Xcel ch.6. Life Insurance underwriting
- Agent Reports (Statement)- Agents personal observation of the applicant
-Includes the applicants financial condition, character, background , purpose of sale, and how
long the agent has known the applicant
-Often called the Agent's report. This is where the agent reports personal observations about
the proposed insured
-Because the agent represents the interest of the insurance company , the agent is expected to
complete this part of the application fully and truthfully - ANS-Part III of the Application
- If an agent realizes that a applicant as made an error on an application, the agent must correct
the information and have the applicant initial the changes
-An incomplete application will be returned to the agent
- The agent can NEVER change the application without the customer present to initial the
changes - ANS-Application Errors
-general information- Age, DOB, Sex, Address, Marital status, Occupation
-Details about the request insurance coverage:
type of policy
amount of insurance
name and relationship of the beneficiary
-Other information personal information
tabacco use
hazardous hobby
foreign travel
aviation activity
military service - ANS-Part 1 of application: general information
-Happens when the insurer "approves" the application, they are "issuing the policy"
-Technically a policy could be ISSUED and not delivered for days or weeks later - ANS-Policy
Issues
, (temporary insurance agreement) provides coverage for the date of the application regardless of
whether the applicant is insurable. Coverage usually lasts for 30 to 60 days, or until the insurer
accepts pr declines the coverage.
Rarely used in life insurance but are primarily used in homeowners insurance - ANS-Binding
Receipt
1.The application
2.The medical report
3.Attending physician's statement
4.The Medical Information Bureau
5.Special Questionnaires
6.Inspection Reports
7.Credit Reports - ANS-Most common sources of underwriting information include:
A good health statement - ANS-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 high risk; requires special conditions to be included in the policy or issued a rated policy
High Risk - Rated Up - Higher Premiums chronic conditions, insulin diabetes, heart disease -
ANS-Substandard Risk
A nonprofit trade organization which maintains medical information about individuals.
Information from this is used by life and health insurers, this helps insurance companies from
adverse selection by applicants
Detects misrepresentation, helps identify fraudulent information, and controls the cost of
insurance
Information received and released will be to the proposed insured's physical
Insurance Company would NOT notify the MIB if an application is declined - ANS-Medical
Information Bureau (MIB)
According to HIPPA, provides federal protection for an individuals health information and gives
patients an array of rights with respect to individually identifiable health information, the an
agent submits an application that reveals personal information regarding the applicant, the
agent is responsible for providing the insurance applicant with privacy notice.
Producer must also secure an HIV consent form form the applicant in applicable situations and
communicate blood tests may be required with the the underwriting practice. - ANS-Privacy
Notice
- Agent Reports (Statement)- Agents personal observation of the applicant
-Includes the applicants financial condition, character, background , purpose of sale, and how
long the agent has known the applicant
-Often called the Agent's report. This is where the agent reports personal observations about
the proposed insured
-Because the agent represents the interest of the insurance company , the agent is expected to
complete this part of the application fully and truthfully - ANS-Part III of the Application
- If an agent realizes that a applicant as made an error on an application, the agent must correct
the information and have the applicant initial the changes
-An incomplete application will be returned to the agent
- The agent can NEVER change the application without the customer present to initial the
changes - ANS-Application Errors
-general information- Age, DOB, Sex, Address, Marital status, Occupation
-Details about the request insurance coverage:
type of policy
amount of insurance
name and relationship of the beneficiary
-Other information personal information
tabacco use
hazardous hobby
foreign travel
aviation activity
military service - ANS-Part 1 of application: general information
-Happens when the insurer "approves" the application, they are "issuing the policy"
-Technically a policy could be ISSUED and not delivered for days or weeks later - ANS-Policy
Issues
, (temporary insurance agreement) provides coverage for the date of the application regardless of
whether the applicant is insurable. Coverage usually lasts for 30 to 60 days, or until the insurer
accepts pr declines the coverage.
Rarely used in life insurance but are primarily used in homeowners insurance - ANS-Binding
Receipt
1.The application
2.The medical report
3.Attending physician's statement
4.The Medical Information Bureau
5.Special Questionnaires
6.Inspection Reports
7.Credit Reports - ANS-Most common sources of underwriting information include:
A good health statement - ANS-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 high risk; requires special conditions to be included in the policy or issued a rated policy
High Risk - Rated Up - Higher Premiums chronic conditions, insulin diabetes, heart disease -
ANS-Substandard Risk
A nonprofit trade organization which maintains medical information about individuals.
Information from this is used by life and health insurers, this helps insurance companies from
adverse selection by applicants
Detects misrepresentation, helps identify fraudulent information, and controls the cost of
insurance
Information received and released will be to the proposed insured's physical
Insurance Company would NOT notify the MIB if an application is declined - ANS-Medical
Information Bureau (MIB)
According to HIPPA, provides federal protection for an individuals health information and gives
patients an array of rights with respect to individually identifiable health information, the an
agent submits an application that reveals personal information regarding the applicant, the
agent is responsible for providing the insurance applicant with privacy notice.
Producer must also secure an HIV consent form form the applicant in applicable situations and
communicate blood tests may be required with the the underwriting practice. - ANS-Privacy
Notice
