Multiple Choice
Identify
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1.
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Jim Whelan promised his golf partner that he would
pay the fees for the next round of golf if his partner would switch his auto coverage to a company
Jim represents. Realizing his policy was up for renewal, the golf partner bought a policy
recommended by Jim. What, if any, ethical issues are involved?
a. | Jim is guilty of rebating, which is both unethical and
illegal | b. | Jim is guilty of rebating only if he actually paid the
golf fees | c. | Since the partner
needed insurance coverage anyway, no ethical or legal issue is involved | d. | Jim would be guilty of rebating only if the golf fees exceeded
$100 |
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2.
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In addition to possible fines and possible
incarceration, agents who solicit, negotiate or sell coverage issued by an unauthorized insurer
face:
a. | civil liability for all unpaid claims
| b. | revocation of all insurance
licenses | c. | suspension of all insurance
licenses | d. | all of the above |
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3.
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Which of the following fiduciary responsibilities
does an appointed agent owe the carrier?
a. | duty to remit premium collections in a timely
manner | b. | duty to disclose any conflicts of
interest | c. | duty to solicit profitable business for the
carrier | d. | all of the above |
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4.
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Which of the following measures were prompted as a
response to Hurricane Andrew:
a. | Citizen's Property Insurance
Company | b. | Florida Hurricane Catastrophe Fund
| c. | building code reforms | d. | all of the
above |
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5.
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Which of the following has the greatest fiduciary
responsibility to insurance purchasers?
a. | captive agents | b. | independent agents | c. | insurance
brokers | d. | all of the above have equal responsibilities to the
insurer |
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6.
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What is potentially the most serious ethical issue
in the approach step of the sales process?
a. | The agent’s discussion of a product over the
telephone | b. | The agent’s
stating or implying that he or she has skills, experience or credentials that are not possessed
| c. | The agent’s failure to provide a complete
comparison | d. | The agent’s
failure to provide full disclosure of all facts |
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7.
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What mandatory continuing education topics must a
Florida-licensed property/casualty agent complete every two years?
a. | 3 credits in Ethics | b. | 1 credit in Hurricane Premium
Discounts | c. | 3 credits in Senior Suitability | d. | a and b only |
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8.
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Which of the following is a fundamental method of
resolving disputes?
a. | Reason | b. | Force | c. | Both a and b
| d. | Neither a nor b |
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9.
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What makes a system of ethics
essential?
a. | A limited supply of goods | b. | Because individuals exist in society | c. | Its fairness | d. | It is the only
method to adjudicate disputes |
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10.
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Which facets of the My Safe Florida Home program
are still in operation?
a. | matching grants for hurricane mitigation
efforts | b. | free inspections of existing homes for hurricane
mitigation | c. | certification of
mitigation inspectors and mitigation contractors | d. | all of the
above |
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11.
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A client can reasonably expect insurance agents
to:
a. | perform due diligence of the products an agent
offers | b. | perform due diliegence of the companies an agent
represents | c. | submit
applications and claim forms to the insurer in a timely manner | d. | all of the
above |
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12.
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Agents must notify the Department of Financial
Services of changes to their contact information (physical addresses, email, and phone number) no
later than ____ days after the change.
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13.
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Under what circumstances may an insurance agent
claim affiliation with a government agency as a means of suggesting governmental
approval?
a. | If the agent is a registered investment adviser
| b. | If the agent has a Series 6 or Series 7 registration
with FINRA | c. | Upon application
to the SEC | d. | never |
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14.
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What is the common thread in unethical sales
practices?
a. | The practices are illegal | b. | They mislead the customer | c. | They lead to the customer’s monetary loss | d. | They are forbidden by all insurers |
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15.
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The Department will revoke an agent's license
for a line of insurance if the agent remains unappointed for that line for more than:
a. | 24 months | b. | 36 months | c. | 48
months | d. | 60 months |
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16.
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For misrepresentation to be unethical, it must be:
a. | intentional | b. | unintentional | c. | either a or
b | d. | neither a nor b |
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17.
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Which of the following is the foundation of ethics
for the financial services agent?
a. | The Golden Rule | b. | The legal system | c. | Force
| d. | Compliance
requirements |
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18.
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A homeowner wishes to reduce the cost of her
windstorm insurance premium. What alternatives are available to her?
a. | retrofit her home to meet the Florida Building
Code | b. | increase the policy's
deductible | c. | seek out coverage
from a different windstorm insurer | d. | all of the above
could reduce her premium cost |
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19.
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Under current Florida law, an agent convicted of
selling coverage issued by an authorized insurer is guilty of:
a. | a third degree misdemeanor | b. | a second degree misdemeanor | c. | a first degree misdemeanor | d. | a third degree felony |
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20.
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Uniform Mitigation Verification forms completed by
an approved inspector are valid for a period of:
a. | 3 years | b. | 4 years | c. | 5
years | d. | 10 years |
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21.
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Which of the following has the greatest fiduciary
responsibility to the insurer?
a. | captive agents | b. | independent agents | c. | insurance
brokers | d. | all of the above have equal responsibilities to the
insurer |
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22.
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All residential property insurers in Florida must
discount their premiums if homeowners install hurricane mitigation improvements. Those
discounts or premium credits apply to:
a. | the policy's entire premium
| b. | only the windstorm portion of the policy's
premium | c. | only properties located in the wind-borne debris
region | d. | none of the above |
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23.
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All windstorm insurers must notify their
policyholders, in writing, of:
a. | the insured property’s rating under the Uniform
Home Grading Scale (UHGS) | b. | any applicable
premium discounts or credits available for hurricane mitigation retrofits | c. | the company's participation in the "Blueprint for Safety"
program | d. | whether the insured property is located in the
wind-borne debris region |
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24.
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Which of the following is NOT an authority
conferred under the law of agency?
a. | Express authority | b. | Suggested authority | c. | Implied authority
| d. | Apparent authority
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25.
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An agent has an ethical duty to disclose which of
the following to his or her clients:
a. | all facts concerning a recommended
product | b. | all material facts concerning a recommended
product | c. | the terms of his or her contract of agency
| d. | all of the above |
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