Chapter 5: Life Underwriting

when a policyowner cash surrenders a universal life insurance policy in its early years this may be considered a red flag for a

anti-money laundering

An applicant's medical information received from the Medical Information Bureau (MIB) may be furnished to the

applicant's physician

what is the initial source of underwriting for an insurance policy?

application containing statements from the insured

a ___ contained in life insurance policy states that the policy will NOT cover certain risks

exclusion

An underwriter determines that an applicant's risk should be recategorized due to a health issue. This policy may be issued with a(n)

exclusion for the medical condition

M completes an application for life insurance but does not pay the initial premium. All of these actions must occur before M's policy goes into effect EXCEPT

free-look period has expired

information obtained from a phone conversation to the proposed insured can be found in which report?

inspection report

Which of these factors do NOT play a role in the underwriting of a life insurance policy?

martial status

A Medical Information Report (MIB) report may disclose which of the following

prior use of marjiuanna

which factors are taken into consideration when an insurance company determines the premium rate for a whole life policy on an applicant?

risk classification

the reason for backdating a policy is

to obtain a premium rate based on an earlier age

Which parts of a life insurance policy are guaranteed to be true?

warranty

under the usa patriot act insurers are required to report receipt of cash payments in excess of

$10,000

On August 6, D submitted an application for a $50,000 Life Insurance policy and did not pay the initial premium. On August 18, D went to his doctor complaining of chest pains and some tests were given by the doctor. The life policy was delivered by the producer on August 20 and D explains what had recently taken place with the doctor. What action should the producer then take?

Collect initial premium along with a signed health statement

From what authority derives the requirement that an insurance application contains a disclosure stating that an investigative consumer report may be obtained on an applicant?

Fair Credit Reporting Act

What action should a producer take if the initial premium is NOT submitted with the application?

Forward the application to the insurer without the initial premium

Which of these do NOT constitute policy delivery?

Policy issued with a rating

Q applied for life insurance and submitted the initial premium on January 1. The policy was issued February 1, but it was not delivered by the agent until February 7. Q is dissatisfied and returns the policy February 13. How will the insurer handle this situation?

Policy was returned within the free-look period, premium will be fully refunded

Which of these terms accurately defines an underwriter's assessment of information on a life insurance application?

Risk classification

Why is an applicant's signature required on a life insurance application?

To attest that the statements on the application are accurate to the best of the applicant's knowledge