Chapter 1 Quiz - completing the application, underwriting, and delivering the policy

Which of the following statements is NOT true concerning insurable interest as it applies to life insurance?

A debtor has an insurable interest in there life of a lender

In insurance, an offer is usually made when

An applicant submits an application to the insurer

Which of the following is a generic consumer publication that explains life insurance in general terms in order to assist the applicant in the decision -making process ?

Buyer's guide

To legally transact insurance in this state an insurer must obtain which of the following?

Certificate of authority

All of the following are duties and responsibilities of producers at the time of application EXCEPT

Change any incorrect statement in the application by personally initialing next to the corrected statement

What do individuals use to transfer their risk of loss rot a larger group ?

Insurance

The medical information Bureau (MIB) was created to protect

Insurance companies from adverse selection by high risk persons

What is the purpose of a conditional receipt?

It is intended to provide coverage on a date prior to the policy issue.

Which of the following best details the underwriting process for life insurance?

Selection, classification, and rating of risks

Which of the following statements is correct about a standard risk classification in the same age group and with similar lifestyles?

Standard risk is representative of the majority of people.

Which of the following insurers are owned by stockholders?

Stock

What is the purpose of a buyer's guide ?

To allow the consumer to compare the costs of different policies

What is the timeframe for filing relevant suspicious activity reports?

Within 30 days of initial discovery

What is the major difference between a stock company and a mutual company?

ownership