FLORIDA INSURANCE EXAM (2-15) QUESTIONS
AND ACTUAL ANSWERS.
Which of these statements about foreign insurers in Florida is TRUE? ANS -A foreign insurer can usually
only issue insurance to someone who was denied coverage by domestic insurers.
The Commissioner of Insurance Regulation oversees the Office of Insurance Regulation. Which of the
following is NOT one of the functions of the OIR? ANS -Overseeing licensing of all adjusters in the state
of Florida.
Which of the following is NOT true about the National Association of Insurance Commissioners? ANS -It
provides benefits for insurance commissioners
Jill wants to start an insurance agency selling property insurance. As such, she must belong to a
Guaranty Association, of which there are a few different types. Which of these groups would best fit Jill's
needs? ANS -Florida Insurance Guaranty Association
In 1945 Congress passed the McCarran-Ferguson Act. What does that act do? ANS -The McCarran-
Ferguson Act opened the way for states to govern the insurance industry.
The Insurance Guaranty Association is a mechanism that covers claims in the event of: ANS -an
insurer's insolvency.
Guaranty Associations are funded by: ANS -insurers.
Rachel is starting an insurance company in Naples, Florida. She has a great business model and has
begun recruiting some fantastic sales people. In addition to submitting to occasional financial audits in
the future, Rachel's company must also: ANS -become a member of a Guaranty Association.
Risk retention groups do NOT: ANS -have the support of state Guaranty Funds.
Which of the following is NOT one of the roles of the Florida Department of Financial Services? ANS -
Licensing and regulating insurance companies
,Which of the following is NOT a rating factor for a personal auto liability policy? ANS -The condition of
the vehicle
*The main purpose of an Insurance Guaranty Association is: ANS -to make sure that insurers are able to
pay claims, even in the event of an insolvency.
Which of the following would NOT affect the rating for comprehensive and collision coverage on a
vehicle? ANS -The color
Loggers, roofers, and coal miners would fall into which of the following categories? ANS -High-risk
employees
Addie lives in Texas, a state that is reciprocal with Florida CE when it comes to licensing adjusters. Addie
has a license in her home state as well as a license in Florida. How much continuing education does
Addie need to complete in order to renew her license in Florida? ANS -Since Addie is not a resident
adjuster in Florida, she simply needs to stay compliant in her own state in order to be able to renew her
non-resident license in Florida.
Mervyn is from Kansas, a state that does not license insurance adjusters. Which of the following is
TRUE? ANS -If Mervyn wants to be licensed in Florida, he can designate Florida as his home state, and
he must meet all the same requirements as a Florida adjuster.
Bill lives in a state which doesn't require adjuster licensing, but he wants to get a job in Florida as an
adjuster. He is confused about which state he should list as his home state, since his home state does
not actually license claims adjusters. Bill should list _______ as his home state. ANS -Florida
Eric works in Florida for Gemutlich Insurance. His company is licensed to sell insurance in Florida, but is
based out of Munich, Germany. Gemutlich Insurance was formed under German law, but follows all
applicable Florida laws and possesses a Florida Certificate of Authority to sell their product. Which type
of insurer does Eric work for? ANS -Alien Insurer
Greg was in the process of completing the CE for his Florida adjuster license when unforseen
circumstances made it necessary for him to drop everything and take care of his aging mother for a year.
,Now, Greg's license is about to expire and he does not have the CE credits he needs. What should he
do? ANS -Apply to the Department of Financial Services for an extension.
Florida Insurance Code states the qualifications required to become a licensed insurance adjuster in the
state of Florida. Which of the following is NOT one of the requirements for applicants? ANS -Spend 20
hours in the field working with a licensed insurance adjuster
During catastrophes, which of the following is TRUE? ANS -Adjusters licensed in other states can act as
emergency adjusters in Florida.
Ryan must complete continuing education courses before the deadline for his Florida license. He knows
it's important, but he has been putting off his coursework, and now the credits are overdue. Ryan is 8
hours short; what can he expect? ANS -Ryan will have to send a written request for an extension to the
Department of Financial Services.
An insurance adjuster in Florida must complete CE every ____ years. ANS -two
Which of the following would NOT result in disciplinary action from the Department of Financial Service
ANS -Accepting advance premiums
An emergency insurance adjuster license in the State of Florida is good for ____ days. ANS -180
Angie just got her adjuster license in Florida on May 11, 2016. Her birthday is March 10, 1983. When will
her license expire? ANS -Angie's license will only expire if she goes 4 years without an appointment.
Third Party Administrators: ANS -do not assume any risk for the policies they handle.
Which of the following is NOT a purpose of insurance regulation? ANS -To prohibit insurance-rating
When a company collects a consumer's personal and financial information, the methods for that
collection, as well as the ways in which the information is used and shared, are all regulated by the:
ANS -Fair Credit Reporting Act (FCRA).
, The set of patient privacy rules that all health care providers, insurance companies, physicians offices,
hospitals, and pharmacies must follow is called the _____________. ANS -HIPAA - Health Insurance
Portability and Accountability Act
The HIPAA was enacted by the US Congress in _________. ANS -1996
Under which law is an insurer required to explain its reasons for denying coverage? ANS -IIPPA
Which of the following is NOT one of the responsibilities of Florida's Chief Financial Officer? ANS -Act as
liaison between Florida and the federal government
Sherrie's roof and fence are damaged in a violent windstorm. Sherrie has a typical HO-3 policy with a
$150,000 limit for Coverage A - Dwelling. Assuming she has no endorsements, how much coverage does
she have available for the damage to her fence? ANS -10% of the coverage A limit
Which of the following does NOT apply to commercial property insurance? ANS -The Commercial policy
forms include the Basic and Broad Forms, which are named peril forms, and the Special Form, which is
an open peril ("all risk") form.
Francis owns a small shoe store. Since his business isn't particularly risky, he has a commercial property
policy that provides named-peril coverage to his building and personal property, without any additional
coverages. Which Causes of Loss form does Francis have attached to his coverage form? ANS -basic
form
Which of the following events would trigger the end to a commercial property Builders Risk Coverage
Form? ANS -building is accepted
In dwelling policies, Coverage D pays for: ANS -lost rental rate
Veronica owns a pottery business and is insured under a commercial property policy. She was in the
process of building an extra structure for the sole purpose of kiln firing her pottery when a massive
storm came through and blew down all the scaffolding, which added additional cost to the construction
project. Which coverage extension of the Builder's Risk Coverage Form would cover the scaffolding?
ANS -scaffolding, temporary properyty
AND ACTUAL ANSWERS.
Which of these statements about foreign insurers in Florida is TRUE? ANS -A foreign insurer can usually
only issue insurance to someone who was denied coverage by domestic insurers.
The Commissioner of Insurance Regulation oversees the Office of Insurance Regulation. Which of the
following is NOT one of the functions of the OIR? ANS -Overseeing licensing of all adjusters in the state
of Florida.
Which of the following is NOT true about the National Association of Insurance Commissioners? ANS -It
provides benefits for insurance commissioners
Jill wants to start an insurance agency selling property insurance. As such, she must belong to a
Guaranty Association, of which there are a few different types. Which of these groups would best fit Jill's
needs? ANS -Florida Insurance Guaranty Association
In 1945 Congress passed the McCarran-Ferguson Act. What does that act do? ANS -The McCarran-
Ferguson Act opened the way for states to govern the insurance industry.
The Insurance Guaranty Association is a mechanism that covers claims in the event of: ANS -an
insurer's insolvency.
Guaranty Associations are funded by: ANS -insurers.
Rachel is starting an insurance company in Naples, Florida. She has a great business model and has
begun recruiting some fantastic sales people. In addition to submitting to occasional financial audits in
the future, Rachel's company must also: ANS -become a member of a Guaranty Association.
Risk retention groups do NOT: ANS -have the support of state Guaranty Funds.
Which of the following is NOT one of the roles of the Florida Department of Financial Services? ANS -
Licensing and regulating insurance companies
,Which of the following is NOT a rating factor for a personal auto liability policy? ANS -The condition of
the vehicle
*The main purpose of an Insurance Guaranty Association is: ANS -to make sure that insurers are able to
pay claims, even in the event of an insolvency.
Which of the following would NOT affect the rating for comprehensive and collision coverage on a
vehicle? ANS -The color
Loggers, roofers, and coal miners would fall into which of the following categories? ANS -High-risk
employees
Addie lives in Texas, a state that is reciprocal with Florida CE when it comes to licensing adjusters. Addie
has a license in her home state as well as a license in Florida. How much continuing education does
Addie need to complete in order to renew her license in Florida? ANS -Since Addie is not a resident
adjuster in Florida, she simply needs to stay compliant in her own state in order to be able to renew her
non-resident license in Florida.
Mervyn is from Kansas, a state that does not license insurance adjusters. Which of the following is
TRUE? ANS -If Mervyn wants to be licensed in Florida, he can designate Florida as his home state, and
he must meet all the same requirements as a Florida adjuster.
Bill lives in a state which doesn't require adjuster licensing, but he wants to get a job in Florida as an
adjuster. He is confused about which state he should list as his home state, since his home state does
not actually license claims adjusters. Bill should list _______ as his home state. ANS -Florida
Eric works in Florida for Gemutlich Insurance. His company is licensed to sell insurance in Florida, but is
based out of Munich, Germany. Gemutlich Insurance was formed under German law, but follows all
applicable Florida laws and possesses a Florida Certificate of Authority to sell their product. Which type
of insurer does Eric work for? ANS -Alien Insurer
Greg was in the process of completing the CE for his Florida adjuster license when unforseen
circumstances made it necessary for him to drop everything and take care of his aging mother for a year.
,Now, Greg's license is about to expire and he does not have the CE credits he needs. What should he
do? ANS -Apply to the Department of Financial Services for an extension.
Florida Insurance Code states the qualifications required to become a licensed insurance adjuster in the
state of Florida. Which of the following is NOT one of the requirements for applicants? ANS -Spend 20
hours in the field working with a licensed insurance adjuster
During catastrophes, which of the following is TRUE? ANS -Adjusters licensed in other states can act as
emergency adjusters in Florida.
Ryan must complete continuing education courses before the deadline for his Florida license. He knows
it's important, but he has been putting off his coursework, and now the credits are overdue. Ryan is 8
hours short; what can he expect? ANS -Ryan will have to send a written request for an extension to the
Department of Financial Services.
An insurance adjuster in Florida must complete CE every ____ years. ANS -two
Which of the following would NOT result in disciplinary action from the Department of Financial Service
ANS -Accepting advance premiums
An emergency insurance adjuster license in the State of Florida is good for ____ days. ANS -180
Angie just got her adjuster license in Florida on May 11, 2016. Her birthday is March 10, 1983. When will
her license expire? ANS -Angie's license will only expire if she goes 4 years without an appointment.
Third Party Administrators: ANS -do not assume any risk for the policies they handle.
Which of the following is NOT a purpose of insurance regulation? ANS -To prohibit insurance-rating
When a company collects a consumer's personal and financial information, the methods for that
collection, as well as the ways in which the information is used and shared, are all regulated by the:
ANS -Fair Credit Reporting Act (FCRA).
, The set of patient privacy rules that all health care providers, insurance companies, physicians offices,
hospitals, and pharmacies must follow is called the _____________. ANS -HIPAA - Health Insurance
Portability and Accountability Act
The HIPAA was enacted by the US Congress in _________. ANS -1996
Under which law is an insurer required to explain its reasons for denying coverage? ANS -IIPPA
Which of the following is NOT one of the responsibilities of Florida's Chief Financial Officer? ANS -Act as
liaison between Florida and the federal government
Sherrie's roof and fence are damaged in a violent windstorm. Sherrie has a typical HO-3 policy with a
$150,000 limit for Coverage A - Dwelling. Assuming she has no endorsements, how much coverage does
she have available for the damage to her fence? ANS -10% of the coverage A limit
Which of the following does NOT apply to commercial property insurance? ANS -The Commercial policy
forms include the Basic and Broad Forms, which are named peril forms, and the Special Form, which is
an open peril ("all risk") form.
Francis owns a small shoe store. Since his business isn't particularly risky, he has a commercial property
policy that provides named-peril coverage to his building and personal property, without any additional
coverages. Which Causes of Loss form does Francis have attached to his coverage form? ANS -basic
form
Which of the following events would trigger the end to a commercial property Builders Risk Coverage
Form? ANS -building is accepted
In dwelling policies, Coverage D pays for: ANS -lost rental rate
Veronica owns a pottery business and is insured under a commercial property policy. She was in the
process of building an extra structure for the sole purpose of kiln firing her pottery when a massive
storm came through and blew down all the scaffolding, which added additional cost to the construction
project. Which coverage extension of the Builder's Risk Coverage Form would cover the scaffolding?
ANS -scaffolding, temporary properyty
