LIFE & HEALTH INSURANCE

What is the maximum penalty for habitual willful noncompliance with the Fair Credit Reporting Act?

$2,500

Pay the policy proceeds only if it would have issued the policy.

A prospective insured receives a conditional receipt but dies before the policy is issued. The insurer will...

The date of medical exam

An individual applied for an insurance policy and paid the initial premium. The insurer issued a conditional receipt. Five days later the applicant had to submit to a medical exam. If the policy is issued, what would be the policy's effective date?

Conditions

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...

With the policy

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

The policy will be interpreted as if the insurer waived its right to have an answer on the application

If an insurer issued a policy based on the application that had unanswered question, which of the following will be TRUE?

Applicant's past income

In classifying a risk, the Home Office underwriting department will look at all of the following EXCEPT

An applicant submits an application to the insurer

In insurance, an offer is usually made when

Adhesion

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

"Not taxable" since the IRS treats them as a return of a portion of the premium paid.

On a participating insurance policy issued by a mutual insurance company, dividends paid to policy holders are...

Other insurance coverages

Part 2 of the application for life insurance provides questions regarding all of the following EXCEPT

Considered to be true to the best of the applicant's knowledge

Representations are written or oral statements made by the applicant that are...

Erase the incorrect answer and record the correct answer

Something an agent should NOT do if a change on the application needs to be made

Which of the following is NOT the consideration in a policy?

The application given to a prospective insured

A presentation of non-guaranteed elements of a policy

The term "illustration" in a life insurance policy refers to

Signed waiver of premium

Upon policy delivery, the producer may be required to obtain any of the following EXCEPT

One-sided: only one party makes an enforceable promise

What is a definition of a unilateral contract?

To allow the consumer to compare the costs of different policies

What is the purpose of the buyer's guide

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 the coverage begin?

When the agent delivers the policy, collects the initial premium, and the applicant completes an acceptable Statement of Good Health

When is the earliest a policy may go into effect?

When the application is signed and a check is given to the agent

If it is intentional and material

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

Their premiums are lower

Which is generally true regarding insureds who have been classified as preferred risks?

Standard

Which of the following is a risk classification used by underwriters for life insurance?

Premium amounts and surrender values

Which of the following will be included in a policy summary?

Medical Information

Which part of an insurance application would contain information regarding the cause of death of the applicant's deceased relatives?

The producer

Whose responsibility is it to make certain that an application for insurance is filled out completely and correctly?

To help the insured understand all aspects of the contract

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

Policy summary

describes the features and elements of the specific policy for which a person is applying

Exchange of unequal values

the aleatory nature of an insurance contract

What is NOT true concerning insurable interest as it applies to life insurance?

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

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

In comparison to consumer reports, which of the following describes a unique characteristic of investigative consumer reports?

Return the application to the applicant for completion

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

Selection, classification, and rating of risks

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