Missouri Life and Health Insurance 2025-
2026 Question and Correct answer
GRADED A+
Insurance transaction includes: - ANSWERSBy mail or other means:
- Solicitation
- Negotiation
- Sale
- Advising an individual about coverage
Elements of a legal contract - ANSWERS-Agreement (offer and acceptance)
- Consideration
- Competent parties
- Legal purpose
- Negotiation does NOT need to happen
Who make the offer in an insurance application - ANSWERS- Applicant
When does acceptance take place - ANSWERS- An insurers underwriter approves the application and
issues a policy
The binding force in any contract - ANSWERS- Consideration
- insurer promises to pay in the event of a loss
,Contract of adhesion - ANSWERS- Prepared by the insurer and accepted or rejected by the insured
- "Take it or leave it" basis
Insurance contracts are - ANSWERS- Aleatory
- exchange of unequal amounts of values
Unilateral contract - ANSWERS- only one of the parties is legally bound
- "one-way contract"
"When does an insurance policy go into effect" - ANSWERS- When the insured receives it
Conditional contract - ANSWERS- certain conditions must be met by the policy owner
Warranty - ANSWERS- An absolutely true statement upon upon which the validity of the insurance
policy depends
Representions - ANSWERS- Statements believed to be true
Misrepresentation - ANSWERS- Untrue statements on the applications
- Can void the contract
Material misrepresentation - ANSWERS- Would alter the underwriting decision of insurance company
Part 1- General Information - ANSWERS- Name, age, address, birth date, gender, income, marital status,
and occupation
Part 2- Medical Information - ANSWERS- Medical background, present health
- Medical visits in recent years
- Medical status of relatives/ causes of deaths
,Field underwriter - ANSWERS- Solicited the potential insured
- Analyzes health
- Gets info on client
Agents report - ANSWERS- Observations concerning the proposed insured
- Does not become a part of the entire contract
- communicate with underwriter and provide info about the applicant known by the agent
Required signatures - ANSWERS- the proposed insured
- the agent
- the policy owner (if not proposed insured)
Changes in the application - ANSWERS- Applicant must initial the change
Consequences of incomplete applications - ANSWERS- Must return to applicant for completion
- If a policy is issued with questions left unanswered, the contract will be interpreted as if the insurer
waived its right to have an answer to the question
Premium receipt - ANSWERS- Agent must issue
- Will determine when coverage will be effective
Conditional receipt - ANSWERS- effective either on the date of application or medical exam
- Most common type of receipt
- used when applicant submits prepaid application
Replacement - ANSWERS- Terminating an existing policy or letting it lapse and obtaining a new one
- Nothing illegal about replacing life insurance
, Underwriting - ANSWERS- The risk selection process
- Avoid adverse selection
Adverse selection - ANSWERS- Risks which are more likely to suffer a loss
- Protects the insurer
Insurable interest - ANSWERS- Must exist between policy owner and insured at time of application
- Cannot buy on anyone
- Suffer financially if someone dies
Application - ANSWERS- Submit an application to the insurer for approval for a policy to be issued
Fair Credit Reporting Act - ANSWERS- Consumer-reporting agencies must follow in order to ensure that
records are properly used
- Protects consumers
- Insurance rated by states
- "At the time of application"
- If willingly violates Act penalty up to $2,500
Consumer report - ANSWERS- Written and/or oral information regarding a consumers credit, character,
habits collected by a reporting agency from employment records, credit reports, and other public
sources
Investigative consumer reports - ANSWERS- Visit with neighbors/employers
- insured or reporting agency has 5 days to provider the consumer with additional informtion
Medical Information Bureau (MIB) - ANSWERS- Insurance company looks at
- Nonprofit trade organization which received medical info from insurance companies and maintains
confidential medical information
- "Rated or declined"
2026 Question and Correct answer
GRADED A+
Insurance transaction includes: - ANSWERSBy mail or other means:
- Solicitation
- Negotiation
- Sale
- Advising an individual about coverage
Elements of a legal contract - ANSWERS-Agreement (offer and acceptance)
- Consideration
- Competent parties
- Legal purpose
- Negotiation does NOT need to happen
Who make the offer in an insurance application - ANSWERS- Applicant
When does acceptance take place - ANSWERS- An insurers underwriter approves the application and
issues a policy
The binding force in any contract - ANSWERS- Consideration
- insurer promises to pay in the event of a loss
,Contract of adhesion - ANSWERS- Prepared by the insurer and accepted or rejected by the insured
- "Take it or leave it" basis
Insurance contracts are - ANSWERS- Aleatory
- exchange of unequal amounts of values
Unilateral contract - ANSWERS- only one of the parties is legally bound
- "one-way contract"
"When does an insurance policy go into effect" - ANSWERS- When the insured receives it
Conditional contract - ANSWERS- certain conditions must be met by the policy owner
Warranty - ANSWERS- An absolutely true statement upon upon which the validity of the insurance
policy depends
Representions - ANSWERS- Statements believed to be true
Misrepresentation - ANSWERS- Untrue statements on the applications
- Can void the contract
Material misrepresentation - ANSWERS- Would alter the underwriting decision of insurance company
Part 1- General Information - ANSWERS- Name, age, address, birth date, gender, income, marital status,
and occupation
Part 2- Medical Information - ANSWERS- Medical background, present health
- Medical visits in recent years
- Medical status of relatives/ causes of deaths
,Field underwriter - ANSWERS- Solicited the potential insured
- Analyzes health
- Gets info on client
Agents report - ANSWERS- Observations concerning the proposed insured
- Does not become a part of the entire contract
- communicate with underwriter and provide info about the applicant known by the agent
Required signatures - ANSWERS- the proposed insured
- the agent
- the policy owner (if not proposed insured)
Changes in the application - ANSWERS- Applicant must initial the change
Consequences of incomplete applications - ANSWERS- Must return to applicant for completion
- If a policy is issued with questions left unanswered, the contract will be interpreted as if the insurer
waived its right to have an answer to the question
Premium receipt - ANSWERS- Agent must issue
- Will determine when coverage will be effective
Conditional receipt - ANSWERS- effective either on the date of application or medical exam
- Most common type of receipt
- used when applicant submits prepaid application
Replacement - ANSWERS- Terminating an existing policy or letting it lapse and obtaining a new one
- Nothing illegal about replacing life insurance
, Underwriting - ANSWERS- The risk selection process
- Avoid adverse selection
Adverse selection - ANSWERS- Risks which are more likely to suffer a loss
- Protects the insurer
Insurable interest - ANSWERS- Must exist between policy owner and insured at time of application
- Cannot buy on anyone
- Suffer financially if someone dies
Application - ANSWERS- Submit an application to the insurer for approval for a policy to be issued
Fair Credit Reporting Act - ANSWERS- Consumer-reporting agencies must follow in order to ensure that
records are properly used
- Protects consumers
- Insurance rated by states
- "At the time of application"
- If willingly violates Act penalty up to $2,500
Consumer report - ANSWERS- Written and/or oral information regarding a consumers credit, character,
habits collected by a reporting agency from employment records, credit reports, and other public
sources
Investigative consumer reports - ANSWERS- Visit with neighbors/employers
- insured or reporting agency has 5 days to provider the consumer with additional informtion
Medical Information Bureau (MIB) - ANSWERS- Insurance company looks at
- Nonprofit trade organization which received medical info from insurance companies and maintains
confidential medical information
- "Rated or declined"
