Florida Life and Health Insurance License Practice Test 2025 - Free Insurance Practice Questions and Study Guide

The insurer will likely take this action because committing arson is a deliberate act that violates the terms of the insurance policy. As a result, the insurer has the right to cancel the policy and recover any payments made to the insured. Option A is incorrect because paying the claim as usual would go against the terms of the policy. Option B is incorrect because increasing the premium would not address the issue of the policy being violated. Option D is incorrect because offering a settlement would not address the issue of the policy being violated.