under Florida law, which of the following provisions is NOT required in a Medicare Supplement policy? - Correct Ans: ✔✔Limitation on pre-existing conditions for up to 12 months
11. Which organization was established to provide funds to protect an insured in the event of an insurer's insolvency? -

Correct Ans: ✔✔Florida Life and Health Insurance Guaranty Association

12. Major Medical policies typically: - Correct Ans: ✔✔contain a deductible and coinsurance
13. The Life and Health Insurance Guaranty Association is - Correct Ans: ✔✔funded by admitted insurance companies through assessments
14. 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: - Correct Ans: ✔✔P only
15. Which of the following is considered an accurate statement of an unfair trade practice? - Correct Ans: ✔✔Twisting involves an agent using misrepresentation to convince a policyowner to cancel their current policy so that they can purchase a new life insurance policy with another company
16. Which of the following is an example of an Unfair Trade Practice? - Correct Ans: ✔✔Coercison

17. The Legal Actions provision of an insurance contract is designed to do all of the following, EXCEPT: - Correct Ans: ✔✔protect the producer
18. Which of these actions should a producer take when submitting an insurance application to an insurer? - Correct Ans: ✔✔Inform insurer of relevant information not included on the application
19. A Health Reimbursement Arrangement MUST be established: - Correct Ans: ✔✔by the employer
20. If an individual has an Accidental Death and Dismemberment policy and dies, and autopsy can be performed in all these situations, EXCEPT: - Correct Ans: ✔✔When the state prohibits this by law
21. P is a producer who notices 5 questions on a life application were not answered. What actions should P take? - Correct Ans: ✔✔Set up a meeting with the applicant to answer the remaining questions
22. A disability elimination period is best described as a: - Correct Ans: ✔✔time deductible

23. Which type of insurance company allows their policyowners to elect a governing body? - Correct Ans: ✔✔Mutual
24. Two partners own equal shares in a business worth a total of $1,000,000. If they both commit to the purchase of a life insurance policy that will fund a Buy-Sell Agreement, which of the following is TRUE? - Correct Ans: ✔✔Each partner owns a $500,000 policy on their partner's life
25. N is a student pilot with a large life insurance policy. Which of these features would limit the insurer's obligation in the event N was killed while flying as a student pilot? - Correct Ans: ✔✔Exclusion
26. A policyowner's rights are limited under which beneficiary designation? - Correct Ans: ✔✔Irrecovable
27. What kind of Accidental Death and Dismemberment (AD&D) insurance beneficiary requires his/her consent when a change of beneficiary is made? - Correct Ans: ✔✔Irrevocable beneficiary
28. Which type of contract liquidates an estate through recurrent payments? - Correct Ans: ✔✔Annuity

29. Under Florida law, a variable annuity policyowner must be notified of the accumulated value of the contract - Correct Ans: ✔✔once each year
30. J let her life insurance policy lapse 8 months ago due to nonpayment. She can reestablish coverage under which of the following provisions? - Correct Ans: ✔✔Reinstatement provision
31. Which is the purpose of the Life and Health Insurance Guaranty Association? - Correct Ans: ✔✔Protects policyowners against insolvent insurance companies
32. Which of the following Dividend options results in taxable income to the policyowner? - Correct Ans: ✔✔Accumulation at Interest
33. Accidental Death coverage is provided to commercial airline passengers in which of the following types of policies? - Correct Ans: ✔✔Blanket Accident policy
34. A life policy with a death benefit that can fluctuate according to the performance of its underlying investment portfolio is referred to as: - Correct Ans: ✔✔Variable Life

35. When replacing or exchanging an annuity, the agent must disclose to the annuitant - Correct Ans: ✔✔the possible tax ramifications as a result of the transaction
36. When an insurance company sends a policy to the insured with an attached application, the element that makes the application part of the contract between the insured and the insurer is called the: - Correct Ans: ✔✔Entire Contract provision
37. Which of the following health policy provisions states that the producer does NOT have the authority to change the policy or waive any of its provisions? - Correct Ans: ✔✔Entire Contract
38. The waiting period for a pre-existing condition under a Medicare Supplement policy may NOT go beyond - Correct Ans: ✔✔6 months
39. Many small business owners worry how their business would survive financially if the owner becomes disabled. The policy which BEST addresses this concern is: - Correct Ans: ✔✔Business Overhead Expense
40. K has a health policy that must be renewed by the insurer and the premiums can only be increased if applied to the entire class of insureds. This type of policy is considered: - Correct Ans: ✔✔guaranteed renewable

41. Information obtained from a phone conversation to the proposed insured can be found in which of these reports? - Correct Ans: ✔✔inspection report
42. On a life insurance policy, who is qualified to change the beneficiary designation? - Correct Ans: ✔✔Policyowner
43. An example of false advertising would be - Correct Ans: ✔✔An insurer exaggerating its dividends in a magazine advertisement
44. Which of the following statements regarding a Tax Sheltered Annuity (TSA) is INCORRECT? - Correct Ans: ✔✔The income from the TSA is received income tax-free
45. According to Florida law, a Group Life insurance policy requires a minimum of how many insureds? - Correct Ans: ✔✔No minimum
46. A young, married teacher has two children and owns a Whole Life policy. If the teacher wants an Increasing Death Benefit to protect against inflation, the teacher should select which of the following Dividend Options? - Correct Ans: ✔✔Paid- Up Additional Insurance

47. What type of renewability guarantees premium rates and renewability? - Correct Ans: ✔✔Noncancellable
48. What provisions in a life insurance policy states that the application is considered part of the contract? - Correct Ans: ✔✔Entire Contract provision
49. Which of the following is NOT included in the policy face? - Correct Ans: ✔✔Exclusions
50. What would the Medical Information Bureau (MIB) identify?
    • Correct Ans: ✔✔Testing positive for marijuana use from a previous screening
51. J owns a business and has a Group Life policy covering her employees. J decides to cancel the policy by letting it lapse on the renewal date. What action must be taken? - Correct Ans: ✔✔All of the employees must be notified of the cancellation wither by the insurance company of through J
52. Florida requires that an insurance agent must complete ___ hours of continuing education on the subject of law and ethics every two years. - Correct Ans: ✔✔ 5

53. After an insured gives notice of loss, what must he/she do if the insurer does not furnish forms? - Correct Ans: ✔✔File written proof of loss
54. A physician opens up a new practice and qualifies for a $7,000/month Disability Income policy. What rider would the physician add if he wants the ability to increase his policy benefit as his practice and income grow? - Correct Ans: ✔✔Guaranteed Insurability Option rider
55. An insurance company receives E's application for an individual health policy. E did not complete all of the medical history questions because she could not remember the exact dates. E signed the policy and submitted it to the insurance company anyway. A few weeks later, E suffers a heart attack and is hospitalized without completing the medical history questions and paying the initial premium. E is not insured. Which of the following clauses details the conditions that E did not meet? - Correct Ans: ✔✔Consideration clause
56. If an agent would like to sell Variable annuities, which state examination must the agent pass? - Correct Ans: ✔✔Life and Variable contracts
57. During the course of an insurance transaction, if an agent makes a false of incomplete statement, he/she could be found guilty of - Correct Ans: ✔✔misrepresentation

58. Which of the following policy provisions prohibits an insurance company from incorporating external documents into an insurance policy? - Correct Ans: ✔✔Entire Contract
59. Periodic health claim payments MUST be made at least: - Correct Ans: ✔✔monthly
60. A life policy loan in Florida cannot charge a fixed rate of interest higher than - Correct Ans: ✔✔10%
61. What type of group insurance plan involved employees sharing the cost? - Correct Ans: ✔✔contributory plan
62. The Florida Employee Health Care Access Act was established to make - Correct Ans: ✔✔group health insurance available to employers with up to 50 employees
63. Which of these is NOT a legal entity for selling insurance in Florida? - Correct Ans: ✔✔Risk management advisors
64. From what authority derives the requirement that an insurance application contains a disclosure stating that an investigative consumer report may be obtained on an applicant? - Correct Ans: ✔✔Fair Credit Reporting Act

65. S wants to open a tax-exempt Health Savings Account. To qualify for this type of account, Federal law dictates that S must be enrolled in a: - Correct Ans: ✔✔High-deductible health plan
66. If an insurance company issues a Disability Income policy that it cannot cancel of for which it cannot increase premiums, the type of renewability that best describes the policy is called: - Correct Ans: ✔✔noncancellable
67. A Multiple Employer Welfare Arrangement (MEWA) provides what type of benefits? - Correct Ans: ✔✔Insurance
68. 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 - Correct Ans: ✔✔to an individual policy upon employment termination
69. Which of the following statements describes what an Accident and Health policyowner may NOT do? - Correct Ans: ✔✔Adjust the premium payments
70. According to Florida Law, in which of the following situations would a dependent handicapped child NOT be covered under a

Family Health policy? - Correct Ans: ✔✔The premiums for the handicapped child are not paid

71. K is an agent who made an improper sales of an annuity to a client/ Which of the following corrective actions would the Department of Financial Services likely order K to take - Correct Ans: ✔✔Pay a monetary restitution to the client
72. Which of these types of life insurance allows the policyowner to have level premiums and to also choose from a selection of investment options? - Correct Ans: ✔✔Variable Life
73. Rick recently died and left behind an individual IRA account in his name. His widow was forwarded the balance of the IRA. The widow qualifies for the: - Correct Ans: ✔✔marital deduction
74. What are adjustable rates for the life policy loans in Florida based on? - Correct Ans: ✔✔Moody's corporate bond index
75. According to the Time Limit of Certain Defenses provision in an Individual Health Insurance Policy, nonfraudulent misstatements first become incontestable: - Correct Ans: ✔✔two years from the date of the policy was issued

76. Which of the following does Social Security NOT provide benefits for? - Correct Ans: ✔✔Dismemberment
77. What type of insurance company is domiciled in England, but conducts business in Florida? - Correct Ans: ✔✔Alien
78. S buys a $50,000 whole life policy with a $50,000 Accidental Death and Dismemberment rider. S dies 1 year later of natural causes. How much will the insurer pay the beneficiary? - Correct Ans: ✔✔$50,
79. Which of the following is NOT an unfair claim settlement practice? - Correct Ans: ✔✔Needing written documentation of claim details
80. P died five years after purchasing a life policy. While investigating the claim, the insurer discovered material misrepresentations made by P during the application process. Which of these actions will the insurer take? - Correct Ans: ✔✔Beneficiary will be paid the Death Benefit
81. Florida's 14-day free-look period for life insurance policies begins at the - Correct Ans: ✔✔date of delivery

82. An individual covered under a Group Life insurance policy is considered to be a(n) - Correct Ans: ✔✔certificate holder
83. What is considered to be a characteristic of a Conditionally Renewable Health Insurance policy? - Correct Ans: ✔✔Premiums may increase at time of renewal
84. Florida requires that coverage for newborns begins "from the moment of birth" and continues for - Correct Ans: ✔✔ 18 months
85. Company Z has a Cross Purchase Buy-Sell Agreement in place among its three founding partners. If the agreement is funded with individual life insurance, what would it require? - Correct Ans: ✔✔Each partner must own a policy on the other partners
86. J is 35-years old and looking to purchase a whole life insurance policy. Which of the following types of policies will provide the most rapid growth of cash value? - Correct Ans: ✔✔ 20 - pay Life
87. Which parts of a life insurance insurance policy are guaranteed to be true? - Correct Ans: ✔✔Warranty

88. An individual has a Major Medical policy with a $5, deductible and an 80/20 Coinsurance clause. How much will the INSURED have to pay if a total of $15,000 in covered medical expenses are incurred? - Correct Ans: ✔✔$7,000 ($5,000 + 20% of the remaining bill = $7,000)
89. Employers with less than __ employees are affected by Florida's Health Insurance Coverage Continuation Act (Mini COBRA) - Correct Ans: ✔✔ 20
90. An insurance company incorporated under the laws of the state in which its home office is located is called a(n) ___ company. - Correct Ans: ✔✔domestic
91. J, an Accidental Death and Dismemberment (AD&D) policy holder, dies after injuries sustained in an accident. J's age as stated on the application five years ago was found to be understated by ten years. Which of the following actions will the insurance company take? - Correct Ans: ✔✔The insurer will adjust the benefit to what the premiums paid would have purchased at the insured's actual age
92. The guarantee of insurability option provides a long-term care policyowner the ability to: - Correct Ans: ✔✔buy additional coverage at a later date

93. Group Life policies in Florida are required to contain a conversion privilege that allows for conversion - Correct Ans: ✔✔to an individual policy for a stated period of time
94. An agent gives a conditional receipt to a client for an insurance policy after collecting the initial premium. When will the policy become effective? - Correct Ans: ✔✔When the conditions of the receipt are met
95. With Disability Income insurance, an insurance company may limit the monthly benefit amount a prospective policy holder may obtain because of the insured's - Correct Ans: ✔✔gross income at the time of the purchase
96. Which of these statements accurately describes the Waiver of Premium provision in an Accident and Health policy? - Correct Ans: ✔✔Premiums are waived after the insured has been totally disabled for a specified time period
97. A policy that becomes a Modified Endowment Contract (MEC): - Correct Ans: ✔✔will lose many of its tax advantages
98. An employee with $25,000 group term life coverage was recently fired. This employee's group coverage may be converted to a: - Correct Ans: ✔✔$25,000 individual whole life policy

99. Agents that have been licensed for less than six years must complete ___ hours of continuing education every two years. - Correct Ans: ✔✔ 24
100. L takes out a life insurance policy and dies 10 years later. During the claim process, the insurer discovers that L had understated her age on the application. Under the Misstatement of Age provision, the insurer will: - Correct Ans: ✔✔adjust the death benefit to a reduced amount
101. S filed a written Proof of Loss for a Disability Income claim on September 1. The insurance company did not respond to the claim. S can take legal action against the insurer beginning: - Correct Ans: ✔✔November 1 (60 days after written proof of loss before legal action can be brought against the company)
102. Which of the following statements about accumulated interest earned on dividends from an insurance policy is TRUE? - Correct Ans: ✔✔It is taxed as ordinary income
103. What kind of life insurance policy pays a specified monthly income to a beneficiary for 30 years and then pays a lump sum benefit at the end of that 30 years? - Correct Ans: ✔✔Family Maintenance Policy

104. An agent selling Medicare Supplement policies must provide every applicant with a(n) - Correct Ans: ✔✔Suitability form
105. A policy loan is made possible by which of these life insurance policy features? - Correct Ans: ✔✔Cash value provision
106. Which of these life insurance riders allows the applicant to have excess coverage? - Correct Ans: ✔✔Term rider
107. A variable insurance policy: - Correct Ans: ✔✔does not guarantee a return on investment accounts
108. Which of the following is NOT required in the Outline of Coverage for a health insurance policy? - Correct Ans: ✔✔Projection of the policy's future costs
109. What percentage of eligible persons must a policy cover in a noncontributory group? - Correct Ans: ✔✔100%
110. When does a life insurance contract become effective if the initial premium is not collected during the application process? - Correct Ans: ✔✔When producer delivers policy and collects initial premium

111. Premature IRA distributions are assessed a penalty tax of: - Correct Ans: ✔✔10%
112. Which of these circumstances is a Business Disability Buy- Sell policy designed to help in the sale of a business? - Correct Ans: ✔✔Business owner becoming disabled
113. Association Plans that are designed to provide health benefits to their members are regulated by the state because - Correct Ans: ✔✔they are insured by an authorized insurer
114. How long does the coverage normally remain on a limited- pay life policy? - Correct Ans: ✔✔age 100
115. Under what system do a group of doctors and hospitals in a designated area contract with an insurer to provide services at a prearranged cost to the insured? - Correct Ans: ✔✔PPO (Preferred Provider Organization)
116. An example of rebating would be - Correct Ans: ✔✔offering a client something of value not stated in the contract in exchange for their business
117. When is a Group Health policy required to provide coverage for a newborn child? - Correct Ans: ✔✔At the moment of birth

118. A characteristic of Preferred Provider Organizations (PPOs) would be: - Correct Ans: ✔✔Discounted fees for the patient (PPO

- a group of doctors and hospitals in a designated area contract with an insurer to provide services at a prearranged cost to the insured) 

119. M purchased an Accidental Death and Dismemberment (AD&D) policy and named his son as beneficiary. M has the right to change the beneficiary designation at anytime. What type of beneficiary is his son? - Correct Ans: ✔✔Revocable
120. Which of the following is a standard provision of the conversion privileges in a Group Life policy? - Correct Ans: ✔✔Group Life coverage can be converted to an individual policy at a regular rates on an attained-age basis
121. B is a teacher who was injured in a car accident and cannot work. She is now receiving monthly benefits as a result of this accident. Which type of policy does B have? - Correct Ans: ✔✔Disability Income
122. 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? - Correct Ans: ✔✔ 20

123. Which of the following documents must an agent submit to the replacing insurance company during the replacement of an existing life insurance policy? - Correct Ans: ✔✔Notice to existing and replacing insurers of intention to replace
124. Under the USA Patriot Act, insurers are required to report receipt of cash payments in excess of: - Correct Ans: ✔✔$10,000
125. According to Florida's rules on disclosure, a life insurance applicant is expected to be provided with - Correct Ans: ✔✔a Buyer's Guide and Policy Summary
126. The provision that can be used to put an insurance policy back in force after it has lapsed due to nonpayment is called: - Correct Ans: ✔✔Reinstatement
127. Which of the following BEST describes how a Preferred Provider Organization (PPO) is less restrictive than a Health Maintenance Organization (HMO)? - Correct Ans: ✔✔More physicians to choose from
128. Which health policy clause stipulates that an insurance company must attach a copy of the application to the policy to ensure that it is part of the contract? - Correct Ans: ✔✔Entire Contract

129. Credit Life insurance is: - Correct Ans: ✔✔issued in an amount not to exceed the amount of the loan
130. S recently received a $500,000 lump sum retirement buyout from her employer. She would like to buy an annuity that will immediately furnish her with a guaranteed income for life. What type of annuity is best suited for her situation? - Correct Ans: ✔✔Single Premium
131. What kind of insurance policy supplies an income stream over a set period of time that starts when the insured dies? - Correct Ans: ✔✔Family Maintenance Policy
132. The option that provides an additional death benefit for a limited amount of time at the lowest possible cost is called a(n): - Correct Ans: ✔✔Accidental Death and Dismemberment rider (AD&D)
133. K applies for a life insurance policy on herself and submits the initial premium with the application. She is given a receipt by the agent stating that coverage begins immediately if the application is approved. What kind of receipt was used? - Correct Ans: ✔✔Conditional
134. ABC Insurance Company has accepted a life insurance application which contains unanswered questions. The company

then makes the application part of the life contract. In this situation, the insurer has - Correct Ans: ✔✔waived one of its legal rights

135. M has an insurance policy that also has an outstanding policy loan at the time of M's death. The insurer will deduct the outstanding loan balance from the: - Correct Ans: ✔✔policy proceeds
136. Which of the following actions is NOT possible with a Universal Life policy? - Correct Ans: ✔✔Premiums may be applied as a credit against income tax
137. Any changes made on an insurance application requires the initials of whom? - Correct Ans: ✔✔Applicant
138. The part of a life insurance policy guaranteed to be true is called a(n): - Correct Ans: ✔✔warranty
139. Under an Individual Disability policy in Florida, what is the minimum schedule of time in which claims must be made to an insured? - Correct Ans: ✔✔Monthly

140. The act of an insurance company publishing misleading information about its policy's provisions is called - Correct Ans: ✔✔false advertising
141. Which type of policy pays benefits to a policyholder covered under a Hospital Expense policy? - Correct Ans: ✔✔Reimbursement
142. In a life insurance policy, which provision states who may select policy options, designate and name a beneficiary, and be the recipient of any financial benefits from the policy? - Correct Ans: ✔✔Owner's Rights
143. The provision that defines to whom the insurer will pay benefits to is called: - Correct Ans: ✔✔Payment of Claims
144. How can an agent-in-charge have more than one location? - Correct Ans: ✔✔Only if the agent-in-charge is present when insurance activity occurs
145. On August 6, D submitted an application for a $50,000 Life Insurance policy and did not pay the initial premium, On August 18, D went to his doctor complaining of chest pains and some tests were given by the doctor. The life policy was delivered by the producer on August 20 and D explains what had recently taken place with the doctor. What action should the producers