Florida Health Insurance
Licensing Exam
1. What is the term for an unplanned, unforeseen event which occurs suddenly and at an
unspecified place?
A. Hazard
B. Accident
C. Exposure
D. Emergency
Correct Answer: B
Rationale: An accident is specifically defined as an unplanned, unforeseen event that occurs
suddenly and at an unspecified place.
2. A policy that pays a specified benefit if the insured dies, loses sight, or loses two limbs due to
an unplanned traumatic injury is known as:
A. Disability Income Insurance
B. Accidental Death and Dismemberment
C. Basic Medical Expense Insurance
D. Specified Disease Policy
Correct Answer: B
Rationale: Accidental Death and Dismemberment insurance pays a benefit for death, loss of
sight, or loss of two limbs specifically due to an accident.
,3. Which of the following best describes a contract offered on a "take-it-or-leave-it" basis, where
any ambiguities are settled in favor of the insured?
A. Aleatory Contract
B. Conditional Contract
C. Contract of Adhesion
D. Consideration Contract
Correct Answer: C
Rationale: A contract of adhesion is offered by one party (the insurer) to another (the insured)
on a "take-it-or-leave-it" basis, and ambiguities are interpreted in favor of the party that did not
write the contract.
4. The tendency of individuals with a higher probability of loss to seek insurance more often than
those with a lower probability is known as:
A. Moral Hazard
B. Adverse Selection
C. Coercion
D. Consideration
Correct Answer: B
Rationale: Adverse selection is the tendency for higher-risk individuals to purchase and
maintain insurance more frequently than those who present a lower risk.
5. An insurance contract is considered aleatory because:
, A. It is a contract of adhesion.
B. The parties involved exchange unequal amounts.
C. It requires both parties to perform certain duties.
D. It is enforceable by law.
Correct Answer: B
Rationale: An aleatory contract involves an exchange of unequal amounts. In insurance, the
premiums paid by the insured are unequal to the potential benefit paid by the insurer in the event
of a loss.
6. What is the method for determining primary coverage for a dependent child when both parents
have health insurance?
A. Coordination of Benefits
B. The Birthday Rule
C. Eligibility Period Rule
D. Gatekeeper Model
Correct Answer: B
Rationale: The Birthday Rule states that the plan of the parent whose birthday occurs first in the
calendar year is designated as the primary coverage for the dependent child.
7. Which federal law provides for the continuation of group health coverage for employees and
their dependents after a qualifying event like job loss or divorce?
A. Fair Credit Reporting Act
B. Consolidated Omnibus Budget Reconciliation Act (COBRA) of 1985
Licensing Exam
1. What is the term for an unplanned, unforeseen event which occurs suddenly and at an
unspecified place?
A. Hazard
B. Accident
C. Exposure
D. Emergency
Correct Answer: B
Rationale: An accident is specifically defined as an unplanned, unforeseen event that occurs
suddenly and at an unspecified place.
2. A policy that pays a specified benefit if the insured dies, loses sight, or loses two limbs due to
an unplanned traumatic injury is known as:
A. Disability Income Insurance
B. Accidental Death and Dismemberment
C. Basic Medical Expense Insurance
D. Specified Disease Policy
Correct Answer: B
Rationale: Accidental Death and Dismemberment insurance pays a benefit for death, loss of
sight, or loss of two limbs specifically due to an accident.
,3. Which of the following best describes a contract offered on a "take-it-or-leave-it" basis, where
any ambiguities are settled in favor of the insured?
A. Aleatory Contract
B. Conditional Contract
C. Contract of Adhesion
D. Consideration Contract
Correct Answer: C
Rationale: A contract of adhesion is offered by one party (the insurer) to another (the insured)
on a "take-it-or-leave-it" basis, and ambiguities are interpreted in favor of the party that did not
write the contract.
4. The tendency of individuals with a higher probability of loss to seek insurance more often than
those with a lower probability is known as:
A. Moral Hazard
B. Adverse Selection
C. Coercion
D. Consideration
Correct Answer: B
Rationale: Adverse selection is the tendency for higher-risk individuals to purchase and
maintain insurance more frequently than those who present a lower risk.
5. An insurance contract is considered aleatory because:
, A. It is a contract of adhesion.
B. The parties involved exchange unequal amounts.
C. It requires both parties to perform certain duties.
D. It is enforceable by law.
Correct Answer: B
Rationale: An aleatory contract involves an exchange of unequal amounts. In insurance, the
premiums paid by the insured are unequal to the potential benefit paid by the insurer in the event
of a loss.
6. What is the method for determining primary coverage for a dependent child when both parents
have health insurance?
A. Coordination of Benefits
B. The Birthday Rule
C. Eligibility Period Rule
D. Gatekeeper Model
Correct Answer: B
Rationale: The Birthday Rule states that the plan of the parent whose birthday occurs first in the
calendar year is designated as the primary coverage for the dependent child.
7. Which federal law provides for the continuation of group health coverage for employees and
their dependents after a qualifying event like job loss or divorce?
A. Fair Credit Reporting Act
B. Consolidated Omnibus Budget Reconciliation Act (COBRA) of 1985
