Florida Insurance Laws Flashcards
59 Questions
100 Views

Choose a study mode

Play Quiz
Study Flashcards
Spaced Repetition
Chat to lesson

Podcast

Play an AI-generated podcast conversation about this lesson

Questions and Answers

An individual covered under a Group Life insurance policy is considered to be a(n)

certificate holder

The act of an insurance company publishing misleading information about its policy's provisions is called

false advertising

Which of the following employer tasks does a Professional Employer Organization normally handle?

administration functions

According to Florida's rules on disclosure, a life insurance applicant is expected to be provided with

<p>a Buyer's Guide and Policy Summary</p> Signup and view all the answers

An example of an unfair claims settlement practice is

<p>turning down a claim without providing the basis of denial</p> Signup and view all the answers

Under Florida law, a variable annuity policyowner must be notified of the accumulated value of the contract

<p>once each year</p> Signup and view all the answers

What could an agent be found guilty of if he tells a claimant that his rights might be impaired if he does not complete a release form within a specified time?

<p>Coercion</p> Signup and view all the answers

According to Florida's life insurance replacement laws, a policyowner must be provided with a written Comparison and Summary Statement when it's requested by

<p>the policyowner</p> Signup and view all the answers

The Life and Health Insurance Guaranty Association is

<p>funded by admitted insurance companies through assessments</p> Signup and view all the answers

The Bureau of Unclaimed Property is overseen by the

<p>Chief Financial Officer</p> Signup and view all the answers

What is J guilty of if he induced an insured through misrepresentation to surrender an existing insurance policy?

<p>Twisting</p> Signup and view all the answers

Which document must an agent submit to the replacing insurance company during the replacement of an existing life insurance policy?

<p>Notice to existing and replacing insurers of intention to replace</p> Signup and view all the answers

What corrective action would the Department of Financial Services likely order K to take after making an improper sale of an annuity?

<p>Pay monetary restitution to the client</p> Signup and view all the answers

An insurance company can contest a life insurance contract due to application fraud within how many years?

<p>2 years</p> Signup and view all the answers

In Florida, what is the maximum percentage of controlled business an agent may produce?

<p>50%</p> Signup and view all the answers

Within how many days must a licensee notify the Department of Financial Services of a change in address?

<p>30</p> Signup and view all the answers

Which professional organization's code of ethics is incorporated into Florida law?

<p>National Association of Insurance and Financial Advisors (NAIFA)</p> Signup and view all the answers

How can an agent-in-charge have more than one location?

<p>Only if the agent-in-charge is present when insurance activity occurs</p> Signup and view all the answers

An insurance company incorporated under the laws of the state in which its home office is located is called a(n) ____ company.

<p>domestic</p> Signup and view all the answers

Which Unfair Trade Practice involves an agent telling a prospective client that a policy's dividends are guaranteed?

<p>Misrepresentation</p> Signup and view all the answers

In Florida, agents are allowed to engage in rebating if

<p>offered to all insureds in the same actuarial class</p> Signup and view all the answers

Agents that have been licensed for less than six years must complete how many hours of continuing education every two years?

<p>24</p> Signup and view all the answers

What is the main difference between a mutual insurance company and a stock insurance company?

<p>A stock company is owned by its shareholders. A mutual company is owned by its policyholders.</p> Signup and view all the answers

Which of the following situations does NOT apply to the Florida Replacement Rule? (Select all that apply)

<p>An existing policyholder purchases an additional policy from the same insurer</p> Signup and view all the answers

An example of an unfair claims practice would be?

<p>Failing to effectuate prompt, fair, and equitable settlements of a claim.</p> Signup and view all the answers

What is an insurer incorporated in Florida called?

<p>Domestic company</p> Signup and view all the answers

Which of the following is NOT considered rebating? (Select all that apply)

<p>Sharing commissions with an agent licensed in the same line of business</p> Signup and view all the answers

Which of the following is NOT a consequence for placing business with an unauthorized insurer? (Select all that apply)

<p>First degree misdemeanor</p> Signup and view all the answers

In Florida, a health policy that is paid on a quarterly basis requires a grace period of?

<p>31 days</p> Signup and view all the answers

If an agent makes a false or incomplete statement during an insurance transaction, he/she could be found guilty of?

<p>Misrepresentation</p> Signup and view all the answers

What is the purpose of the coordination of benefits (COB) provision?

<p>Avoid duplication of benefit payments</p> Signup and view all the answers

When recommending changes to existing coverage in Florida, what rule must agents follow?

<p>Florida Replacement Rule</p> Signup and view all the answers

When is a Group Health policy required to provide coverage for a newborn child?

<p>At the moment of birth</p> Signup and view all the answers

What is Florida's definition of life insurance replacement?

<p>A transaction in which a new policy is bought and an old policy is terminated.</p> Signup and view all the answers

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

<p>Small group benefit plans are to be issued on a 'guarantee-issue' basis.</p> Signup and view all the answers

What do families covered by the Florida Healthy Kids Corporation pay?

<p>A portion of the premium</p> Signup and view all the answers

When replacing or exchanging an annuity, what must the agent disclose to the annuitant?

<p>The possible tax ramifications as a result of the transaction.</p> Signup and view all the answers

Which two entities regulate variable annuities?

<p>Department of Financial Services and the Securities Exchange Commission.</p> Signup and view all the answers

What is the required minimum percentage of employee participation for a noncontributory group health insurance plan according to Florida Law?

<p>0%</p> Signup and view all the answers

Group Life policies in Florida are required to contain a conversion privilege that allows for conversion to what?

<p>An individual policy for a stated period of time.</p> Signup and view all the answers

How many days after a covered loss must a person insured under a health policy give the insurance company a Notice of Claim?

<p>Twenty</p> Signup and view all the answers

What are adjustable rates for life policy loans in Florida based on?

<p>Moody's corporate bond index</p> Signup and view all the answers

Florida requires that coverage for newborns begins from when?

<p>The moment of birth.</p> Signup and view all the answers

What action may result in the suspension of an agent's license?

<p>Acting with fiduciary responsibility.</p> Signup and view all the answers

According to Florida law, a life insurance policy loan cannot charge a fixed rate of interest higher than?

<p>10%</p> Signup and view all the answers

What is one definition of unfair discrimination?

<p>Offering different terms of coverage for different policyowners having the same risk classification.</p> Signup and view all the answers

What entity must authorize domestic, foreign, or alien insurance companies to conduct business?

<p>The state where they are conducting business.</p> Signup and view all the answers

What is the purpose of the Life and Health Insurance Guaranty Association?

<p>Protects policyowners against insolvent insurance companies.</p> Signup and view all the answers

What should an insurer provide to a prospective buyer?

<p>Buyer's Guide and Policy Summary.</p> Signup and view all the answers

What type of insurance company allows their policyowners to elect a governing body?

<p>Mutual.</p> Signup and view all the answers

What is the minimum age at which a person can sign a life insurance application?

<p>15 years.</p> Signup and view all the answers

What is coercion in the context of insurance?

<p>A bank requiring the borrower to purchase credit insurance from a specific company.</p> Signup and view all the answers

What is Florida's contestability period for most life insurance policies?

<p>2 years.</p> Signup and view all the answers

Which unfair trade practice involves an agent making malicious statements about another person's financial condition?

<p>Defamation.</p> Signup and view all the answers

What must be done when a Group Life policy is canceled?

<p>All of the employees must be notified of the cancellation either by the insurance company or through the policyholder.</p> Signup and view all the answers

What is sliding in the context of insurance sales?

<p>Charging for an additional product without the applicant's consent.</p> Signup and view all the answers

What is the waiting period for a pre-existing condition under a Medicare Supplement policy?

<p>6 months.</p> Signup and view all the answers

In Florida, which of the following information does NOT need to be obtained by an agent recommending an annuity purchase?

<p>Marital status.</p> Signup and view all the answers

What are nonforfeiture options primarily used for in insurance?

<p>To protect policyholders from losing their benefits.</p> Signup and view all the answers

Study Notes

Insurance Companies

  • Mutual insurance companies are owned by policyholders, while stock insurance companies are owned by shareholders.
  • An alien insurance company is one incorporated in another country but conducts business in Florida.

Florida Replacement Rule

  • The rule stipulates procedures must be followed when replacing existing insurance policies.
  • A new policy issued while surrendering an existing one triggers the rule, unlike purchasing an additional policy from the same insurer.
  • The agent must provide a Comparison and Summary Statement upon request from the policyholder for replacements.

Claims Practices

  • Unfair claims practices include failing to provide prompt, fair settlements or denying claims without explaining the basis for denial.
  • Misrepresentation during insurance transactions can lead to serious legal consequences, including fines or license suspensions.

Health Insurance Provisions

  • Health policies in Florida require a grace period of 31 days for payments made quarterly.
  • Group Health policies must cover newborns immediately at birth.
  • Florida requires small group health plans to be guaranteed-issue, ensuring coverage without underwriting restrictions.

Insurance Transactions

  • Issuing an insurance contract is a key element of an insurance transaction.
  • Misleading statements leading to policy terminations form a practice called "twisting," which is prohibited.

Policyholder Rights and Regulations

  • The Life and Health Insurance Guaranty Association protects policyowners against insurer insolvencies and is funded by assessments from admitted insurers.
  • Nonforfeiture options allow policyholders to retain some benefits if they stop making premium payments, while the Automatic Premium Loan Option is not recognized as a nonforfeiture option.

Licensing and Compliance

  • An agent must renew their license frequently, completing 24 hours of continuing education every two years.
  • Actions such as writing controlled business or performing transactions without a license can lead to license suspensions or revocations.
  • Definitions include "controlled business," which refers to policies written on the agent's own interests, and "defamation," which involves making false statements to harm another insurer’s reputation.
  • Insurance policy conversion privileges allow individuals to switch to individual policies without needing proof of insurability.

Consumer Protection and Disclosure

  • Agents must provide potential clients with a Buyer's Guide and Policy Summary to aid informed purchasing decisions.
  • Advertising gifts to prospective clients cannot exceed $25, ensuring ethical promotional practices.

Special Cases and Provisions

  • For an Individual Disability policy, claims must be paid out monthly.
  • Variable annuities must notify policyholders of accumulated values annually.
  • Under Florida law, handicapped children can continue coverage if they are dependent on the policyowner, but premiums must still be paid to maintain coverage.

Unfair Trade Practices

  • Unfair practices include coercion, such as inducing policy purchases by threatening loss of rights, and sliding, which is selling unnecessary additional coverage without consent.

Miscellaneous Regulations

  • A group life policy in Florida has no minimum insured requirement and allows for conversion to individual policies.
  • Nonprofit life insurance providers fall under a special category, termed fraternal life insurance organizations, and contribute to community welfare.### Insurance Concepts and Regulations
  • Twisting refers to the unethical practice of persuading a policyholder to replace an existing insurance policy with a new one for the agent's benefit.

Life Insurance Replacement Requirements

  • Agents must submit a notice to both existing and replacing insurers when replacing an existing life insurance policy.

Agent Accountability

  • K, an agent involved in improper annuity sales, could be ordered by the Department of Financial Services to pay monetary restitution to the affected client.

Application Fraud Limits

  • An insurance company has a two-year period to contest a life insurance contract on grounds of application fraud.

Controlled Business Regulations

  • In Florida, the maximum percentage of controlled business an agent may produce is 50%.

Licensee Notification Requirements

  • Licensees are required to notify the Department of Financial Services of any change in address within 30 days.

Code of Ethics in Florida

  • The code of ethics established by the National Association of Insurance and Financial Advisors (NAIFA) is incorporated into Florida law, guiding agent conduct.

Agent Presence at Multiple Locations

  • An agent-in-charge can operate more than one location only if present during insurance activities.

Domestic Insurance Companies

  • A domestic insurance company is one that is incorporated under the laws of the state where its home office is located.

Unfair Trade Practices

  • Misrepresentation is defined as an agent falsely stating that a policy's dividends are guaranteed to potential clients.

Rebating Practices

  • In Florida, agents can engage in rebating as long as it is offered equally to all insureds within the same actuarial class.

Continuing Education for Agents

  • Agents licensed for fewer than six years are required to complete 24 hours of continuing education every two years.

Studying That Suits You

Use AI to generate personalized quizzes and flashcards to suit your learning preferences.

Quiz Team

Description

Test your knowledge on Florida laws and rules related to insurance with these flashcards. Learn about the differences between mutual and stock insurance companies and the specific regulations that govern replacement rules in Florida. Perfect for aspiring insurance professionals!

More Like This

Use Quizgecko on...
Browser
Open
Browser
Browser