Florida 240 License 2026
Exam Questions and Verified
Answers | Already Graded A+
The stated amount or percent of liquid assets that an insurer must have on
hand that will satisfy future obligations to its policyholders is called: -
🧠ANSWER ✔✔Reserves
An insurance applicant MUST be informed of an investigation regarding
his/her reputation and character according to the: - 🧠ANSWER ✔✔Fair
Credit Reporting Act
,A nonprofit incorporated society that does not have capital stock and
operates for the sole benefit of its members is known as: - 🧠ANSWER ✔✔A
fraternal benefit society
What I the name of the law that requires insurers to disclose information
gathering practices and where the information was obtained? - 🧠ANSWER
✔✔Fair Credit Reporting Act
Who elects the governing body of a mutual insurance company? -
🧠ANSWER ✔✔Policyholders
A group-owned insurance company that is formed to assume and spread
the liability ricks of its members is known as a: - 🧠ANSWER ✔✔Risk
retention group
What type of reinsurance contract involves two companies automatically
sharing their risk exposure? - 🧠ANSWER ✔✔treaty
What year was the McCarran-Ferguson Act enacted? - 🧠ANSWER
✔✔1945
Which of these describe a participating life insurance policy? - 🧠ANSWER
✔✔Policy owners are entitled to receive dividends
,At what point must a life insurance applicant be informed of their rights that
fall under the Fair Credit Reporting Act? - 🧠ANSWER ✔✔Upon completion
of the application
Which of the following requires insurers to disclose when an applicant's
consumer or credit history is being investigated: - 🧠ANSWER ✔✔1970 -
Fair Credit Reporting Act
What type of reinsurance contract involves two companies automatically
sharing their risk exposure? - 🧠ANSWER ✔✔Treaty
A group-owned insurance company that is formed to assume and spread
the liability risks of its members is known as a: - 🧠ANSWER ✔✔risk
retention group
All of the following are considered to be typical characteristics describing
the nature of an insurance contract, EXCEPT: - 🧠ANSWER ✔✔Bilateral
The part of a life insurance policy guaranteed to be true is called a(n) -
🧠ANSWER ✔✔warranty
Statements made on an insurance application that are believed to be true
to the best of the applicant's knowledge are called - 🧠ANSWER
✔✔representations
3
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2026. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
STATEMENT. ALL RIGHTS RESERVED
, 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
When must insurable interest be present in order for a life insurance policy
to be valid? - 🧠ANSWER ✔✔When the application is made
A life insurance arrangement which circumvents insurable interest statutes
is called: - 🧠ANSWER ✔✔Investor-Originated Life Insurance
Stranger Originated Life Insurance (STOLI) has been found to be in
violation of which of the following contractual elements? - 🧠ANSWER
✔✔Legal Purpose (Insurable Interest)
Who makes the legally enforceable promises in a unilateral contract? -
🧠ANSWER ✔✔Insurance company
A policy of adhesion can only be modified by whom? - 🧠ANSWER
✔✔insurance company
Exam Questions and Verified
Answers | Already Graded A+
The stated amount or percent of liquid assets that an insurer must have on
hand that will satisfy future obligations to its policyholders is called: -
🧠ANSWER ✔✔Reserves
An insurance applicant MUST be informed of an investigation regarding
his/her reputation and character according to the: - 🧠ANSWER ✔✔Fair
Credit Reporting Act
,A nonprofit incorporated society that does not have capital stock and
operates for the sole benefit of its members is known as: - 🧠ANSWER ✔✔A
fraternal benefit society
What I the name of the law that requires insurers to disclose information
gathering practices and where the information was obtained? - 🧠ANSWER
✔✔Fair Credit Reporting Act
Who elects the governing body of a mutual insurance company? -
🧠ANSWER ✔✔Policyholders
A group-owned insurance company that is formed to assume and spread
the liability ricks of its members is known as a: - 🧠ANSWER ✔✔Risk
retention group
What type of reinsurance contract involves two companies automatically
sharing their risk exposure? - 🧠ANSWER ✔✔treaty
What year was the McCarran-Ferguson Act enacted? - 🧠ANSWER
✔✔1945
Which of these describe a participating life insurance policy? - 🧠ANSWER
✔✔Policy owners are entitled to receive dividends
,At what point must a life insurance applicant be informed of their rights that
fall under the Fair Credit Reporting Act? - 🧠ANSWER ✔✔Upon completion
of the application
Which of the following requires insurers to disclose when an applicant's
consumer or credit history is being investigated: - 🧠ANSWER ✔✔1970 -
Fair Credit Reporting Act
What type of reinsurance contract involves two companies automatically
sharing their risk exposure? - 🧠ANSWER ✔✔Treaty
A group-owned insurance company that is formed to assume and spread
the liability risks of its members is known as a: - 🧠ANSWER ✔✔risk
retention group
All of the following are considered to be typical characteristics describing
the nature of an insurance contract, EXCEPT: - 🧠ANSWER ✔✔Bilateral
The part of a life insurance policy guaranteed to be true is called a(n) -
🧠ANSWER ✔✔warranty
Statements made on an insurance application that are believed to be true
to the best of the applicant's knowledge are called - 🧠ANSWER
✔✔representations
3
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2026. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
STATEMENT. ALL RIGHTS RESERVED
, 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
When must insurable interest be present in order for a life insurance policy
to be valid? - 🧠ANSWER ✔✔When the application is made
A life insurance arrangement which circumvents insurable interest statutes
is called: - 🧠ANSWER ✔✔Investor-Originated Life Insurance
Stranger Originated Life Insurance (STOLI) has been found to be in
violation of which of the following contractual elements? - 🧠ANSWER
✔✔Legal Purpose (Insurable Interest)
Who makes the legally enforceable promises in a unilateral contract? -
🧠ANSWER ✔✔Insurance company
A policy of adhesion can only be modified by whom? - 🧠ANSWER
✔✔insurance company
