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Florida General Lines Agent Exam
questions and answers 2023/
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Answers are highlighted in red What is the definition of a risk that is insurable? a.Risk is defined as a chance or the possibility of financial loss; only pure risks are insurable as there is no possibility of a gain b.A chance of a loss or gain c.A risk where there is a possibility of a gain d.A chance for insurance coverage Answer a What is an insurance policy? a.A binder that offers initial insurance coverage b.An oral agreement related to insurance c.A temporary agreement for insurance coverage d.A written agreement or contract for insurance coverage Correct Answer . What is an insurance binder? a.An agreement with an insurer for coverage b.A temporary agreement for insurance coverage subject to the decision of the insurer Correct Answer c.A permanent agreement for insurance coverage d.An agreement with an agent The term casualty is related to all the following insurance lines except? a.Life and health insurance Correct Answer b.Marine insurance c.Insurance on property d.Liability insurance What is the mathematical concept where the actual results from an event being measured will equal the predicted or expected results as the number of units or trials increases?
Answer The concept of The Law of Large Numbers. What insurance principle acts to place an insured in the same or similar financial position after a loss as was prior to the loss event? a.The indemnity principle Correct Answer b.The waiver principle c.The principle of utmost good faith d.The principle of subrogation What type of contract prevents an insured from transferring the interest of an insurance policy to another? a.A personal contract Correct Answer b.An indemnity contract c.A subrogation contract d.A contract of good faith a What type of contract is one where the obligation of the insurer is to perform the terms of the contract and is based on the insured satisfying certain conditions? a.A binding contract b.A personal contract c.A conditional contract Correct Answer d.An adhesion contract What type of contract is it that the insured cannot negotiate the terms of the contract and must accept the terms specified in the contract? a.An indemnity contract b.A conditional contract c.A contract of adhesion Correct Answer d.A personal contract What type of interest (financial or legal) in property must an insured have to benefit from a loss that is insured? a.Insurable interest Correct Answer b.An adhesion interest c.An indemnity interest d.A personal interest
What insurance clause is related to a creditor's interest in personal property such as an auto? a.The property interest clause b.The mortgage or mortgagee clause c.The creditor interest clause d.The loss payable or loss payee clause Correct Answer Which of the following is not a legal requirement for a contract? a.All are legal requirements Correct Answer b.The contract must have a legal purpose and transfer of consideration (something of value such as payment of insurance premiums) c.There must be a valid offer and a voluntary acceptance d.The parties to the contract must have legal capacity to contract What insurance loss settlement method is defined as the cost to replace the item less allowance for depreciation, and is the common method used for settlement of personal property losses? a.Scheduled settlement method b.Valued or stated settlement method c.Actual cash value settlement method Correct Answer d.Replacement cost (RC) settlement method What insurance loss settlement method is defined as: the property loss is replaced with items that are similar and of like kind and quality, and is the common method used in settling real property losses? a.Replacement cost settlement method Correct Answer b.Actual cash value settlement method c.Scheduled settlement method d.Valued or stated settlement method a
What insurance settlement method is defined as: the insurer agrees in advance to pay the value of the property insured up to the coverage limits regardless of the property ACV or RC a.Actual cash value ACV settlement method b.Valued or stated settlement method Correct Answer c.Replacement cost (RC) settlement method d.Structured settlement method What settlement method is related to the price a willing buyer will pay for the property? The market value Answer The remaining value of property after a total loss is referred to as? Salvage value Answer The Florida law that states that an insured must pay the full coverage limits on property when there is a total loss is referred to as? Florida valued policy law Answer A property valued at $100,000 is insured for $56,000 on a property policy that has a coinsurance requirement of 80%. What amount of the loss is payable by the insurer if there is a loss of $20,000? The coinsurance formula is C / R x L where C is the amount of insurance CARRIED by the insured on the property. R is the amount of insurance coverage REQUIRED by the insurer based on the coinsurance requirement and L is the amount of the LOSS. The amount payable for the loss would be? loss would be $14,000 ($56,000 / $80,000 (80% of $100,000) x $20,000. Calculate the amount payable for a loss of $50,000 based on a property that is valued at $200,000 and the property is insured for $120,000 on a policy that requires a coinsurance amount of 80%? a.$37,500 ($120,000 / $160,000 (80% of $200,000) x $50,000) Correct Answer b.$10,000 (20% of $50,000) c.$50,000 (100% of $50,000) d.$40,000 (80% of $50,000)
A policy with one limit that would apply to all losses that occur during the policy period would be considered as what type of liability limit? aggregate limit of liability Answer Liability insurance only pays for? monetary damages,Remember liability insurance does not cover punitive damages which are damages a court may impose on someone due to gross negligence or willful regard for the welfare of others Answer What type of legal liability is imposed on a person regardless of fault for liability such as liability for employee injury and manufacturing of chemicals or other dangerous substances? absolute or strict liability Answer What type of liability may be imposed on someone for the negligent acts of others within the person's control or supervision or for employees acting within the scope of the authority granted? vicarious liability Answer The following are legal requirements for bringing a suit involving negligence except? a.All are legal requirements Correct Answer b.The person must fail to perform the legal duty c.The person must be under a legal duty to perform some action d.The injury must be the proximate (related) cause of the failure to perform Which of the following legal damages are not covered by liability policies? a.General damages b.Punitive damages Correct Answer c.Compensatory damages d.Special damages
What type of compensatory damage involves injuries that can easily be calculated in monetary terms often including injury that result in loss of wages and medical expenses? general damages Answer What type of compensatory damage involves injuries that may not be easily calculated in monetary terms often including injury such as pain and suffering, death and other serious injury? special damage Answer Which of the following is not one of the duties of an insured after the occurrence of a loss that is insured? a.Cooperate with the insurer b.All are duties Correct Answer c.Prompt notice of the loss to the insurer d.Act in ways to preserve the insurer's rights under the contract B What insurance clause provides the insurer the right to recover claims paid to an insured from a negligent third party and the insured is prohibited from impeding the insurer's rights under the clause? a.Subrogation clause Correct Answer b.Assignment clause c.Indemnity clause d.Insurable interest clause A What insurance clause prohibits the insured from transferring the rights under the contract to another without written consent of the insurer? rights of assignment clause Answer What will happen to insurance coverage when the property insured is taken outside the territory (geographic area) specified by the insurance contract? The coverage will be suspended until the property is return to the covered territory". Answer
b.The insurable interest provision c.The severability provision d.The liberalization provision c A statement of fact that is made part of an insurance contract and a breach would result in the contract being voidable by the insurer is? a.A concealment b.A representation c.A misrepresentation d.A warranty D An untrue statement made by an applicant for insurance coverage would be considered as? Misrepresentation Answer Statements made on an application for insurance for insurance coverage shall be deemed as? Answer representations:Note that Florida requires all statements on an insurance application should be representations and not warranties except for transportation insurance An insured's failure to reveal relevant facts known to the insured is considered as? Concealment Answer The following would be legal grounds for an insurer avoidance of performance (prevent recovery) under an insurance contract except? a.All would apply b.Intentional and fraudulent acts by an insured c.Misrepresentations that are material to the risk being insured d.Breach of a warranty under transportation insurance that would result in a hazardous condition and the means of the breach is within the control of the insured A
The following are related to the Federal Fair Credit Reporting Act (FCRA) except? a.The consumer is required to be provided with information related to the consumer reporting agency when there is an adverse decision b.All are related to the FCRA c.The act requires consumers to be aware of the purpose for a consumer report by providing written consent to securing a credit report d.The primary purpose of the act is to set guidelines for consumer reporting agencies regarding sharing of consumers non-public information B The following are information required to be excluded from consumer reports provided by consumer reporting agencies under the Fair Credit Reporting Act except? a.Arrest records over 7 years or expiration of statutes of limitations b.Report on bankruptcy adjudicated over 10 years and civil judgements over 7 years c.Paid tax liens or other adverse information antedating the report more than 7 years d.Information regarding Title Eleven of the US code The following are related to the Gramm-Leach-Bliley Act (GLBA) also known as the Financial Services Modernization Act (FSMA) except? a.It prohibits Banks and other financial institutions from cross marketing or involvement in financial products not related to the particular financial institution b.The act specifies that the privacy notice must contain a customer right of refusal to share their financial information with non-affiliates and contain the information collected, the use of the information and where and how the information is shared c.The act mandated financial institutions to implement policies and procedures to protect the integrity, confidentiality and privacy regarding the sharing of consumers non-public personal information
A Florida resident with 10/20/10 liability limits got in an accident in a state that requires 25/50/10 liability limits under that state financial responsibility law. What limit would apply to the accident in the other state? 25/50/10, the other state required limit would apply Answer The following are penalties for non-compliance under Florida financial responsibility law except? a.There would be no penalty b.The registration of all vehicles would be suspended c.Conviction of a 2nd degree misdemeanor for committing forgery or filing a false affidavits with the motor vehicle department d.The vehicle operator driver's license would be suspended A A person who does not own an auto, but is required to comply (file SR-22) with Florida financial responsibility law for use of non-own vehicles, can purchase? The named non-owner policy Answer The following are primary elements of Florida no-fault law except? a.Persons who comply with the law have limited immunity for injuries and coverage under no-fault only provides for bodily injury coverage and not property damage b.Florida is not a no-fault state c.Coverage is provided by the person's own insurer regardless of fault for an accident and benefits are provided under the state personal injury protection (PIP) coverage d.No-fault provides first party benefits for economic loss over other medical expense and disability policies except in excess for benefits payable under workers compensation B Answer The following vehicles are exempt from carrying no-fault coverage except? a.Government vehicles used in transit to transport more than 5 passengers b.Mobile homes and public school buses c.Taxicabs, limousines and vehicles with 2 wheels d.Vehicles with 4 or more wheels required to be registered for use on Florida public highways
D Answer What is the minimum required coverage limit under the state no-fault PIP coverage? $10,000 per person each occurrence (per accident), Which of the following is not a benefit under the state personal injury protection (PIP) coverage? a.60% of loss of gross income (work loss) b.80% of medical expenses c.100% for replacement of household services and $5,000 death benefit d.Survivors benefit D The following are other requirements under the PIP coverage except? a.Coverage may be provided subject to deductibles of $250, $500 and $1, b.Deductibles are subtracted from the medical expenses before applying to benefit c.Work loss benefits may be excluded for persons without earned income such as a retiree d.The insurer of the negligent party for an accident must provide PIP coverage to any person who is not at fault for the accident D An insured has $10,000 PIP coverage with $1,000 deductible and got in an accident that resulted medical expenses of $11,000. What is the PIP coverage for the medical expenses? $8,000 ($11,000 - $1,000 deductible @ 80%);Note:if after the calculation the amount had exceeded the coverage limit of $10,000 then the amount would have been the coverage limit as the loss cannot exceed the coverage limit The following are defined as insureds and would be entitle to PIP benefits except? a.The named insured and family members of the named insured household while
a.Permanent injury other than scaring and disfigurement b.Significant and permanent loss of bodily function c.All are thresholds d.Significant and permanent scaring and disfigurement C What is the required written notice an insurer is required to provide an insured for cancellation or non-renewal of coverage for automobile coverage? a.10 days for non-payment of premiums both for cancellation and non-renewal b.All are required c.Florida requires 45 days' notice for cancellations (first 90 days of coverage) d.Florida requires 45 days' notice for non-renewal (after 90 days coverage) and renewal of coverage B The following are related to uninsured motorist (UM) coverage in Florida except? a.The agent is required to offer UM coverage at the time of an application and have subject sign a written waiver by the applicant for refusal of coverage b.The insurer is required to offer UM coverage for insureds without UM coverage each year at the renewal date of the policy c.All apply to Uninsured Motorists coverage in Florida d.The UM coverage must be at least equal to the policy bodily injury liability coverage limit and have subject sign a waiver for lesser coverage C A Florida resident with physical damage coverage subject to a deductible of $ got in an accident that damage the auto glass and it would cost $1,500 to repair. What coverage would apply to the glass damage?
$1,500 (no deductible apply to glass damage in Florida Which of the following is not eligible for coverage under the personal auto policy (PAP)? a.An auto title in the name of a business b.A private passenger type auto including a Jeep or Station wagon c.A van or pickup with a gross weight of less than 10,000 pounds and not used to transport goods or materials d.An auto lease for a period of 6 months or more A Which of the following would not be part of the personal auto policy (PAP) declaration page? a.The telephone number of the insured b.The coverages, limits and any applicable deductibles c.The name of the loss payee (a creditor's interest in the auto) d.The policy period and insurer's name and home office address A Which of the following would not be considered as a covered auto under the PAP? a.An auto permanently assigned to an insured b.A temporary substitute auto due to the breakdown, repair or maintenance of the insured covered auto and a non-own auto not permanently assigned to an insured c.The auto listed in the policy declaration page including an own or non-own trailer d.A newly acquired auto including an additional or replacement auto A The following applies for coverage of a newly acquired auto under the PAP except?
Symbol 30 which provides liability coverage for damage to vehicles of others left in an insured care, custody and control. Which of the following would not be covered under the garage policy liability coverage? a.A person got in an accident due to a defective tire sold to him by an insured b.A person got in an accident due to a faulty breaking system installed by an insured c.A person got in an accident due to wheels not properly installed by the insured d.A person got in an accident while test driving an auto due to his fault D All of the following are coverages under the garage liability coverage except? a.Liability resulting from the premises of a garage business b.All are covered c.Liability arising from the operations of a garage business d.Liability arising from defective products and faulty workmanship B The following are excluded under the garage policy liability coverage except a.Property damage to an insured own products b.All are exclusions c.Injury to employees covered under workers compensation d.Liability resulting from recall of products B Which garage policy coverage covers an insured's liability for physical damage to non-own vehicles left in the care, custody and control of the insured? The garage keepers liability coverage Coverage for vehicles of auto dealers is usually written under what coverage form? On a blanket basis which means one limit would apply to any one loss.
Which of the following is not an exclusion under the garage policy dealer's coverage? a.Loss at a newly acquired location not reported to the insurer with 45 days of the location acquisition b.Collision damage to vehicles driven or transported from the point of purchase to a destination over a 50 miles radius c.Collision damage to vehicles driven within a 50 miles radius from the dealership d.Expected profits C What is the garage policy endorsement that would provide coverage for dealers for physical damage to vehicles delivered to a destination over a 50 miles radius from the point of purchase? The dealers drive away collision endorsement. What garage policy endorsement will provide physical damage coverage to dealers that ensure against loss from voluntary parting of a covered auto by trick or scheme or acquiring an auto from a person who does not have a legal title? The false pretense endorsement The following are related to commercial property insurance coverages except? a.Covers coverage for both direct and indirect losses b.Provides first party coverage for losses resulting from damage to property c.Provides liability coverage d.Coverage is provided for properties other than 1 to 4 families dwellings C What is the written notification period an insurer must provide an insured for the cancellation (within the first 90 days) and non-renewal (after the first 90 days) of a commercial property policy? 20 days for cancellation and 45 days for non-renewal and 10 days for non- payment of premiums.
