Field Underwriting Procedures
Something of value exchanged between the insurer and the insured is considered an...
Consideration
When an insured makes truthful statements on the application for insurance and pays the required premium, it is known as which of the following?
Consideration
Contracts that are prepared by one party and submitted to the other party on a take-it-or-leave-it basis are classified as...
Contracts of adhesion
Which of the following is NOT an essential element of an insurance contract?
Counteroffer
What phase begins after a new policy is delivered?
Free-look period
Pre-existing conditions are defined as...
Illnesses for which the insured sought medical treatment prior to policy issue
A life insurance policy has a legal purpose if both of which of the following elements exist?
Insurable interest and consent
Which of the following entities can legally bind coverages?
Insurer
Who must pay for the cost of a medical examination required in the process of underwriting?
Insurer
Which document is used to assess risk associated with an applicant's lifestyle and character?
Investigative Consumer Report
All of the following are true regarding the Medical Information Bureau (MIB) EXCEPT...
MIB reports are based upon information supplied by doctors and hositals
Which of the following information regarding an insured is NOT included in an Investigative Consumer Report, which is requested by an underwriter?
Medical History
An insurance company wants to obtain the insurance history of an applicant. Which source releases coded information to insurers regarding information included on previous insurance applications?
Medical Information Bureau
An applicant for a health insurance policy returns a completed application to her agent, along with a check for the first premium. She receives a conditional receipt two weeks later. Which of the following has the insurer done by this point?
Neither approved the application nor issued the policy
Which of the below statements is FALSE regarding the process of completing and signing an application?
Only the insured is required to sign the applicatoin
An insurer wishes to compare the information given in an insurance application with previous insurance applications by the same applicant but for different companies. What organization can help the insurer accomplish this?
The Medical Information Bureau
If an applicant does not receive a new insurance policy, who would be held responsible?
The agent
Whose responsibility is it to determine if all of the questions on an application have been answered?
The agent
An insurer is attempting to determine the insurability of an applicant and decides to obtain medical information from several different sources. Which entity must be notified of the investigation?
The applicant
Which of the following is NOT the consideration in a policy?
The application given to a prospective insured.
Which of the following is true regarding health insurance underwriting for a person with HIV?
The person may not be declined for medical coverage solely based on HIV status.
When delivering a policy, which of the following is an agent's responsibility?
Collect payment at time of delivery (if payment has not already been collected)
In insurance, an offer is usually made when
The completed application is submitted
In terms of parties to a contract, which of the following does NOT describe a competent party?
The person must have at least completed secondary education.
An insured is upset that her new health insurance policy was delivered to her by certified mail and not through her agent. Which of the following is true?
There is nothing wrong with this form of policy delivery
If only one party to an insurance contract has made a legally enforceable promise, what kind of contract is it?
Unilateral
In insurance policies, the insured is not legally bound to any particular action in the insurance contract, but the insurer is legally obligated to pay losses covered by the policy. What contract element does this describe?
Unilateral
In forming an insurance contract, when does acceptance usually occur?
When an insurer's underwriter approves coverage
An agent is ready to deliver a policy to an applicant but has not yet received payment. Upon delivery, the agent collects the applicant's premium check, answers any questions the applicant may have, and then leaves. What did he forget to do?
Ask her to sign a statement of good health.
In a replacement situation, all of the following must be considered EXCEPT...
Assets
What documents describes an insured's medical history, including diagnoses and treatments?
Attending Physician's Statement
Who is involved in completing the agent's report?
Only the Agent
Something of value exchanged between the insured is considered an...
Consideration
An insurance contract must contain all of the following to be considered legally binding EXCEPT...
Beneficiary's consent
All of the following are utilized by an underwriter in order to underwrite an applicant EXCEPT...
Birth Certificate
An insurance contract requires that both the insured and the insurer meet certain conditions in order for the contract to be enforceable. What contract characteristic does this describe?
Conditional
The proposed insured makes the premium payment on a new insurance policy. If the insured should die, the insurer will pay the death benefit to the beneficiary if the policy is approved. This is an example of what kind of contract?
Conditional
When both parties to a contract must perform certain duties and follow rules of conduct to make the contract enforceable, the contract is...
Conditional
Because an insurance policy is a legal contract, it must conform to the state laws governing contracts which require all of the following elements EXCEPT...
Conditions
An insurer neglects to pay a legitimate claim that is covered under the terms of the policy. Which of the following insurance principles has the insurer violated?
Consideration
Before a customer's agent delivers his policy, he insurer makes a last-minute change to the policy. The agent informs the customer of this change, and he accepts it. What must the agent do now?
The agent should ask the customer to sign a statement acknowledging that he is aware of the change.
Mr. R. purchases a health insurance policy for his daughter, who recently graduated from college. The daughter receives the required medical examination, and the insurance application. Who needs to sign the application?
The agent, Mr. R., and his daughter
In which of the following examples would a contract between an insurer and prospective insured be legal?
The applicant has a prior felony conviction
Which is true regarding obtaining underwriting sources?
The applicant must be informed of the sources contacted and how the information is being gathered.
Which of the following is true about the requirements regarding HIV exams?
The applicant must give prior informed written consent