Insurers & Auto Insurance
Types of Insurers
Florida General Lines also tests the types of insurers and insurance markets that operate in the state.
Admitted Insurers: An admitted insurer is one that is authorized to do business in Florida and holds the proper certificate of authority. These insurers operate under Florida’s regulatory framework and normal admitted-market rules.
Reciprocal Exchanges: A reciprocal exchange is an unincorporated arrangement in which subscribers insure one another, typically through an attorney-in-fact. This is a classic structure question.
Surplus Lines
Surplus lines insurers operate outside the admitted market and are used when coverage cannot be obtained from authorized insurers under the proper rules. Florida tests this area because it is important in high-risk property markets.
Florida Surplus Lines Service Office: Florida uses a surplus lines framework that includes oversight and procedural requirements.
Eligibility for Export: The exam may test when a risk may be exported to the surplus lines market.
Residual Market
Florida has residual market mechanisms for risks that cannot obtain coverage in the ordinary voluntary market. These are very testable.
Citizens Property Insurance Corporation (Citizens): Citizens is Florida’s residual market property insurer. It exists to provide property insurance when coverage is not otherwise available through the standard market under qualifying circumstances.
Why it matters: Because of Florida’s property environment, Citizens is a major exam topic.
Florida Automobile Joint Underwriting Association (FAJUA): FAJUA is Florida’s residual market mechanism for certain auto insurance risks that cannot obtain coverage in the regular market.
Workers Compensation Joint Underwriting Association (WCJUA): WCJUA serves as the residual market for employers unable to obtain workers compensation insurance in the standard market.
Auto Insurance
Florida auto law is one of the most heavily tested parts of the General Lines exam. You should know:
- Required coverages
- Financial responsibility rules
- Personal injury protection
- UM/UIM concepts
- Cancellation and nonrenewal
- Motorcycle rules
Required Coverages
Financial Responsibility Law: Florida requires certain drivers to be financially responsible for damages they may cause. The exam often tests whether a driver has met the state’s financial responsibility requirements.
Personal Injury Protection (PIP): Florida is strongly associated with PIP. PIP is a required coverage concept that pays certain medical and related expenses regardless of fault, subject to Florida law and policy terms.
Limits: The exam may ask what minimum limits apply or whether a driver met Florida requirements. These questions often test whether the insured carried the correct required coverage and amount.
Uninsured / Underinsured Motorists Coverage
UM/UIM coverage protects the insured when the at-fault driver has no insurance or insufficient insurance.
Why it matters: These questions often test whether the coverage was offered, rejected, or how it applies in a loss scenario.
Cancellation / Nonrenewal
Florida also regulates cancellation and nonrenewal of personal auto policies. As with other lines, the exam often tests:
- Whether notice was proper
- Whether the reason was allowed
- Whether the action was cancellation or nonrenewal
Motorcycle Coverage
Motorcycle insurance questions are often used to test whether students assume motorcycles are treated exactly like personal autos. Be careful. The exam may test differences in required coverage or policy treatment.