Florida Life and Health Insurance License Practice Test

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Prepare for the Florida Life and Health Insurance License Test. Study with flashcards and multiple choice questions, each with hints and explanations. Get ready for your certification exam with ease!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

When must insurable interest exist in a life insurance contract?

At the inception of the contract
At the time of claim
Throughout the policy term
After the policy has lapsed

The correct answer is: At the inception of the contract

In a life insurance contract, insurable interest must exist at the inception of the contract. This means that the person taking out the policy must have a financial interest in the life of the insured. This ensures that the insurance policy is not being taken out for fraudulent reasons. Option B is incorrect because insurable interest must exist when the contract is entered into, not just at the time of claim. Option C is incorrect because the insurable interest must remain throughout the policy term, not just at certain points in time. Option D is incorrect because insurable interest is required from the beginning of the contract, not just after it has lapsed.