Underwriting and Policy Issue Cram Exam

What is being delivered during a policy delivery?

Insurance contract to the proposed insured

An incomplete life insurance application submitted to an insurer will result in which of these actions?

Application will be returned to the writing agent

In order for coverage on a non-medical insurance application to take effect the same day, the producer must collect a signed application and what?

the initial premium

Information obtained from a phone conversation to the proposed insured can be found in which of these reports?

Inspection report

When does a life insurance contract become effective if the initial premium is not collected during the application process?

When producer delivers policy and collects initial premium

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, w

The date the agent delivered the policy, collected the initial premium, and obtained a good health statement from the insured

An insurance company may NOT reject a prospective insured's life application on the basis of which of the following factors?

Gender

Agent J takes an application and initial premium from an applicant and sends the application and premium check to the insurance company. The insurance company returns the check back to J because the check is made out to J instead of the insurance company.

Return to the customer, collect a new check made out to the insurance company, and send the new check out to the insurance company

Which of these do NOT constitute policy delivery?

Policy issued with a rating

T applies for a life insurance policy and is told by the producer that the insurer is bound to the coverage as of the date of the application or medical examination, whichever is later. Assuming that T is an acceptable risk, what item is given to T?

Conditional receipt

Which of the following correctly explains the actions an agent should take if a customer wants to apply for an insurance policy?

Complete the application and review the information with the customer prior to obtaining the customer's signature, then send the application off to the insurance company

At what time must a policyowner have insurable interest on the insured in order for the life policy to be valid?

At the time of application

K applies for a life insurance policy on herself and submits the initial premium with the application. She is given a receipt by the agent stating that coverage begins immediately if the application is approved. What kind of receipt was used?

Conditional

The USA Patriot Act was enacted in?

2001

P completes an application for a $10,000 life policy, but does not give the producer the initial premium. P's coverage becomes effective when?

P receives the policy and pays the premium

Agent J takes an application and initial premium from an applicant and sends the application and premium check to the insurance company. The insurance company returns the check back to J because the check is made out to J instead of the insurance company.

Return to the customer, collect a new check made out to the insurance company, and send the new check out to the insurance company

Q applied for life insurance and submitted the initial premium on January 1. The policy was issued February 1, but it was not delivered by the agent until February 7. Q is dissatisfied and returns the policy February 13. How will the insurer handle this s

Policy was returned within the free-look period, premium will be fully refunded

Which of these terms accurately defines an underwriter's assessment of information on a life insurance application?

Risk classification

Which factors are taken into consideration when an insurance company determines the premium rate for a Whole Life policy on an applicant?

Risk classification

Which of the following correctly explains the actions an agent should take if a customer wants to apply for an insurance policy

Complete the application and review the information with the customer prior to obtaining the customer's signature, then send the application off to the insurance company

An applicant's medical information received from the Medical Information Bureau (MIB) may be furnished to the?

applicant's physician

Which parts of a life insurance policy are guaranteed to be true?

Warranty

The underwriting process involves all of these EXCEPT for?

Policy loan

From what authority derives the requirement that an insurance application contains a disclosure stating that an investigative consumer report may be obtained on an applicant?

Fair Credit Reporting Act

An underwriter determines that an applicant's risk should be recategorized due to a health issue. This policy may be issued with a(n)?

exclusion for the medical condition

Which of these factors do NOT play a role in the underwriting of a life insurance policy?

Marital Status

Any changes made on an insurance application requires the initials of whom?

Applicant

Upon delivery of a rated life insurance policy, the Producer must obtain each of the following EXCEPT?

Signed HIPAA disclosure

Why is an applicant's signature required on a life insurance application?

To attest that the statements on the application are accurate to the best of the applicant's knowledge

On January 8, an applicant filled out an application for a life insurance policy but did not include the initial premium. The insurance company approved the application on January 14 and issued the policy January 15. The producer delivered the policy on J

January 26

A life insurance application must be signed by all of these EXCEPT?

beneficiary

On August 6, D submitted an application for a $50,000 Life Insurance policy and did not pay the initial premium. On August 18, D went to his doctor complaining of chest pains and some tests were given by the doctor. The life policy was delivered by the pr

Collect initial premium along with a signed health statement

When a policyowner cash surrenders a Universal Life insurance policy in it's early years, this may be considered a red flag for a(n)?

Anti-Money Laundering violation

Consumer reports requested by an underwriter during the application process of a life insurance policy can be used to determine?

probability of making timely premium payments

On delivery of a policy, a signed statement of good health is typically requested if?

The application was submitted without the initial premium

Which Federal law allows an insurer to obtain an inspection report on a potential insured?

Fair Credit Reporting Act

Who is NOT required to sign a life insurance application?

Beneficiary

What is the purpose of the U.S.A. Patriot Act?

detect and deter terrorism

ABC Insurance Company has accepted a life insurance application which contains unanswered questions. The company then makes the application part of the life contract. In this situation, the insurer has

waived one of its legal rights

M completes an application for life insurance but does not pay the initial premium. All of these actions must occur before M's policy goes into effect EXCEPT

...