Chapter 7

Which of the following is NOT a risk classification that an underwriter would use?

Dividend Risk (Underwriters classify insurance risks as all of these EXCEPT "Dividend risk".)

Which of the following types of information is NOT required for a life insurance application?

Ethnicity (Ethnicity is not required information needed for a life insurance policy.)

Most U.S. life insurance companies belong to the

Medical Information Bureau (Nearly every life insurer in the United States belongs to the Medical Information Bureau.)

What are members of the Medical Information Bureau (MIB) required to report?

Medical ailments discovered during the underwriting process (Members of the Medical Information Bureau are required to report medical impairments found during the underwriting process.)

Which of the following is NOT an important reason for a life insurance application?

The beneficiary must sign the application before the insurer will issue the policy. (A life insurance application is important for all of these reasons EXCEPT ​ "The beneficiary must sign the application before the insurer will issue the policy".)

The objective of underwriting is to

avoid selecting a disproportionate amount of bad risks (The goal of underwriting is to avoid selecting a disproportionate number of bad risks.)

A report which is based on creditworthiness and personal characteristics that influences an insurance applicant's eligibility for life and health insurance ​ is called a(n)

consumer report (A consumer report influences an insurance applicant's eligibility for life and health insurance and is based on creditworthiness and personal characteristics.)

The Medical Information Bureau consists of

life and health insurance companies (Life and health insurers are members of the Medical Information Bureau.)

When an applicant applies for insurance, the process by which the insurer determines whether to issue a policy is called

underwriting (When an applicant applies for insurance, the process by which the insurer determines whether to issue a policy is called underwriting.)

An applicant has revealed conditions that require more information. Which of the following is needed next?

Attending physician's statement (An attending physician's statement (APS) is needed in cases in which the individual application and/or medical reports reveal conditions of which more info is required. The applicant must sign a written release to enable a release of the APS)