Florida Insurance Verified Multiple Choice and Conceptual Actual Emended Exam
Questions With Reviewed 100% Correct Detailed Answers
Guaranteed Pass!!Current Update
In the insurance business, risk can best
be defined as:
C. The concept of insurance developed
A. sharing the possibility of a loss from the need to minimize the adverse
B. uncertainty regarding the future effects of risk associated with the proba-
C. uncertainty regarding financial loss bility of financial loss.
D. uncertainty regarding when death will
occur
Which of the following risks is insurable? A. Only pure risks are insurable because
they involve only the chance of loss. They
A. pure risks are pure in the sense that they do not
B. gambling mix both profits and losses. Insurance is
C. speculative risks concerned with the economic problems
D. investing created by pure risks.
Buying insurance is one of the most ef-
B. Buying insurance is one of the most ef-
fective ways of
fective ways of transferring risk. Through
the insurance contract, the burden of car-
A. avoiding risk
rying the risk and indemnifying the finan-
B. transferring risk
cial loss is transferred from the individual
C. reducing risk
to the insurance company.
D. retaining risk
Which of the following best describes the
function of insurance?
B. The function of insurance is to safe-
A. it is a form of legalized gambling.
guard against financial loss by having the
B. it spreads financial risk over a large
losses of few paid by the contributions of
group to minimize the loss to any one
many who are exposed to the same risk.
individual
C. it protects against living too long
D. it creates and protects risks
C. One of the criteria for an insurable risk
All of the following are elements of an
is that it NOT be catastrophic. A princi-
insurable risk EXCEPT
ple of insurance holds that only a small
portion of a given group will experience
A. the loss must be due to chance
loss at any one time. Risks that would
B. the loss must be predictable
adversely affect large numbers of peo-
C. the loss must be catastrophic
ple or large amounts of property - wars
, Florida Insurance Verified Multiple Choice and Conceptual Actual Emended Exam
Questions With Reviewed 100% Correct Detailed Answers
Guaranteed Pass!!Current Update
D. the loss must have a determinable or floods, for example - are typically not
value insurable.
The amount of money an insurer sets
B. Reserves can be defined as the
aside to pay future claims is called
amounts that are set aside to fulfill the
insurance company's obligation to pay
A. a premium
future claims. The reserve is compiled
B. a reserve
from past premium payments and inter-
C. a dividend
est.
D. an accumulated interest
Which of the following constitutes an in-
surable interest?
A. the policyowner must expect to benefit
from the insured's death B. Insurable interest requires the policy-
B. the policyowner must expect to suffer owner to benefit from the insured's con-
a loss when the insured dies or becomes tinuing to live or enjoy good health or to
disabled suffer a loss when the insured dies or is
C. the beneficiary, by definition, has an disabled.
insurable interest in the insured
D. the insured must have a personal or
business relationship with the beneficia-
ry
Which of the following statements de-
scribes the parol evidence rule?
C. The parol evidence rule states that
A. a written contract cannot be changed
when parties put their agreement in writ-
once it is signed
ing, all previous verbal statements come
B. an oral contract cannot be modified by
together in that writing, and a written con-
written evidence
tract cannot be changed or modified by
C. a written contract cannot be changed
parol (oral) evidence.
by oral evidence
D. an oral contract takes precedence
over any earlier written contract
Which of the following factors deter-
mines whether policy dividends will be
paid on a participating policy?
A. reserves and experience
, Florida Insurance Verified Multiple Choice and Conceptual Actual Emended Exam
Questions With Reviewed 100% Correct Detailed Answers
Guaranteed Pass!!Current Update
B. expenses and claims costs B. If expenses and claims costs are less
C. interest and benefits than expected, dividends are likely to be
D. premiums and renewability paid.
A licensed agent legally represents
A. An agent is an individual who has
A. the insurer been authorized by an insurer to be its
B. the applicant/insured representative to the public and to offer
C. the state insurance department for sale its goods and services.
D. himself or herself
All of the following statements regarding
policy replacement are correct EXCEPT
A. replacement involves convincing a
policyholder to lapse or terminate an ex-
isting policy and to purchase another
B. interrupting one cash value insurance
plan to begin another could cause seri- D. The new policy will probably be at
ous financial problems for the policyown- a higher premium rate because it will
er be based on the insured's then-attained
C. even if the customer wants to replace age.
his or her existing policy, an agent can ef-
fect a policy replacement only by follow-
ing the replacement regulations in the
agent's state
D. premiums for the replacement policies
are generally lower than premiums for
the existing policies they replace
With regard to insurable risks, which of
the following statements is NOT correct?
A. only pure risks are insurable B. To be insurable, a risk must involve
B. an insurable risk must involve loss that the chance of loss that is fortuitous and
is within the insured's control outside the insured's control.
C. insurers will not insure risks that are
catastrophic in nature
D. an insurable risk must be measurable
On August 9, Albert made an application
for life insurance that his agent submitted
Questions With Reviewed 100% Correct Detailed Answers
Guaranteed Pass!!Current Update
In the insurance business, risk can best
be defined as:
C. The concept of insurance developed
A. sharing the possibility of a loss from the need to minimize the adverse
B. uncertainty regarding the future effects of risk associated with the proba-
C. uncertainty regarding financial loss bility of financial loss.
D. uncertainty regarding when death will
occur
Which of the following risks is insurable? A. Only pure risks are insurable because
they involve only the chance of loss. They
A. pure risks are pure in the sense that they do not
B. gambling mix both profits and losses. Insurance is
C. speculative risks concerned with the economic problems
D. investing created by pure risks.
Buying insurance is one of the most ef-
B. Buying insurance is one of the most ef-
fective ways of
fective ways of transferring risk. Through
the insurance contract, the burden of car-
A. avoiding risk
rying the risk and indemnifying the finan-
B. transferring risk
cial loss is transferred from the individual
C. reducing risk
to the insurance company.
D. retaining risk
Which of the following best describes the
function of insurance?
B. The function of insurance is to safe-
A. it is a form of legalized gambling.
guard against financial loss by having the
B. it spreads financial risk over a large
losses of few paid by the contributions of
group to minimize the loss to any one
many who are exposed to the same risk.
individual
C. it protects against living too long
D. it creates and protects risks
C. One of the criteria for an insurable risk
All of the following are elements of an
is that it NOT be catastrophic. A princi-
insurable risk EXCEPT
ple of insurance holds that only a small
portion of a given group will experience
A. the loss must be due to chance
loss at any one time. Risks that would
B. the loss must be predictable
adversely affect large numbers of peo-
C. the loss must be catastrophic
ple or large amounts of property - wars
, Florida Insurance Verified Multiple Choice and Conceptual Actual Emended Exam
Questions With Reviewed 100% Correct Detailed Answers
Guaranteed Pass!!Current Update
D. the loss must have a determinable or floods, for example - are typically not
value insurable.
The amount of money an insurer sets
B. Reserves can be defined as the
aside to pay future claims is called
amounts that are set aside to fulfill the
insurance company's obligation to pay
A. a premium
future claims. The reserve is compiled
B. a reserve
from past premium payments and inter-
C. a dividend
est.
D. an accumulated interest
Which of the following constitutes an in-
surable interest?
A. the policyowner must expect to benefit
from the insured's death B. Insurable interest requires the policy-
B. the policyowner must expect to suffer owner to benefit from the insured's con-
a loss when the insured dies or becomes tinuing to live or enjoy good health or to
disabled suffer a loss when the insured dies or is
C. the beneficiary, by definition, has an disabled.
insurable interest in the insured
D. the insured must have a personal or
business relationship with the beneficia-
ry
Which of the following statements de-
scribes the parol evidence rule?
C. The parol evidence rule states that
A. a written contract cannot be changed
when parties put their agreement in writ-
once it is signed
ing, all previous verbal statements come
B. an oral contract cannot be modified by
together in that writing, and a written con-
written evidence
tract cannot be changed or modified by
C. a written contract cannot be changed
parol (oral) evidence.
by oral evidence
D. an oral contract takes precedence
over any earlier written contract
Which of the following factors deter-
mines whether policy dividends will be
paid on a participating policy?
A. reserves and experience
, Florida Insurance Verified Multiple Choice and Conceptual Actual Emended Exam
Questions With Reviewed 100% Correct Detailed Answers
Guaranteed Pass!!Current Update
B. expenses and claims costs B. If expenses and claims costs are less
C. interest and benefits than expected, dividends are likely to be
D. premiums and renewability paid.
A licensed agent legally represents
A. An agent is an individual who has
A. the insurer been authorized by an insurer to be its
B. the applicant/insured representative to the public and to offer
C. the state insurance department for sale its goods and services.
D. himself or herself
All of the following statements regarding
policy replacement are correct EXCEPT
A. replacement involves convincing a
policyholder to lapse or terminate an ex-
isting policy and to purchase another
B. interrupting one cash value insurance
plan to begin another could cause seri- D. The new policy will probably be at
ous financial problems for the policyown- a higher premium rate because it will
er be based on the insured's then-attained
C. even if the customer wants to replace age.
his or her existing policy, an agent can ef-
fect a policy replacement only by follow-
ing the replacement regulations in the
agent's state
D. premiums for the replacement policies
are generally lower than premiums for
the existing policies they replace
With regard to insurable risks, which of
the following statements is NOT correct?
A. only pure risks are insurable B. To be insurable, a risk must involve
B. an insurable risk must involve loss that the chance of loss that is fortuitous and
is within the insured's control outside the insured's control.
C. insurers will not insure risks that are
catastrophic in nature
D. an insurable risk must be measurable
On August 9, Albert made an application
for life insurance that his agent submitted
