XCEL Chapter 7 Test Questions with Correct Answers

XCEL Chapter 7 Test Questions with Correct Answers When does a life insurance policy typically become effective? A. When the policy is issued B. When initial premium is collected and policy is issued C. When the application is completed and signed D. When the completed application is signed and initial premium is collected - Answer-When initial premium is collected and policy is issued What is the purpose of the Medical Information Bureau (MIB)? A. To accept or decline insurance applicants B. To set the premium rates for insurers C. To help underwriters evaluate risk D. To perform physical examinations on applicants - Answer-To help underwriters evaluate risk How many months can a life insurance policy normally be backdated from the date of application? A. 3 B. 6 C. 9 D. 12 - Answer-6 Upon policy delivery, which of the following must a producer have an applicant sign if no initial premium was collected with the life insurance application? A. A waiver of premium B. A replacement form C. A good health statement D. An exclusion - Answer-A replacement form What is involved when a life insurance policy has been backdated? A. Setting a policy's effective date prior to a preexisting condition B. Redating a policy after it has been issued C. Reinstating a lapsed policy D. Making the policy effective on an earlier date than the present - Answer-Making the policy effective on an earlier date than the present