Chapter 5 - Life Insurance Underwriting and Policy Issue

The USA Patriot Act was enacted in:

2001

When a policyowner cash surrenders a Universal Life Insurance policy in it's early years, this may be considered a red flag for a(n):

Anti-Money Laundering violation

Any changes made on an insurance application requires the initials of whom?

Applicant

At what time must a policyowner have insurable interest on the insured in order for the life policy to be valid?

At the time of application

A student pilot can pay regular premium costs for her life insurance policy with the addition of which of the following?

Aviation exclusion

Who is NOT required to sign a life insurance application?

Beneficiary

On August 6, D submitted an application for a $50,000 Life Insurance policy and did not pay the initial premium. On August 18, D went to his doctor complaining of chest pains and some tests were given by the doctor. The life policy was delivered by the producer on August 20 and D explains what had recently taken place with the doctor. What action should the producer then take?

Collect initial premium along with a signed health statement

Which of these actions should a producer take when submitting an insurance application to an insurer?

Inform insurer of relevant information not included on the application

All of these are considered sources of underwriting information about an applicant, EXPECT:

Rating Services

Agent J takes an application and initial premium from an applicant and sends the application and premium check to the insurance company. The insurance company returns the check back to J because the check is made out to J instead of the insurance company. What action should J take?

Return to the customer, collect a new check made out to the insurance company, and send the new check out to the insurance company

An applicant's medical information received from the Medical Information Bureau (MIB) may be furnished to the

applicant's physician

Consumer reports requested by an underwriter during the application process of a life insurance policy can be used to determine:

probability of making timely premium payments