Completing the Application, Underwriting, and delivering the policy QUIZ

If a policy includes a free-look period of at least 10 days, the Buyer's Guide may be delivered to the applicant

A. With the policy.

Which of the following best describes the concept that the insured pays a small amount of premium for a large amount of risk on the part of the insurance company?

Aleatory

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

If an applicant for a life insurance policy is found to be a substandard risk, the insurance company is most likely to

Charge a higher premium.

Which of the following includes information regarding a person's credit, character, reputation, and habits?

Consumer report

A producer agent must do all of the following when delivering a new policy to the insured EXCEPT

Disclose commissions earned from the sale of the policy.

If a change needs to be made to the application for insurance, the agent may do all of the following EXCEPT

Erase the incorrect answer and record the correct answer.

Which of the following best describes the MIB?

It is a nonprofit organization that maintains underwriting information on applicants for life and health insurance.

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 (blank)

Premium Receipt

Another name for a substandard risk classification is (blank)

Rated

Which is the appropriate action by the insurer if a prospective insured submitted an incomplete application?

Return the application to the applicant for completion

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 insurer waived its right to have an answer on the application.

What is the purpose of the buyer's guide?

To allow the consumer to compare the costs of different policies

Why should the producer personally deliver the policy when the first premium has already been paid?

To help the insured understand all aspects of the contract

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