Florida Agent's Health Insurance: Field Underwriting Procedures 11%

Medical Information Options:

1. A Paramedical Report - completed by a paramedic or registered nurse. 2. Attending Physicians Statement - medical practitioner who treated the applicant for a prior medical condition or problem. 3. Medical Information Bureau Report

Underwriting Factors of Consideration:

1. Age 2. Sex 3. Medical History 4. Avocations - hobbies

Legal Purpose

A legal contract must not go against public policy. An Insurance Contract must have BOTH: 1. Insurable Interest 2. Consent

Medical Information Bureau

A non-profit organization owned by member insurance companies. They maintain confidential medical information. The MIB can only be used as an aid for investigation. Applicants cannot be refused based on info gathered from theses sources.

Policy Delivery

Agent has the responsibility to deliver the policy to the insured and to collect any premium that may be due at time of delivery.

No Initial Premium with Application

Agent must collect the premium and obtain a STATEMENT OF CONTINUED GOOD HEALTH from the applicant before releasing the policy.

Attending Physicians Report

And APS (attending physicians Statement) would be sent to the applicant's primary physician to be completed. The Physician could explain: Attending Physicians Statement 1. Applicant was treated for 2. Treatment required 3. Length of treatment 4. Recovery 5. Prognosis

Medical Exam Report

Conducted by a physicians at the insurer's expense. Not Required.

Elements of a Contract

Each Insurance Contract must have: 1. Agreement 2. Consideration 3. Competent Parties 4. Legal Purpose

Medical Information

For policy's with high amounts of coverage or the application raised additional questions, a medical examiners report may be required or requested.

Investigative Consumer Reports

Information gathered through investigation and interviews with friends, associates, and neighbors of the the consumer. *Consumer must be notified in writing 3 days before report is requested. And be offered a copy of the information discovered.*

Material Misrepresentations

Information that would alter the underwriting decision of the insurance company.

Insurable Interest

Insurable interest is proven by LOVE AND AFFECTION, ECONOMIC LOSS OR FINANCIAL GAIN.

Aleatory Contract

Mean there is an exchange of unequal amounts or values. the premium paid by the insured is small in relation to the amount paid in the event of loss.

Necessary Parties Required to Sign Application

Necessary Parties Required to Sign Application Are: • The Agent • The Applicant • The proposed insurer (if different than applicant)

Fair Credit Reporting Act

Procedures that ensure that records area confidential, accurate, relevant, and properly used. This Law protects consumers from inaccurate info.

Conditional Contract

Requires that certain conditions must be met by the policy owner and the company in order for the contract to be executed, BEFORE each party fulfills its obligations.

Representations

Statements believed to be true to the best of one' s knowledge.

Agreement: Acceptance

Takes place when an insurer's underwriter approves the application and issues an insurance certificate/policy.

Explaining Policy, Provisions, Riders, Exclusions and Ratings

The Agent's responsibility to provide the insured an explanation of the policy's principal benefits, and provisions. If there are any changes, amendments or riders the agent must explain and obtain signatures acknowledging receipt of these amendments.

Agreement: Offer

The applicant makes the offer when submitting an application.

Sources of Insurability Information:

To determine the insurability of the applicant, insurers may use several sources to gather information to base their decision. The APPLICANT MUST BE ADVISED OF THE SOURCES TO BE USED AND HOW INFORMATION IS GATHERED. All sources used to verify applicant must adhere to the Fair Credit Reporting Act.

Misrepresentations

Untrue statements on the application. (Could void the contract)

Fraud

When material misrepresentations discovered were made intentionally.

Unilateral Contract

Where only one party is legally bound to do anything.

Consumer Reports

Written or oral information gathered regarding the consumers credit, character, reputation, or habits collected by a reporting agency.

Initial Premium Payment and Reciept

initial premium is collected for health insurance policies and sent with the application to the insurer. A Conditional Receipt is given to the applicant from the agent. *AGENTS CANNOT BIND COVERAGE) Coverage begins when insurer approves application and issues a policy.

Completion of Application

An accurate and thorough application is required and critical for proper underwriting. Applications are filled out by the AGENT and a Medical Examiner - if deemed necessary.

Adhesion

A Contract of Adhesion is prepared by one of the parties (insurer) and accepted or rejected by the other (the Insured/applicant)

Replacement

An Gent attempting to replace an existing policy with a new one must check, and verify the benefits, limitations, exclusions compare or are better and NOT TO THE DETRIMENT OF THE APPLICANT. Agent must also make sure the current policy is not canceled before the new one is issued.

Warranty

An absolutely true statement. The validity of the insurance policy depends upon it being present.

Contract Law

Each insurance contract must have 4 essential elements to be legally binding.

Consideration

Each party in the contact get something of value in return.

Competent Parties

Each person in the contact must be deemed competent in the eyes of the law. Competent Parties are: • Of Legal Age • Mentally competent • Understand the contract • No under the influence of drugs or alcohol