Florida Life & Health Insurance License, Practice Exams

Section 624.310 grants the office enforcement authority that specifically includes:

1. Setting the maximum commission an agent may earn on each life policy sold
2. Issuing cease and desist orders, removing certain affiliated parties, and imposing fines ✓
3. Approving the exact policy language a consumer receives before delivery
4. Issuing licenses to nonresident agents while the department handles residents

Why: Section 624.310 addresses enforcement, including cease and desist orders, removal of certain affiliated parties, and the imposition of fines.

An annuitant has a $40,000 cost basis and a $160,000 expected return. Of each $8,000 payment, the taxable portion is:

1. $6,000 ✓
2. $2,000
3. $4,000
4. $8,000

Why: Exclusion ratio = 40,000/160,000 = 25%; $2,000 of each $8,000 payment is excluded and $6,000 is taxable.

Credit disability insurance is designed to:

1. Replace the borrower's full salary during any period of unemployment
2. Cover the lender's legal costs of collecting on a defaulted loan
3. Pay off the entire loan balance immediately upon any minor injury
4. Make a borrower's loan payments if the borrower becomes disabled ✓

Why: Credit disability covers the loan payments (often monthly) while the insured borrower is disabled; credit life instead pays off the balance at death.

Medicare Part A is premium-free for a beneficiary who:

1. Enrolled in a private Medicare Advantage plan during the annual open enrollment window
2. Has about 40 quarters of Medicare-covered employment ✓
3. Bought a Medicare Supplement policy within six months of turning age sixty-five
4. Has reached full Social Security retirement age but is still working full time

Why: Most people qualify for premium-free Part A by having about 40 quarters (10 years) of Medicare-covered employment (their own or a spouse's).

In ERISA-governed plans, 'vesting' refers to an employee's:

1. Ability to name a new beneficiary on the group life certificate
2. Nonforfeitable right to employer-contributed retirement benefits ✓
3. Option to convert group coverage to an individual policy at any time
4. Right to receive their full salary while on an approved medical leave

Why: Vesting is the employee's nonforfeitable right to employer contributions, earned under the plan's vesting schedule.

Life insurance is generally a 'valued' (not indemnity) contract because it pays:

1. A benefit reduced by other coverage in force
2. Nothing unless the beneficiary documents expenses
3. Only the actual financial loss the family proves
4. A stated face amount, not the measured economic loss ✓

Why: Life insurance pays the agreed face amount regardless of proven loss; medical expense insurance instead indemnifies actual costs.

Self-insurance (retention) is a risk-handling method in which a business:

1. Shares the risk with other businesses by contract
2. Sets aside its own funds to pay for potential losses ✓
3. Transfers the risk entirely to an insurer
4. Avoids the activity that creates the risk

Why: Retention/self-insurance means bearing the loss with one's own funds; transfer (insurance), avoidance, and sharing are the alternatives.

An 'own-occupation' definition in a disability income policy pays benefits when the insured cannot perform:

1. activities of daily living
2. The duties of their own occupation ✓
3. household chores
4. Any job for which they are reasonably suited

Why: Own-occupation pays if the insured cannot do their own job, even if able to work elsewhere; it is more generous than any-occupation.

A provision allowing a terminally ill insured to receive part of the death benefit while still living is the:

1. An accelerated (living) death benefit for the terminally ill ✓
2. An automatic premium loan against the death benefit, used by the terminally ill to keep the policy in force while living
3. A reinstatement putting a lapsed policy back in force after proof of insurability
4. A coordination-of-benefits offset

Why: The accelerated death benefit lets a terminally or chronically ill insured access part of the face amount before death; the remainder goes to beneficiaries.

An agent offers to pay part of the premium for a prospect in a way not plainly expressed in the policy contract, as an inducement to buy. Absent a lawful exception, this is best classified as:

1. An unlawful rebate ✓
2. Defamation
3. Sliding
4. A boycott

Why: Unlawful rebates include knowingly paying, allowing, or giving (or offering) any inducement not plainly expressed in the insurance contract as to the contract issued. Rebating is only permitted under specific statutory conditions.

Which of the following is expressly EXCLUDED from coverage by the Florida Life and Health Insurance Guaranty Association?

1. A fixed individual annuity owned by a Florida resident
2. An individual major medical health policy
3. A whole life policy issued by a licensed domestic insurer
4. Fraternal benefit societies and dental service plan insurance ✓

Why: Section 631.713(3) excludes fraternal benefit societies, dental service plan insurance, and several similar lines from the part.

A convertible term policyholder converts to whole life before the conversion deadline. They:

1. Can only convert to another term policy
2. Need not provide new evidence of insurability ✓
3. Forfeit all prior premiums paid
4. Must pass a new medical exam

Why: A conversion privilege lets the insured switch term to permanent coverage without new evidence of insurability.

Federal anti-money-laundering rules require life insurers, for covered products, to:

1. Refuse to sell any permanent life insurance to new applicants
2. Verify a buyer's citizenship before issuing any annuity
3. Maintain an AML program and report suspicious transactions ✓
4. Report every policy sold, regardless of size, to the Treasury

Why: Insurers must maintain AML programs and file suspicious activity reports; permanent life and annuities are 'covered products' producers help monitor.

Under COBRA, the maximum continuation period for an employee who loses coverage due to termination or reduced hours is generally:

1. 18 months ✓
2. 36 months
3. 12 months
4. 60 months

Why: Termination or reduced hours allows 18 months of COBRA continuation; events like divorce, death, or a child aging out allow up to 36 months.

Outside the special rules in s. 626.9521(3) for twisting, churning, fraudulent signatures and declared-emergency claims, the general penalty provision of the Unfair Insurance Trade Practices part authorizes a fine for each willful violation of up to:

1. $50,000 for each willful violation
2. $250,000 for each willful violation
3. $100,000 for each willful violation ✓
4. $10,000 for each willful violation

Why: Section 626.9521(2) authorizes a fine of up to $100,000 for each willful violation of the part (and up to $12,500 for each nonwillful violation); separate penalties in s. 626.9521(3) apply to twisting, churning, willfully submitting fraudulent signatures and violations related to a declared emergency.

A long-term care policy must provide a grace period for payment of premiums after the first of not less than:

1. 10 days
2. 20 days
3. 30 days ✓
4. 45 days

Why: An LTC policy must provide a grace period of not less than 30 days for premiums after the first.

An investigative consumer report differs from an ordinary consumer report in that it:

1. Contains only verified factual data drawn from public records
2. May be obtained without ever notifying the insurance applicant
3. Is based on interviews about the applicant's character and lifestyle ✓
4. Can legally be used only for property and casualty underwriting

Why: An investigative consumer report gathers information through interviews about reputation, character, and habits; the applicant must be notified it may be obtained.

As defined in Florida's Licensing Procedures Law, a 'license' is best described as which of the following?

1. A document issued by the department authorizing a person to be appointed to transact insurance or adjust claims ✓
2. A registration issued by an approved provider showing the holder completed 24 hours of continuing education
3. A sworn certification filed by an employer with the department attesting that an appointee is trustworthy and of good character
4. The written agency contract by which an insurer authorizes a producer to bind coverage on its behalf and fixes commissions

Why: Section 626.015(11) defines 'license' as a document issued by the department or office authorizing a person to be appointed to transact insurance or adjust claims for the identified kind, line, or class.

A "domestic" insurer is defined under the Florida Insurance Code as one that is:

1. Formed under the laws of another U.S. state
2. Formed under the laws of this state ✓
3. Other than a domestic or foreign insurer
4. Authorized by a foreign government

Why: A "domestic" insurer is one formed under the laws of this state (Florida).

The federal Genetic Information Nondiscrimination Act (GINA) generally restricts the use of genetic information in:

1. Health insurance and employment decisions ✓
2. Setting state automobile insurance premium rates
3. Property and casualty insurance underwriting only
4. Determining eligibility for federal student loans

Why: GINA limits how genetic information may be used in health coverage and employment, prohibiting discrimination based on genetic test results.

Medicare Part A would help pay for which of the following?

1. A routine outpatient physician office visit
2. A covered inpatient hospital stay ✓
3. Long-term custodial care in a nursing home
4. A self-administered prescription filled at a pharmacy

Why: Part A covers inpatient hospital, skilled nursing, hospice, and some home health; physician visits are Part B and drugs are Part D.

Single-premium whole life insurance is funded by:

1. Flexible deposits that the owner may raise or lower in any given year
2. A modest first-year premium followed by much larger renewal premiums for life
3. A single large premium that fully pays up the policy at issue ✓
4. Level annual premiums paid until the insured reaches sixty-five years of age

Why: One lump-sum premium creates a fully paid-up permanent policy with no further premiums due.

A two-tier annuity is one in which the contract has:

1. Two named annuitants, both of whom must survive for the income payments to continue
2. Two declared interest rates, one for new deposits and one for older money, that the owner switches between each year
3. A higher value if annuitized and a lower value if surrendered for cash ✓
4. A death benefit equal to twice the account value if the owner dies during the accumulation period

Why: A two-tier annuity credits a higher value when the owner annuitizes and a lower value on cash surrender, incentivizing annuitization.

Under a 'per capita' beneficiary designation, if one of several named beneficiaries dies before the insured, that share:

1. Passes down to that deceased beneficiary's own children
2. Is retained by the insurer as an unclaimed windfall
3. Is divided among the surviving named beneficiaries ✓
4. Reverts to the policyowner's estate for probate handling

Why: Per capita splits proceeds equally among the surviving named beneficiaries; per stirpes instead sends a deceased beneficiary's share to that person's descendants.

An accident-only policy provides benefits for:

1. Long-term custodial nursing-home care after an accident
2. Losses resulting from accidents, but not from sickness ✓
3. Routine preventive care and annual wellness checkups only
4. Both accidental injuries and any illness the insured develops

Why: Accident-only coverage is limited to losses caused by accidental injury; sickness is excluded, making it a limited (supplemental) policy.

Under the fixed-amount settlement option, the insurer pays:

1. A guaranteed income for the entire remaining lifetime of the payee
2. A set dollar amount each period until the proceeds and interest run out ✓
3. Only the interest earned, leaving the principal untouched indefinitely
4. Equal payments over a fixed number of years stated in advance by the owner

Why: Fixed-amount pays a chosen dollar amount each period until the proceeds plus interest are exhausted; fixed-period instead fixes the duration.

An applicant placed in a 'substandard' risk class will:

1. Receive a premium discount
2. Pay a higher-than-standard premium ✓
3. Be automatically declined
4. Get a guaranteed-issue policy

Why: Substandard (rated) risks present higher mortality risk and pay an increased premium.

Under the Affordable Care Act, individual major medical plans generally must:

1. Require a medical exam before an applicant can be issued coverage
2. Impose a lifetime dollar maximum on all essential health benefits
3. Charge higher premiums to applicants with chronic health conditions
4. Cover essential health benefits and not exclude pre-existing conditions ✓

Why: ACA-compliant plans must cover essential health benefits, be guaranteed issue, and cannot exclude or rate up for pre-existing conditions.

A plan has a $1,000 deductible and 60/40 coinsurance. On a $6,000 covered bill, the insured pays:

1. $3,000 ✓
2. $2,400
3. $1,000
4. $3,400

Why: Deductible $1,000 + 40% of the remaining $5,000 ($2,000) = $3,000.

Providers of the required annuity training course under § 627.4554 are prohibited from:

1. Offering the course content through a self-study format
2. Issuing any certificate of completion to attending agents
3. Covering the topic of income taxation of annuities
4. Providing training on sales techniques or specific insurer products ✓

Why: Section 627.4554(6)(b)4. bars providers from presenting marketing information, sales-technique training, or specific insurer-product information.

Each health insurance policy text must be printed in type that is uniform and not less than what minimum point size?

1. 10 points ✓
2. 8 points
3. 14 points
4. 12 points

Why: Policy text must be printed in lightfaced type of a size not less than 10 points.

A long-term care policy may NOT be canceled or nonrenewed on the basis of:

1. Nonpayment of premium
2. The insured's age or deterioration of mental or physical health ✓
3. A statewide nonrenewal approved by the Office for solvency reasons
4. Material misrepresentation in the application

Why: An LTC policy may not be canceled or nonrenewed based on the insured's age or the deterioration of mental or physical health.

A 'period certain only' annuity option pays income:

1. Only if the annuitant survives the full accumulation period
2. For the annuitant's entire life and stops at their death
3. In a single lump sum at the end of the surrender-charge period
4. For a fixed number of years whether or not the annuitant lives ✓

Why: Period-certain-only pays for a set number of years; if the annuitant dies early, payments continue to a beneficiary for the remainder.

A pure (straight) life annuity payout option provides:

1. Equal payments split between the annuitant and a surviving spouse
2. A guaranteed refund of all unused premiums to a named beneficiary
3. The largest periodic payment, but nothing to anyone after the annuitant dies ✓
4. Payments for a fixed number of years regardless of the annuitant's life

Why: Pure life pays the highest income because payments stop at death with no refund or beneficiary payment; refund and period-certain options pay less but protect a beneficiary.

Absent earlier termination, how long does an agent's appointment continue in effect under section 626.461?

1. Until the agent changes employers, when a new appointment must be filed within 30 days
2. For exactly 12 months from issuance, after which the appointing entity must reapply for it
3. Until the person's license is revoked or otherwise terminated, subject to renewal ✓
4. For 24 months from the date of issuance, at which point it lapses by operation of law

Why: Section 626.461 provides the appointment continues in effect, subject to renewal, until the license is revoked or otherwise terminated unless earlier written notice of termination is filed.

Mental health parity requirements generally provide that a group plan's mental health benefits must be:

1. Excluded entirely unless the employer chooses to add them
2. Paid only after the insured exhausts all other available coverage
3. No more restrictive than its medical and surgical benefits ✓
4. Limited to a maximum of three covered visits each calendar year

Why: Parity rules require that financial requirements and treatment limits on mental health/substance use benefits be no more restrictive than those on medical/surgical benefits.

Unlike a conditional receipt, a binding (temporary) receipt provides:

1. Immediate coverage for a set time even if the applicant is uninsurable ✓
2. No coverage whatsoever until the policy is physically delivered to the owner
3. Coverage only once the insurer has formally approved the entire application
4. Coverage that is contingent on the applicant later passing a paramedical exam

Why: A binding receipt gives immediate temporary coverage for a stated period regardless of insurability; a conditional receipt requires the applicant to prove insurable.

A reciprocal insurer is:

1. An unincorporated group of members who insure each other through an attorney-in-fact ✓
2. A federal chartering agency that licenses insurers under the McCarran-Ferguson Act
3. A stock company whose shareholders elect the board and receive taxable dividends
4. A fraternal benefit society organized in lodges that sells only to its own members

Why: A reciprocal is an unincorporated association whose subscribers exchange insurance among themselves, managed by an attorney-in-fact.

The agent's report attached to a life insurance application is:

1. A required disclosure that must be given to the applicant at delivery
2. A legally binding warranty made by the proposed insured
3. The agent's confidential observations, which are not part of the contract ✓
4. The medical history section the applicant completes personally

Why: The agent's report conveys the producer's observations to the underwriter; it is not part of the entire contract and is not shown to the applicant.

Under the interest-only settlement option, the insurer:

1. Distributes equal payments over a stated number of years and then stops
2. Holds the proceeds and pays only the interest earned to the payee ✓
3. Guarantees income payments for the entire remaining life of the payee
4. Pays a fixed dollar amount each period until the funds are fully exhausted

Why: Interest-only leaves the principal with the insurer and pays out just the interest; the principal is paid later.

To qualify for transfer of a resident agent license from another state under section 626.292, the applicant must submit a completed Florida application within how many days after becoming a Florida resident?

1. Within 90 days ✓
2. Within 60 days
3. Within 30 days
4. Within 180 days

Why: Section 626.292(2)(c) requires the completed application to be received within 90 days after the date the individual became a Florida resident.

The federal Gramm-Leach-Bliley Act requires financial institutions, including insurers, to:

1. Protect the privacy of customers' nonpublic personal information ✓
2. Sell insurance only through federally chartered national banks
3. Report all claims directly to the Internal Revenue Service
4. Charge identical premiums to every applicant in the country

Why: Gramm-Leach-Bliley requires privacy notices and limits on sharing nonpublic personal financial information, with an opt-out for consumers.

In group underwriting, a 'guaranteed issue' limit is the amount of coverage that:

1. Members can obtain without providing individual evidence of insurability ✓
2. Is automatically doubled for any employee who enrolls one or more dependents in the plan
3. The employer is required to buy for every eligible employee, whatever the resulting rate
4. Each member must pay for entirely out of pocket

Why: Up to the guaranteed issue limit, members are covered without individual medical evidence; amounts above it require proof of insurability.

A 'dual eligible' individual is someone who qualifies for:

1. Both an HSA and a flexible spending account together
2. Both Medicare and Medicaid ✓
3. Medicare Part A but not Part B coverage
4. Two separate private major medical plans at once

Why: Dual eligibles qualify for both Medicare and Medicaid; Medicaid may help cover Medicare premiums and cost sharing for those with limited income.

Survivorship (second-to-die) life insurance is most commonly used to:

1. Fund a child's future college costs through the policy's accumulated cash value
2. Provide estate liquidity after the second insured dies ✓
3. Replace the income of a sole wage earner who has several young children at home
4. Cover a short-term business loan that must be fully repaid within five years

Why: It pays at the second death and is widely used to fund estate taxes and costs.

Which dividend option purchases small amounts of additional paid-up insurance?

1. Reduction of premium
2. Accumulate at interest
3. Paid-up additions ✓
4. Cash

Why: Paid-up additions use dividends to buy small single-premium amounts of permanent insurance, increasing both death benefit and cash value.

A home health care benefit generally provides:

1. A cash payment regardless of whether any care is received
2. Coverage only for care delivered inside a hospital
3. Part-time skilled nursing or therapy in the insured's home ✓
4. Round-the-clock custodial help for an indefinite period

Why: Home health care covers intermittent skilled services (nursing, physical therapy) delivered at home, usually following an illness or injury.

What may the Office do regarding the certificate of an HMO that does not timely pay its assessment to the Florida Health Maintenance Organization Consumer Assistance Plan?

1. Suspend or revoke the HMO's certificate of authority ✓
2. Refer the matter to the Legislature for special action
3. Convert the HMO into a prepaid health clinic
4. Impose a mandatory premium surcharge on subscribers

Why: Section 641.228(3) allows the Office to suspend or revoke the COA of an HMO that does not timely pay its Consumer Assistance Plan assessment.

For how long must a Florida licensee preserve books, accounts, and records pertaining to a premium payment?

1. At least 5 years after payment
2. At least 1 year after payment
3. At least 3 years after payment ✓
4. At least 2 years after payment

Why: Section 626.561(2) requires preservation of premium-payment records for at least 3 years after payment.

An HMO health care provider certificate issued by the agency automatically expires after how long unless renewed?

1. 2 years from the date of issuance ✓
2. 1 year from the date of issuance
3. 5 years from the date of issuance
4. 3 years from the date of issuance

Why: Section 641.495(2) provides the provider certificate automatically expires 2 years from issuance unless renewed (with a $1,000 renewal fee).

Variable universal life (VUL) insurance combines:

1. Flexible premiums with policyowner-directed separate-account investments ✓
2. Decreasing term coverage with a built-in cost-of-living adjustment
3. Group coverage that requires no individual evidence of insurability
4. A fixed level premium with a guaranteed minimum cash value at all times

Why: VUL merges universal life's premium and death-benefit flexibility with variable separate accounts; the owner bears the investment risk.

In an annuity, the person whose life the income payments are based on is the:

1. Insurer
2. Annuitant ✓
3. Beneficiary
4. Owner

Why: The annuitant is the measuring life for payments; the owner controls the contract and the beneficiary receives any death proceeds.

A statement on an application that is believed true to the best of the applicant's knowledge is a:

1. Concealment
2. Waiver
3. Warranty
4. Representation ✓

Why: A representation is believed true to the applicant's best knowledge; a warranty is guaranteed to be literally true. Most life applications are treated as representations.

Under the entire-contract provision required for Florida life policies, statements contained in the application are, in the absence of fraud, deemed to be:

1. Representations and not warranties ✓
2. Warranties and conditions precedent to coverage
3. Affirmative warranties governing the insured's future conduct
4. Binding promissory warranties enforceable against the estate

Why: Section 627.454 provides that all statements in the application shall, in the absence of fraud, be deemed representations and not warranties.

Under the endorsement method of a split-dollar plan, the policy is:

1. Held in an irrevocable trust outside the reach of both parties
2. Required to lapse automatically when the employee retires
3. Owned by the employee personally, who then assigns the entire policy back to the employer as collateral security for a loan
4. Owned by the employer, which endorses part of the death benefit to the employee's beneficiary ✓

Why: In endorsement split-dollar the employer owns and controls the policy and endorses a portion of the death benefit to the employee's named beneficiary.

A child (children's) term rider added to a parent's life policy:

1. Converts the parent's policy into a joint survivorship contract covering both parents and each child
2. Pays a monthly income to the parent until each child turns 18
3. Waives the parent's premiums while a covered child is hospitalized
4. Provides level term coverage on the insured's children for a small added premium ✓

Why: A child term rider covers the insured's children under one rider, usually convertible to permanent coverage without evidence.

A notice of replacement to a current insurer is NOT required, under § 627.4605, when the transaction involves:

1. A tax-free exchange moving cash value to a different carrier
2. A term conversion privilege exercised among corporate affiliates ✓
3. Replacement of the policy by an entirely unrelated competing insurer
4. Surrender of the existing policy for cash with no new coverage

Why: Section 627.4605(3) exempts from the replacement-notice requirement a term conversion privilege exercised among corporate affiliates.

A deductible 'carryover' provision in a major medical plan allows expenses incurred in the last months of the year to:

1. Be refunded in full to the insured at year end
2. Double the plan's annual out-of-pocket maximum amount
3. Apply toward the next year's deductible ✓
4. Permanently eliminate the deductible for all future years

Why: A carryover provision lets eligible expenses from the final months (often the last three) count toward the following year's deductible.

A policyowner uses dividends to receive a check each year. This is the ____ dividend option.

1. paid-up additions
2. cash ✓
3. accumulate at interest
4. reduction of premium

Why: The cash option simply pays the dividend to the owner; it is the simplest of the dividend options.

Effective January 1, 2020, the Association's per-life liability for basic hospital, basic medical-surgical, or major medical expense health insurance policies (excluding long-term care) is limited to what amount?

1. $100,000
2. $300,000
3. $500,000 ✓
4. $750,000

Why: Section 631.717(12)(d) sets a $500,000 limit for those health insurance policies, effective January 1, 2020.

Errors and omissions (E&O) insurance protects a producer against:

1. Losses caused by the producer's own intentional fraud, theft, or conversion of client premium funds
2. Claims arising from negligent acts or mistakes in their professional work ✓
3. The cost of premiums owed by clients who fail to pay before the grace period expires
4. Penalties for selling without a valid state license

Why: E&O is professional liability coverage for negligent errors or omissions; it excludes intentional or fraudulent conduct.

A primary tax advantage of a deferred annuity during accumulation is that earnings:

1. Are taxed each year but at a reduced capital-gains rate
2. Are completely exempt from income tax even when withdrawn
3. Generate an annual deduction equal to the interest credited
4. Grow tax-deferred until they are withdrawn ✓

Why: Annuity earnings accumulate tax-deferred; taxes apply only when distributions are taken.

Under s. 817.234, if the value of property involved in an insurance-fraud violation is $100,000 or more, the offender commits:

1. A felony of the third degree
2. A first-degree misdemeanor
3. A felony of the first degree ✓
4. A felony of the second degree

Why: Section 817.234(11)(c) provides that if the value of the property involved is $100,000 or more, the offender commits a felony of the first degree.

A SEP (Simplified Employee Pension) plan is funded by:

1. Premiums paid into a variable life insurance policy
2. Mandatory after-tax contributions from every employee's paycheck
3. Employer contributions made into each eligible employee's IRA ✓
4. A single lump sum the government deposits for low-income workers

Why: Under a SEP, the employer contributes to a traditional IRA established for each eligible employee; contributions are discretionary and tax-deductible to the employer.

A 'Social Insurance Supplement' (SIS) rider stops paying once the insured:

1. Recovers fully from the disabling condition
2. Begins receiving the expected Social Security benefit ✓
3. Returns to any form of part-time employment
4. Reaches the policy's stated benefit maximum age

Why: An SIS rider supplements income while Social Security is not yet payable; it reduces or stops once Social Security benefits begin.

No person may engage in a trade practice in Florida that is defined in the part as, or determined to be, an unfair method of competition or an unfair or deceptive act. Where is that general prohibition stated?

1. In the section prohibiting such practices and setting penalties ✓
2. Only in an administrative rule adopted by the commission, not in statute
3. In the chapter governing surplus lines placements
4. In the federal McCarran-Ferguson Act, which preempts state law here

Why: The prohibition states that no person shall engage in this state in any trade practice defined in the part as, or determined to be, an unfair method of competition or an unfair or deceptive act or practice.

A family maintenance policy combines whole life with level term to:

1. Provide temporary coverage only, expiring with no cash value at the end of a stated 10- or 20-year term
2. Invest part of each premium in the mutual fund subaccounts the policyowner selects and may switch at will
3. Decrease the death benefit gradually as the children grow up and the family's income need falls away
4. Pay an income for a set period beginning at the insured's death, then the face amount ✓

Why: Family maintenance adds level term to whole life; if the insured dies during the term, it pays income for a stated period from the date of death, then the face amount.

An employee leaving a group life plan may convert to an individual policy:

1. Only after at least five years of continuous group service
2. At the group's experience-rated premium for the rest of life
3. Without evidence of insurability, generally within thirty-one days ✓
4. Only after passing a new medical exam at the insured's expense

Why: The conversion privilege lets a departing employee convert to individual coverage without evidence of insurability, typically within 31 days.

Under the required "Proof of Loss" provision, written proof of loss for a loss other than a continuing periodic loss must generally be given within how many days after the loss?

1. 30 days
2. 60 days
3. 90 days ✓
4. 120 days

Why: Written proof must be given within 90 days after the loss for losses other than periodic continuing losses.

Medicare Part A 'lifetime reserve days' are:

1. Unlimited days of fully covered skilled nursing facility care
2. 60 extra hospital days usable once over the beneficiary's lifetime ✓
3. Days the beneficiary may transfer to a spouse or dependent
4. Renewed automatically at the start of every new benefit period

Why: After 90 days in a benefit period, a beneficiary may draw on 60 lifetime reserve days (with higher coinsurance); once used, they are not replaced.

In an equity-indexed annuity, the 'cap rate' is the:

1. Maximum interest rate credited even if the index rises more ✓
2. Share of the index gain that the insurer credits to the contract
3. Guaranteed minimum rate credited when the index loses value in a year
4. Fee deducted on surrender in year one

Why: The cap is the ceiling on credited interest; the participation rate sets the share of the gain and the floor sets the minimum.

Under the HMO Act, an assessment paid to the Florida Health Maintenance Organization Consumer Assistance Plan is treated how for the paying HMO?

1. It may be carried as an admitted asset of the HMO
2. It may be offset against surplus requirements
3. It may not be allowed as an asset of any HMO ✓
4. It is refundable on demand within 30 days

Why: Section 641.228(2) provides that no assessment paid to the plan shall be allowed as an asset of any HMO.

A whole life policyowner borrows against the cash value and does not repay it. At death, the death benefit is:

1. Paid in full, with the loan forgiven
2. Forfeited entirely because of the loan
3. Replaced by a refund of premiums
4. Reduced by the outstanding loan and interest ✓

Why: An unpaid policy loan plus interest is subtracted from the death benefit paid to the beneficiary.

A 'future increase option' (guaranteed insurability) rider on a disability policy lets the insured:

1. Shorten the elimination period after each year the policy is held
2. Add a spouse to the policy at any time with no additional premium
3. Increase the benefit amount later without proving insurability again ✓
4. Receive an automatic refund of premiums if never disabled

Why: This rider allows scheduled increases in the monthly benefit (as income rises) without new evidence of medical insurability.

A worker is injured on the job and cannot work. Under a nonoccupational disability policy, the claim is:

1. Not covered, because on-the-job injuries fall under workers' compensation ✓
2. Covered in full at the stated monthly benefit, since the policy is 24-hour coverage
3. Covered once a 90-day elimination period runs from the injury date
4. Covered at 60% of the normal benefit to coordinate with the state fund

Why: Nonoccupational coverage excludes work-related injuries (handled by workers' compensation); occupational/24-hour coverage applies on or off the job.

Many states and federal law require that group health plans covering dependents include newborn children:

1. Beginning at the start of the next plan year following the birth
2. From the moment of birth, with a short window to formally add them ✓
3. Only after the child reaches thirty days of age and is examined
4. Solely if the newborn passes an individual medical underwriting review

Why: Newborns must be covered from birth (including congenital conditions), with a limited period (often 31 days) to notify the insurer and add the child.

Which activity is expressly treated as 'solicitation of insurance' requiring a license under section 626.112?

1. Filing completed policies in the agency records at an agent's direction
2. Delivering the agency's incoming mail and parcels to the office
3. Cleaning and locking the agency premises after business hours
4. Describing the benefits or terms of insurance coverage, including premiums ✓

Why: Section 626.112(1)(b) lists describing the benefits or terms of coverage, including premiums or rates of return, as solicitation requiring a license.