Chapter 6: Life Underwriting

Under US a patriot act, insurers are required to report receipt of cash payments in excess of

$10,000. The anti-money laundering provisions of the USA Patriot act requires insurance to report any cash payments received that are greater than $10,000

All are true statements regarding underwriting process, except?

Aids and HIV virus exams can be conducted in a discriminatory fashion, aids and hiv testing must be conducted in a uniform fashion and cannot be discriminatory.

Before a life insurance policy is issued, which of the components of the contract is required?

Applicant signature on application

On August 6, d Submitted an application of $50,000 life insurance policy and did not pay the initial premium. On August 18, he went to the doctor complaining of chest pain's and some tests were given by the doctor. The life policy was delivered by the producer on August 20 and D explains what I 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

On January 8, and applicant filled out an application for life insurance policy but did not include the initial premium. The insurance company approved the application on January 14 and issued the policy January 15 the producer delivered the policy on January 26 and collected the first premium. When did the coverage become effective ?

January 26, coverage became effective on the date the policy was delivered and first premium collected

Q applied for life insurance and submitted the initial premium on January 1. The policy was issued February 1, but it was not delivered by the agent until February 7. Q is dissatisfied and returns the policy February 13. How will the insurer handle this situation?

Policy was returned within the free-look period, premium will be fully refunded

All of these are considered sources of underwriting information about an applicant except

Rating Services

Which factors are taken into consideration when an insurance company determines the premium rate of whole life policy on an applicant?

Risk classification

ABC insurance company has excepted a life insurance application which contains unanswered questions. The company that makes the application part of the life contract. In this situation, the insurer has:

Wavered one of its legal rights

An agent gives a conditional receipt to a client for an insurance policy after collecting the initial premium. When will the policy become effective?

When the conditions of the receipt are met

A life insurance application must be signed by all these except

beneficiary

And incomplete life insurance application submitted to an insurer will result in which of these actions?

Application will be returned to writing agent.

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

At the time of application