7 - Health Insurance Underwriting (Test only has 5 Questions)

Which of the following actions will an insurance company most likely NOT take if an applicant, who has diabetes, applies for a Disability Income policy?

Issue the policy with an altered Time of Payment of Claims provision ( "Issue the policy with an altered Time of Payment of Claims provision". The insurance company may take all of these actions EXCEPT issue the policy with an altered Time of Payment of Claims provision.

Which of the following are NOT managed care organizations?

Medical Information Bureau (MIB) (Correct.) All of the following entities are managed care organizations EXCEPT MIB (Medical Information Bureau).

Which mode of payment is NOT used by health insurance policies?

Single premium (Correct.) Single premium is not used when paying for health insurance policies.

Which of the following statements about the classification of applicants is INCORRECT?

Substandard applicants are never declined by underwriters (Correct.) A substandard risk is below the insurer's average risk guidelines. An individual can be rated substandard for a number of reasons and can even be rejected outright.

A producer takes an individual Disability Income application, collects the appropriate premium, and issues the prospective insured a conditional receipt. The next step the insurance company will take is to

determine if the applicant is an acceptable risk by completing standard underwriting procedures (Correct.) With a conditional receipt, the insurance company will complete standard underwriting procedures before making a decision about whether to insure the applicant.