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Lesson 2 Quiz

The following quiz is provided for your information to help you measure your retention level on the material covered within this lesson. It is not graded. Only the final examination is graded.

Answer or complete each question to the best of your knowledge and click on the "Check your answer" button. If your answer is incorrect, you will be instructed where to find the correct answer. It is not necessary to repeat the quiz if you exit this page; however, your answers will not be saved once you exit. This feature is provided for future practice purposes.

1

A life insurance contract is considered a valued contract because it pays a predetermined amount with no way to assess loss.

a) True
b) False
CORRECTTRY AGAIN (Lesson 2.2.4)
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2

In order for a contract to be legally binding, the process must include four elements. Match the following elements with their respective descriptions.

a) The process must include a proposal and approval of the proposal.
b) There must be a legal reason for the contract.
c) Monies must be exchanged.
d) All parties to the contract must be capable and adept.
a) Offer and Acceptance

b) Legal Purpose

c) Consideration

d) Competent Parties

(Lesson 2.1)
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3

Which of the following would NOT be considered "competent parties" in a life insurance contract?

a) Minors
b) Mentally impaired persons
c) Persons under the influence of alcohol or drugs
d) All of the above
CORRECTTRY AGAIN (Lesson 2.1.4)
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4

Insurable interest can be established in all of the following ways EXCEPT:

a) Love and affection
b) Sympathy for a neighbor
c) Blood relationships
d) Economic interest
CORRECTTRY AGAIN (Lesson 2.2.5)
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5
Contract Types

A(n) _______________ contains unequal contingencies on the potential for profit or loss upon both parties in the insurance contract.

a) Aleatory Contract
b) Unilateral Contract
c) Indemnity Contract
d) Valued Contract
e) Contract of Adhesion
CORRECTTRY AGAIN (Lesson 2.2.1)
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6

A life insurance contract is a(n) _________________ because buyers must adhere to the terms of the contract already in existence with no opportunity to negotiate terms, rates, values, etc.

a) Aleatory Contract
b) Contract of Adhesion
c) Unilateral Contract
d) Valued Contract
e) Indemnity Contract
CORRECTTRY AGAIN (Lesson 2.2.2)
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7

A(n) ______________ obligates one party (the insurer) in the contract.

a) Aleatory Contract
b) Contract of Adhesion
c) Unilateral Contract
d) Valued Contract
e) Indemnity Contract
CORRECTTRY AGAIN (Lesson 2.2.3)
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8

A(n) ____________________ pays a predetermined amount with no way to assess loss.

a) Contract of Adhesion
b) Indemnity Contract
c) Aleatory Contract
d) Unilateral Contract
e) Valued Contract
CORRECTTRY AGAIN (Lesson 2.2.4)
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9

A(n) ___________________ pays the amount of loss only thereby returning the insured to the same position he/she was in before the loss occurred.

a) Valued Contract
b) Contract of Adhesion
c) Indemnity Contract
d) Aleatory Contract
e) Unilateral Contract
CORRECTTRY AGAIN (Lesson 2.2.4)
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10

If fraud is discovered after the contract has been in force for _______ years, it cannot be contested and any otherwise legitimate claims cannot be denied based on fraud, misrepresentation or concealment.

a) one
b) two
c) three
d) four
CORRECTTRY AGAIN (Lesson 2.4)
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11

The voluntary surrendering of a legal, given right is known as:

a) the parol evidence rule.
b) estoppel.
c) a waiver.
d) misrepresentation.
CORRECTTRY AGAIN (Lesson 2.4)
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12

The __________________ prohibits making any additional verbal changes to a contract once it becomes a written document.

a) waiver
b) parol evidence rule
c) entire contract clause
d) policy beneficiary
CORRECTTRY AGAIN (Lesson 2.4)
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13

is the legal enforcement of a(n) .


Word bank: Estoppel, Waiver

Estoppel is the legal enforcement of a(n) Waiver.

Lesson 2.4Check your answer

14
Authority

____________ authority spells out in contract form the activities that the agent has the power to perform on behalf of the insurer?

a) Implied
b) Apparent
c) Express
CORRECTTRY AGAIN (Lesson 2.3.1)
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15

The appearance of power on behalf of the insurer through the actions or use of identifying materials by the agent, such as company advertising material, is called _____________ authority.

a) express
b) apparent
c) implied
CORRECTTRY AGAIN (Lesson 2.3.1)
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16

______________ authority is established through verbalization and occurs when appropriate actions are taken to carry out the authority granted to fulfill the principal's goals.

a) Apparent
b) Implied
c) Express
CORRECTTRY AGAIN (Lesson 2.3.1)
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17

It is absolutely necessary that the policyowner continue to have insurable interest in the insured until the insured dies.

a) True
b) False
CORRECT - CONGRATULATIONS on completing Lesson 2. Now complete Florida study manual Chapter 3 Questions for Review.TRY AGAIN (Lesson 2.2.5)
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