Florida Insurance Licensing Practice Exam

Which is TRUE concerning Joint Underwriting Associations, EXCEPT?

1. Operations overseen by a board of governors

2. Policyholders must be unable to purchase coverage on the open market

3. Citizens replaced FRP&CJUA and Florida Windstorm

4. It is not possible to purchase a Homeowners or Dwelling Policy from Citizens

The correct answer is: It is not possible to purchase a Homeowners or Dwelling Policy from Citizens

Joint Underwriting Associations (JUAs) are state-run programs designed to provide insurance coverage to those who are unable to obtain it in the private market. Policyholders of JUAs must be unable to purchase coverage on the open market, making option B true. Option A is incorrect because operations of JUAs are overseen by a governing board, not just a board of governors. Option C is incorrect because Citizens, Florida Residential Property and Casualty Joint Underwriting Association (FRP&CJUA), and Florida Windstorm Joint Underwriting Association (FWJUA) are all different entities. Citizens was created to insure high-risk homeowners in Florida, while FRP&CJUA covered commercial and non-residential properties, and FWJUA provided windstorm coverage only. Therefore, option D is the only incorrect statement as it is possible to purchase Homeowners or Dwelling Policies from