Underwriting and Policy Issue

All are true statements regarding the underwriting process, EXCEPT:

AIDS and HIV virus exams can be conducted in a discriminatory fashion

When a policy owner cash surrenders a Universal Life Insurance Policy in its early years, this may be considered a red flag for a(n)

Anti money Laundering Violation

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

Applicant

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

Applicant's Physician

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

Applicant's signature on application

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

Application will be returned to the writing agent

A life insurance application must be signed by all of these, EXCEPT

Beneficiary

Who is NOT required to sign a life insurance application

Beneficiary

Which of the following correctly explains the actions an urgent should take if a customer wants to apply for an insurance policy?

Complete the application and review the information with the customer prior to obtaining the customers signature, then send the application off to the insurance company

T applies for a life insurance policy and is told by the producer that the insurer is bound to the coverage as of the date of the application or medical examination, whichever is later, provided that T is an acceptable risk. What item is given to T?

Conditional receipt

From what authority derives the requirement that an insurance application contains a disclosure stating that an investigative consumer report may be obtained on an applicant?

Fair Credit Reporting Act

Which Federal law allows an insurer to obtain an inspection report on a potential insured?

Fair Credit reporting act

What action should a producer take if the initial premium is NOT submitted with the application

Forward the application to the insurer without the initial premium

M completes an application for life insurance but does not pay the initial premium. All of these actions must occur before M's policy goes into effect EXCEPT

Free look period has expired

An Insurance company may NOT reject a prospective insured's life application on the basis of which of the following factors?

Gender

In order for coverage on a non-medical insurance application to take effect the same day, the producer must collect a signed application and

Initial premium

P completes an application for a $10,000 life policy, but does not give the producer the initial premium. P's coverage becomes effective when

P receives the policy and pays the premium

Which of these do NOT constitute policy delivery?

Policy issued with a rating

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

A medical Information Report (MIB) may disclose which of the following

Prior use of marjuana

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

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

Rating Services

What would the Medical Information Bureau (MIB) identify?

Testing positive for marijuana use from a previous screening

Why is an applicant's signature required on a life insurance application

To attest that the statements on the application are accurate to the best of the applicants knowledge

Which parts of a life insurance policy are guaranteed to be true?

Warranty

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

Information obtained from a phone conversation to the proposed insured can be found in which of these reports?

Inspection report

What is being delivered during a policy delivery?

Insurance contract to the proposed insured

What is the purpose of a Policy Summary

It highlights the critical parts of the policy issued

When does a life insurance contract become effective if the initial premium is not collected during the application process

When producer delivers policy and collects initial premium

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

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

Under the USA Patriot Act, insurers are required to report receipt of cash payments in excess of

10,000

The USA Patriot Act was enacted In

2001

Which of these terms accurately defines an underwriters assessment of information on a life insurance application?

Risk Classification

P is a producer who notices 5 questions on a life application were not answered. What actions should P take?

Set up a meeting with the applicant to answer the remaining questions

Upon delivery of a rated life insurance policy, the Producer must obtain each of the following EXCEPT

Signed HIPAA disclosure

On delivery of a policy, a signed statement of good health is typically requested if:

The application was submitted without the Initial Premium

K is an agent who takes an application for individual life insurance and accepts a check from the client. He submits the application and check to the insurance company, however the check was never signed by the applicant. If the application is approved, when will coverage be effective?

The date the agent delivered the policy, collected the initial pre sum, and obtained a good health statement for the insured

K applies for a life insurance policy on herself and submits the initial premium with the application. She is given a receipt by the agent stating that coverage begins immediately if the application is approved. What kind of receipt was used?

conditional

What is the purpose of the U.S.A patriot Act

detect and deter terrorism

An underwriter determines that an applicant's risk should be recategorized due to a health issue. This policy may be issued with a(n)

exclusion for the medical condition

The reason for backdating a policy is

to obtain a premium rate based on an earlier age

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

A statement made by an insured in an insurance application that must be true to the best of one's knowledge and which becomes a part of the contract is known as:

a representation

ABC Insurance Company has accepted a life insurance application which contains unanswered questions. The company then makes the application part of the life contract. In this situation, the insurer has

waived one if its legal rights