Life insurance: Completing the application, underwriting, and delivering the policy
If a telemarketer wants to make an unsolicited sales call to a potential customer, what is the earliest time the telemarketer can call the prospect's residence? - 7 am - 8 am - 9 am - noon
8 am - Permissible calling hours for telemarketers are between 8am and 9pm
According to the telemarketing sales rule, what are the permissible calling hours for telemarketing calls? - 7am until 9pm - 8an until 9pm - 10am until 10pm - 7am until 7pm
8am until 9pm -
Which of the following statements is NOT true concerning insurable interest as it applies to life insurance? - A debtor has an insurable interest in the life of the lender - Business partners have an insurable interest in each other - A husband or wife has an insurable interest in their spouse - An individual has an insurable interest in his or her own life
A debtor has an insurable interest in the life of the lender - A lender has an insurable interest in the life of a debtor, but only to the extent of the debt. The debtor does not have an insurable interest in the life of the lender
Which is the primary source of information used for insurance underwriting? - Application - Applicant interviews - Medical records - Private investigations
Application - the application contains most of the information used for underwriting purposes, this is why its completeness and accuracy are so crucial
What describes the specific information about a policy? - Illustrations - Buyer's guide - Producer's report - Policy summary
Policy summary - a policy summary describes the features and elements of the specific policy for which a person is applying
Which of the following entities established the Do Not Call Registry - The NAIC - The Consumer Protection Agency - The Federal Trade Commission - The Better Business Bureau
The Federal Trade Commission - established the do-not-call list in order to protect consumers against unwanted solicitations
The National Do Not Call Registry was created to regulate - Insurers - Insurance solicitors - Telemarketers - Field Underwriters
Telemarketers - the National Do Not Call Registry was created to allow consumers the choice to not be contacted by telemarketers
Which of the following regulatory authorities participated in creating the National Do Not Call Registry? - FTC - SEC - NAIC - BBB
FTC (The Federal Trade Commission) - and the Federal Communications Commission (FCC) created the National Do Not Call Registry, allowing consumers to include their telephone numbers on the list to which solicitation calls cannot be made by telemarketers
Which of the following would be considered a nonmedical insurance application? - An application that does not ask any questions about the applicant's medical history - An application submitted with the Agent's Report - Any application for life insurance - An application on which the medical information is completed by the applicant and the agent only
An application on which the medical information is completed by the applicant and the agent only - An application on which the medical information is completed by the applicant and the agent only
An insurer want to begin underwriting procedures fro an applicant. What source will it consult for the majority of its underwriting information? - Interviews - State records - Medical records - Application
Application - the application contains most of the information used for underwriting purposes. This is why its completeness and accuracy are so crucial
The full premium was submitted with the application for life insurance, and the policy was issued two weeks later as requested. When does the policy coverage become effective? - As of the policy issue date - As of the application date - As of the policy delivery date - As of the first of the month after the policy issue
As of the application date - If the full premium was submitted with the application and the policy was issued as requested, the policy coverage effective date would generally coincide with the date of application
An insured stated on her application for life insurance that she had never had a heart attack, when in fact she had a series of minor heart attacks last year for which she sought medical attention. Which of the following will explain the reason the death benefit claim is denied? - Estoppel - Material misrepresentation - Waiver - Utmost Good Health
Material misrepresentation - a material misrepresentation will affect whether or not a policy is issued. If the insured had been truthful, it is very likely that the policy would not be issued
An applicant signs an application for a $25,000 life insurance policy, pays the initial premium, and receives a conditional receipt. If the applicant is killed in an automobile accident the next day, - The premium would be returned to the insured's estate because the policy was not issued - The company could reject the death claim because the underwriting process was never completed - The company could reject the application on the basis that the insured's death was not caused by an ongoing medical problem - The beneficiary would receive $25,000 if it was determined that the insured qualified for the policy applied for
The beneficiary would receive $25,000 if it was determined that the insured qualified for the policy applied for - the conditional receipt provides that when the applicant pays the initial premium, coverage is effective on the condition that the applicant proves the be insurable either on the date the application was signed or the date of the medical examination, if one is required
An agent and an applicant for a life insurance policy fill out and sign the application. However, the applicant does not wish to give the agent the initial premium, and no conditional receipt is issued. When will coverage begin? - On the application date - When the agent submits the application to the company and the company issues a conditional receipt - When the agent delivers the policy, collects the initial premium, and the applicant completes and acceptable Statement of Good Health - On the designated effective date
When the agent delivers the policy, collects the initial premium, and the applicant completes and acceptable Statement of Good Health - If the initial premium is not paid with the application, the agent will be required to collect the premium at the time of policy delivery. In this case, the applicant will most likely need to fill out a Statement of Good Health
The full premium was submitted with the application for life insurance, and the policy was issued two weeks later as requested. When does the policy coverage become effective? - As of the application date - As of the policy delivery date - As of the first of the month after the policy issue - As of the policy issue date
As of the application date - if the full premium was submitted with the application and the policy was issued as requested, the policy coverage effective date would generally coincide with the date of application
Which of the following will be included in a policy summary? - Copies of illustrations and application - Comparisons with similar policies - Primary and secondary beneficiary designations - Premium amounts and surrender values
Premium amounts and surrender values - a policy summary must be delivered along with the policy and will provide the producer's name and address, the insurance company's home office address, the generic name of the policy issued, and premium, cash value, surrender value and death benefit figures for specific policy years
Most agents try to collect the initial premium for submission with the application. When an agent collects the initial premium from the applicant, the agent should issue the applicant a - Statement of good health - Backdated receipt - Warranty - Premium receipt
Premium receipt - when collecting the initial premium, the agent should issue the applicant a premium receipt
Which is the appropriate action by the insurer if a prospective insured submitted an incomplete application? - Return the application to the applicant for completion - Issue a policy anyway since the application has been submitted - Ask the producer who solicited the policy to complete and resign the application - Fill in the blanks to the best of the insurer's knowledge
Return the application to the applicant for completion - any unanswered questions need to be answered before the policy is issued. If the insurer receives incomplete application, they need to be returned to the applicants for completion
Upon policy delivery, the producer may be required to obtain any of the following EXCEPT - Statement of good health - Payment of premium - Delivery receipt - Signed Waiver of premium
Signed Waiver of premium - the policy does not go into effect until the premium has been collected. If the premium was not collected at the time of the application, the producer may also be required to get a Statement of Good Health from the applicant at the time of policy delivery. Waiver of premium is a rider that can be added to a life insurance policy, and not something to be obtained from the applicant
If an insurer issued a policy based on the application that had unanswered questions, which of the following will be TRUE? - The policy will be interpreted as if the insured did not have an answer to the question - The policy will be void - The insurer may deny coverage later, because of the information missing on the application - Then policy will be interpreted as if the insurer waived its right to have an answer on the application
Then policy will be interpreted as if the insurer waived its right to have an answer on the application - any unanswered questions need to be answered before the policy is issued. If a policy is issued with questions left unanswered, the contract will be interpreted as if the insurer waived its right to have an answer for the question, and will not be able to deny coverage later because of unanswered questions
What is the purpose of the buyer's guide? - To allow the consumer to compare the costs of different policies - To provide the name and address of the agent/producer issuing the policy - To list all policy riders - To provide information about the issued policy
To allow the consumer to compare the costs of different policies - the buyer's guide provides generic information about life insurance policies and allows the consumer to compare the costs of different policies. The policy summary provides specific information about the issued policy, as well as the insurer's information
Who makes up the Medial Information Bureau? - Former insured - Physicians and paramedics - Insurers - Hospitals
Insurers - the Medical Information Bureau is made up of insurers so the companies can compare the information they have collected on a potential insured with information other insurers may have discovered
Which of the following would NOT be considered an exception to the National Do Not Call List? - Calls for which the consumer has given prior written permission - Calls which are not commercial or do not include unsolicited advertisements - Calls by or on behalf of tax-exempt nonprofit organizations - Calls based from outside of the United States
Calls based from outside of the United States -
What was created to keep telemarketers from calling consumers who do not wish to be contacted? - National Do Not Call Registry - Confidential No Call Act - Freedom of Information Act - Call Control Registry
National Do Not Call Registry - was created to allow consumers the choice to not be contacted by telemarketers
If an applicant for a life insurance policy and person to be insured by the policy are two different people, the underwriter would be concerned about - Whether an insurable interest exists between the the individuals - The gender of the applicant - The type of policy requested - Which individual will pay the premium
Whether an insurable interest exists between the the individuals - an insurable interest must exist at the time the policy is issued. Some relationships are automatically presumed to qualify as an insurable interest, e.g. spouses, parents, children and certain business relationships
