Chapter 7: Life Insurance Underwriting and Policy Issue
It is typically obtained by the producer and forwarded to the insurer
The initial premium for a life insurance policy is typically paid in what way?
Beneficiary receives $50,000 income tax-free
A policyowner pays the first annual premium for a $50,000 life insurance policy and dies one month after the policy effective date. Which of these statements is normally true?
Insurance companies
The Medical Information Bureau consists of members from which group?
completed application
The principal source of information concerning an applicant's identity, age, and marital status is found in the
to obtain a premium rate based on an earlier age
The reason for backdating a policy is
Producer
When a producer submits an application that discloses personal information regarding the applicant, who supplies the privacy notice?
When the initial premium has been collected with the application
When does the producer give a premium receipt for a life insurance application?
Prior to or at the time of signing the application
When must a producer provide disclosure about information practices to an applicant?
premium charges
Where is the difference between a standard risk and a substandard risk reflected?
living in a rural area
An insurance policy may be issued with a preferred insurance premium in all of these situations EXCEPT
unlimited
Insurable interest in one's own life generally is regarded as
Date of issuance of the conditional receipt
Mike applied for life insurance and was issued a conditional receipt. He is later found to be insurable and is issued a policy. When does his coverage become effective?
Give notice, explain, and allow opting out
When the disclosure of an insured's nonpublic information is involved, what is the insurer obligated to do?
National origin
Which of these is NOT used as selection criteria in the underwriting process of a life insurance application?
Consumer report
Which report contains information regarding an individual's general reputation and credit standing?
policy delivery
A signed good health statement may be requested by a life producer at the time of
a false statement could lead to loss of coverage
After an applicant reads and signs an insurance application, he/she should be conscious of the fact that
is the major personal contact to the insured
After an insurance application has been originated, the producer normally
Leave a conditional receipt with client
All of these are duties that a producer may be required to perform when delivering an insurance policy EXCEPT
When the conditions of the receipt are met
An agent gives a conditional receipt to a client for an insurance policy after collecting the initial premium. When will the policy become effective?
Applicant has a right to receive a copy of the report
An applicant submits a life insurance application where an investigative consumer report is used in the underwriting process. Which of these statements is true?
Good health statement
An insured may be required to sign which document at policy delivery to ensure there has not been any adverse medical conditions since the time of the application?
the date the agent delivered the policy, collected the initial premium, and obtained a good health statement from the insured
K is an agent who takes an application for individual life insurance and accepts a check from the client. He submits the application and check to the insurance company, however the check was never signed by the applicant. If the application is approved, when will coverage be effective?
Eye examination
When an applicant applies for a large amount of life insurance coverage, which of the following would likely NOT be an underwriting requirement?
Determining the final rate classification
Which of these is NOT an underwriting responsibility of a life insurance agent?
Selecting the final approval date
Which of these is NOT considered the responsibility of a producer in the underwriting process?
Applicant is a substandard risk
In what situation could an insurance policy's coverage be modified?
Conditional receipt
What must be given to a life insurance applicant when the agent receives an application and the initial premium?
may result in the disclosure of hazardous activities of the applicant
Field underwriting by a producer