CH 7. LIFE INSURANCE UNDERWRITING AND POLICY ISSUE QUESTIONS WITH CORRECT ANSWERS|100% verified|9 pages

CH 7. LIFE INSURANCE UNDERWRITING AND POLICY ISSUE QUESTIONS WITH CORRECT ANSWERS An insurance policy may be issued with a preferred insurance premium in all of these situations EXCEPT CORRECT ANSWER living in a rural area Where an applicant lives is not a factor in determining preferred rates. Field underwriting by a producer CORRECT ANSWER may result in the disclosure of hazardous activities of the applicant. Field underwriting is done when the producer is in front of the applicant. Very important due to the risk of a moral hazard. It is the initial step of the total process of insuring a health risk. 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? CORRECT ANSWER Good health statement At policy delivery, a good health statement may need to be signed by the insured to ensure there has NOT been any adverse medical conditions since the time of application. When a producer submits an application that discloses personal information regarding the applicant, who supplies the privacy notice? CORRECT ANSWER The producer The producer is responsible for providing the insurance applicant with privacy notices. The initial premium for a life insurance policy is typically paid in what way? CORRECT ANSWER It is typically obtained by the producer and forwarded to the insurer After an insurance application has been originated, the producer normally CORRECT ANSWER is the major personal contact to the insured The producer originating an insurance application usually is the major personal contact with the insured. A policy owner 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? CORRECT ANSWER Beneficiary receives $50,000 income tax-free 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,