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Florida Health Insurance > Florida General Insurance Laws and Rules > Flashcards

Florida General Insurance Laws and Rules Flashcards

1
Q

Which entity protects policyowners, insureds, and beneficiaries if an insurer cannot perform its contractual obligations because of impairment or insolvency?

A

Florida Life and Health Guaranty Association

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2
Q

What is it called when an insurance company charges different premium rates and pays different benefits to persons of the same class and equal risks?

A

Unfair and Prohibited business practices.

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3
Q

ABC company operates as a viatical settlement provider in Florida. For which of the following reasons can the Office of Insurance Regulation suspend or revoke ABC’s license?

A

Issuing viatical settlement contracts that were approved in Texas but not in Florida. (The contracts have to be approved in Florida)

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4
Q

The person or company that buys a life insurance policy from a policyholder. Ex: someone who is terminally ill that needs cash quick..usually ends up with less than the full amount of the policy’s death benefit.

A

a viatical settlement provider

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5
Q

What is a requirement to operate as an insurance AGENCY in Florida?

A

Obtaining a license or registration from the state….Also a full-time licensed general lines agent or life or health agent must be appointed to manage each agency.

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6
Q

If a person violates a cease and desist order, what penalty(s) can The Commissioner of the Office of Insurance Regulation impose?

A

a fine of up to $50,000, suspend or revoke the persons’s license, or impose a fine and suspend or revoke a license.

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7
Q

An insurer must notify its current customers of its privacy policies or practices at least once every how often?

A

12 months… insurer must notify its current customers of privacy policies or practices at least once every year.

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8
Q

What unfair trade practice involves using policy values in an existing policy to purchase another policy without having a reasonable basis for believing that the new policy will provide the policyowner with an actual benefit? ..An agent would do this to increase their commissions.

A

Churning

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9
Q

BBX Insurers terminated Henry’s appointment as its life insurance agent on December 1. How long will Henry remain eligible to be appointed as a life insurance agent by another insurer?

A

48 months.

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10
Q

A producer selling health insurance, assures a prospective applicant that the insurance company she represents is backed by the protections of the Florida Life and Health Insurance Guaranty Association. What is true about this kind of assurance?

A

It is prohibited at all times….It is an unfair trade practice to use the existence of the Florida Life and Health Insurance Guaranty Association, or the protections it offers, for the purpose of SELLING insurance.

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11
Q

Conrad obtained a life insurance agent’s license primarily to write insurance for his family members and friends. Which unfair trade practice has Conrad engaged in?

A

Controlled business.

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12
Q

Insurance that is primarily written on the lives, property, or risks of the agent or of the agents family members, employers, or business associates.

A

Controlled business

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13
Q

Failing to promptly settle a claim for which liability is uncertain is NOT an unfair claims settlement practice if committed by an insurance company in Florida… True or False?

A

True. An insurer is not obligated to settle a claim for which it is not clearly liable.

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14
Q

Transacting insurance includes all of the following EXCEPT:
A) negotiating insurance contracts
B) soliciting insurance contracts
C) transacting matters after an insurance contract has been issued that are related to the policy.
D) underwriting insurance contracts

A

Underwriting insurance contracts

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15
Q

When are insurers required to make restitution? And if they dont it is considered a willful violation of the insurance code.

A

they are required to make restitution to injured parties.

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16
Q

What is the term for when a fraternal benefit society(life insurance company) is converted and licensed as a mutual life insurance company? Who must approve the conversion before it become effective?

A

mutualization
The Dept. of financial services must approve it

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17
Q

All insurers, including fraternal benefit societies, must be members of what association in the state of Florida?

A

The florida life and health guaranty association

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18
Q

Before a mail order insurance company can solicit insurance in Florida, they must do what?

A

Submit a copy of its policies and certificates to the Office of Insurance regulation for approval.

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19
Q

What is the purpose of the Florida Life and Health Guaranty association?

A

it protects the policyowners, insured’s, beneficiaries, annuitants, payees, health insurance policies, and annuity contracts if an insurer fails to perform its contractual obligations because it becomes impaired or insolvent.

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20
Q

Who issues certificates of authority to qualified insurers that permits them to transact insurance business in Florida?

A

The office of insurance regulation

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21
Q

What title is the head of the Florida dept. of financial services, and oversees 13 divisions?

A

The Chief financial officer

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22
Q

What is the financial services commission composed of? (4 titles)

A

-The Governor
-The chief financial officer
-The Attorney general
-The commissioner of agriculture

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23
Q

The financial services commission appoints ____ to oversee the ____?

A

Insurance commissioner to oversee the Office of insurance regulation.

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24
Q

What office regulates insurance company and producer licensing, premium rates, policy forms, market conduct, claims, and solvency?

A

The office of insurance regulation

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25
Q

Collectively, the CFO, Financial services commissioner, and Commissioner of the office of insurance regulation, do what?

A

They administer florida’s insurance laws.

26
Q

Each willful violation of the insurance code or rule of the Dept., Office, or Commission is what kind of penalty?

A

A second degree misdemeanor unless a greater penalty is prescribed.

27
Q

An unlicensed person who willfully violates an emergency rule or order of the Dept., Office, or Commission is what penalty?

A

Third-degree felony.

28
Q

Cease and Desist order means what?

A

Stop all illegal activities and take corrective action.

29
Q

At what point can a cease and desist order be issued?

A

After a complaint has been made stating the charges, and the person has an opportunity for a hearing.

30
Q

When can an emergency cease and desist order be issued?

A

if persons conduct is likely to cause: -insolvency, -dissipation of a licensee’s earnings/values, -inability to pay claims on time, harm/prejudice to insureds or the public.

31
Q

How long does an emergency cease and desist order remain effective for?

A

90 days

32
Q

If a person violates a cease and desist order, the Dept. or Office may do what? (3 things)

A

fine up to 50,000$
suspend or revoke the person’s license
impose a fine AND suspend or revoke a license.

33
Q

Penalties for unfair trade practices-if a person commits an unfair method of competition or deceptive act or practice, the Office or Dept. may impose what?

A

a fine of up to 2,500$ for each nonwillful violation or
a fine up to 20,000$ for each willful violation.

34
Q

A person who engages in twisting or churning commits a misdemeanor of what degree?
And may also be fined.

A

misdemeanor of 1st degree

35
Q

A person who willfully submits insurance applications or policies with fraudulent signatures commits what?

A

felony of the 3rd degree

36
Q

Medicaid is considered a last resort payor for medicaid recipients. All other sources should be primary- If medicaid provides benefits but another party should have paid for the care, what is to be done?

A

Medicaid must be repaid in full

37
Q

The Office can examine the books and records of an insurer as often as necessary, but must examine a domestic insurer AT-LEAST?

A

at-least once every 5 years

38
Q

True or False: The Dept., Commission, and Office may hold hearings for any purpose within the scope of the insurance code, whenever deemed necessary.

A

True

39
Q

True or False: Florida regulates the type of assets in which insurers may invest.

A

True

40
Q

What does Florida require insurers must retain, in order to guarantee the payment of life insurance claims and benefits?

A

A minimum amount of legal reserves.

41
Q

What is the difference between a legal reserve life insurer and an assessment life insurer?

A

An assessment life insurer is not required to maintain legal reserves. ..Assessment life insurers are not allowed to operate in Florida, except for certain multiple employer welfare arrangements.

42
Q

Agents who intentionally represent an unauthorized insurer commit?

A

a felony in the 3rd degree.

43
Q

Insurers are required to file an ANNUAL statement regarding their financial condition, transactions, and affairs with the Office by what date? They must also file statements how often?

A

ANNUALLY-March 1
also quarterly statements.

44
Q

If a life insurance policy is being REPLACED, the agent must give the applicant The Notice Regarding Replacement when?

A

No later than at the time of the application.

45
Q

Producers and Insurers must keep records of their transactions for how long?

A

At-Least 5 years after the transaction was completed.

46
Q

An insurers is required to provide a Buyer’s Guide to all prospective buyers before accepting the initial premium, unless?

A

unless the buyer has a free-look period of at least 14 days. Then the guide must be delivered with the policy, or before it.

47
Q

An insurer must notify its current customer of its privacy policies or practices how often?

A

At least once every year.

48
Q

Life insurance policies must contain a free look period during which the policyowner can examine the policy and return if for a full refund of premium if not satisfied. How long is the free look period?

A

14 days

49
Q

Who governs how insurers and agents treat personal health information and personal financial information from individuals?

A

The Privacy of Consumer Financial and health information Regulation

50
Q

Agents must complete at least how many hours of continuing education every two years in order to renew a license?

A

24 hours

51
Q

An agent must notify the Dept. within how many days of a change in name, Address, phone number, or email?

A

Within 30 days

52
Q

How long does an agent have to notify the Dept. after being found guilty, pleading guilty, or no contest to a felony or crime punishable by imprisonment of one year or more?

A

30 days

53
Q

Term used for when an agent tells an applicant they are required to purchase specific ancillary coverage when they aren’t, telling the applicant that ancillary coverage is included with no extra fee, but there is an extra fee, or charging applicants for ancillary coverage without the applicants consent.

A

Sliding

54
Q

Term used for forcing or compelling someone to purchase an insurance policy through the use of threats, intimidation, or manipulation.

A

Coercion

55
Q

Term for making false claims about financial condition of an insurance company or any statement designed to injure anyone in the insurance business.

A

Defamation

56
Q

Term for when people of the same class or equal risks are charged diff premiums or coverages.

A

Unfair discrimination

57
Q

Term for making a false statement or comparison to induce someone to drop coverage or go with a different insurance company.

A

Twisting

58
Q

The term used for using values of an existing life policy to purchase another policy w/o reasonable basis that the new policy will provide the policyowner any actual benefit. (usually to increase the agents commission)

A

Churning

59
Q

Insurers typically can NOT invest in what?

A

Gold and currencies.

60
Q

An applicant for an insurance license CANNOT take the state exam more than how many times in a 12 month period?

A

5 times

61
Q

It is unfair claims settlement practice for insurers to fail to affirm or deny coverage of claims within how many days after receiving proof of loss statements?

A

Within 30 days

Florida Health Insurance (14 decks)

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