Field Underwriting Procedures

What "entitles" make up the Medical Information Bureau?

Insurers

Which report will provide the underwriter with the information about an insurance applicant's credit?

Investigative consumer report

If an agent makes a correction on the application for health insurance, who must initial the correct answer?

The applicant

What is the entire contract in health insurance underwriting?

The application and the policy issued

What is NOT the consideration in a policy?

The application given to a prospective insured

In health insurance, the policy itself and the insurance application form what?

The entire contract

What law protects consumers against the circulation of inaccurate or obsolete personal or financial information?

The fair credit reporting act

Who is responsible for paying the cost of a medical examination required in the process of underwriting?

The insurer

Who must sign a health insurance application?

The policyowner , the insured (If different) , and the agent

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

To comply with Fair Credit Reporting Act, when must a producer notify an applicant that a credit report may be requested?

At the time of the application

If an underwriter requires extensive information about the applicant's medical history, what report will best serve this purpose?

Attending physician's statement

What describes MIB?

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

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

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

What is NOT an essential element of an insurance contract?

Counteroffer

How may a policy be delivered to an insured?

Either in person through the agent or through the mail

What best describes the aleatory (Random) nature of an insurance contract?

Exchange of unequal values

What phase begins after a new policy is delivered?

Free-look period

Under the Privacy Rule for HIPAA, protected information includes all individually identifiable health information

Held or transmitted in any form

Untrue statements on the application unintentionally made by the insureds that, if discovered, would alter the underwriting decision of the insurance company, are called?

Material misrepresentations.

What is MIB?

Medical Information Bureau

Describes a unique characteristic of investigative consumer reports?

The customer's associates, friends, and neighbors provide the report's data

When should an agent obtain a Statement of Good Health from the insured?

When the premium is paid at the time of the policy delivery instead of at the time of the application

Within how many days of requesting an investigative consumer report must an insurer notify the consumer in writing that the report will obtain?

3 days

Which of the following entities can legally bind coverage?

Insurer

Insurance policies are not drawn up through negotiations, and an insured has little to say about its provisions. What contract characteristic does this describe?

Adhesion

What information are the members of the Medical Information Bureau required to report?

Adverse medical information about the applicant's or the insured

Whose responsibility is it to inform an applicant for health insurance about the insurer's information gathering practices?

The agent

The federal fair credit reporting act

regulates consumer reports

If an insurer decides to obtain medical information from different sources in order to determine the insurability of an applicant, who must be notified of the investigation?

the applicant

An agent makes a mistake on the application and then corrects his mistake by physically entering the necessary information. Who must then initial that change?

Applicant

What is the term used for a written request for an insurer to issue an insurance contract based on the provided information?

Application

In a replacement situation, what should not be considered?

Assets

What document describes an insured's medical history, including diagnoses and treatments?

Attending physician's statement

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.

Before an agent delivers a policy, the insurer makes a last-minute change to the policy. The agent informs the insured of this change, and he accepts it. In response, the agent must do what?

Have the insured sign a statement acknowledging that he is aware of the change.

When would a misrepresentation on the insurance application be considered fraud?

If it's intentional and material

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. What has the insurer done by this point?

Neither approved the application nor issues the policy

An agent is in the process of replacing the insured's current health insurance policy with a new one. Which of the following would be a proper action?

The old policy should stay in force until the new policy is issued

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

What is guaranteed to be true, and if untrue, may breech an insurance contract?

Warranty

What is the best way to make a change on an application for insurance?

You can either send it back out to the applicant and have them initial next to the corrects OR you can create a whole new application which is the easiest option

What describes a competent party?

Must be of legal age , must be mentally competent , and must not be under the influence of drugs or alcohol