Life Insurance Underwriting & Policy Issue

Question 1

Field underwriting performed by the producer involves

Answer 1

Completing application and collecting premium

Question 2

What guarantees that the statements supplied by an insurance applicant
are true?

Answer 2

Warranty

Question 3

Which of the following types of information is NOT required for a life
insurance application?

Answer 3

Ethnicity

Question 4

What happens when an insurance policy is backdated?

Answer 4

The policy effective date is earlier than the present

Question 5

What is the purpose of the Medical Information Bureau (MIB)?

Answer 5

To help on the underwriter evaluate risk

Question 6

Which of the following describes a person who is NOT acceptable by an
insurer at standard rates because of health history, occupation, or
hobbies?

Answer 6

Substandard

Question 7

The principle of insurable interest, in regards to a life insurance contract,
is accurately described in which statement?

Answer 7

Insurable Interest can be based on the love and affection of individuals related by blood or law 

Question 8

Which of the following is a requirement for ANY change in an insurance
application?

Answer 8

Change must be initialize by the applicant

Question 9

Which of the following signatures is not required on an individual
insurance application?

Answer 9

Insurer

Question 10

An insurance producer is often responsible for field underwriting durin
the application process. All of these are possible field underwriting role
EXCEPT

Answer 10

Providing commission information to the applicant

Question 11

An attending physician’s statement would be appropriate for which life
insurance purpose?

Answer 11

At the request of the insurer to assist in the underwriting decision

Question 12

Which of the following risk classifications charges the highest premium?

Answer 12

Substandard

Question 13

The risk selection process is primarily given to which insurance company
department?

Answer 13

Underwriting

Question 14

Which scenario would most life insurance policies exclude coverage for?

Answer 14

An individual who has a hobby racing cars once a month

Question 15

The Medical Information Bureau consists of

Answer 15

Life and health insurance companies

Question 16

Underwriters can acquire information from all of the following sources
EXCEPT

Answer 16

Genetic testing

Question 17

An applicant’s character and personal habits can be obtained for
underwriting purposes from which source?

Answer 17

Investigative consumer report

Question 18

How does a conditional receipt differ from a binding receipt?

Answer 18

Binding receipts always provide insurance which stars from the date of receipt

Question 19

Which of the following does a life insurance policy summary normally
include?

Answer 19

The policy cash value

Question 20

An insurer has a right to screen applicants for HIV in which of the
following ways?

Answer 20

Blood test for HIV

Question 21

An insurance applicant with a below-average likelihood of loss is typically
considered to be a

Answer 21

Preferred risk

Question 22

All of these are typically sources of underwriting information for life
health insurance EXCEPT

Answer 22

Disclosure authorization response

Question 23

A field underwriter’s main task is

Answer 23

To ensure an applicant medical information is accurate and complete

Question 24

Signatures for an insurance application MUST be obtained by th
producer from all of the following sources EXCEPT

Answer 24

Beneficiary

Question 25

A person who is a nonsmoker, of average weight, and in excellent health would most likely be in which risk classification?

Answer 25

Preferred

Question 26

Most U.S. life insurance companies belong to the

Answer 26

Medical information bureau

Question 27

Which of the following is NOT an important reason for a life insurance application?

Answer 27

The beneficiary must sign the policy

Question 28

Preferred risk policies with reduced premiums are issued by insurance companies because the insured has

Answer 28

Better than average mortality & morbidity experience

Question 29

In which of the following relationships would there NOT be an insurable interest?

Answer 29

Business owner to business customer

Question 30

An individual most likely will have an insurable interest in insuring a person's life if

Answer 30

An economic interest exist for the continuance of the insured life

Question 31

A change in an insurance application requires

Answer 31

And initial made by the applicant

Question 32

Which of the following risk classifications charges the lowest premium?

Answer 32

Preferred

Question 33

Which of the following statements is CORRECT regarding an individual applying for life or health insurance?

Answer 33

The applicant medical history may be analyze and reported 

Question 34

How many months can a life insurance policy normally be backdated from the date of application?

Answer 34

6

Question 35

What must an applicant do in order to authorize the release of an attending physician report?

Answer 35

Sign a consent form

Question 36

All of these are considered sources of information that can assist an underwriter in determining whether or not to accept a risk EXCEPT

Answer 36

The national Association of insurance on the writers

Question 37

An applicant intentionally lying to an insurance company on an application in order to obtain a cheaper premium is an example

Answer 37

Fraud

Question 38

Statements made by an insurance applicant on an application are considered to be

Answer 38

Representation

Question 39

A report which is based on creditworthiness and personal characteristics that influences an insurance applicant's eligibility for life and health insurance is called a(n)

Answer 39

Consumer report

Question 40

All of these are considered key factors in underwriting life insurance except

Answer 40

Marital status

Question 41

In regards to a life insurance contract, which of the following statements is NOT true regarding the concept of insurable interest?

Answer 41

Insurable interest can be established sufficiently by sentimental attachment alone

Question 42

When an insurance company requests an attending physician's report, the request must be accompanied by a 

Answer 42

copy of the signed authorization

Question 43

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?

Answer 43

A good health statement

Question 44

Which of the following would be a valid reason why a policy premium would be higher than the standard premium?

Answer 44

The insured does not meet the establish on the writing requirements

Question 45

When does a life insurance policy typically become effective?

Answer 45

When the initial premium is collected and the policy is issued

Question 46

Which of these is likely to occur when life or health insurance is being applied for?

Answer 46

Medical history from the insured may be reviewed and reported 

Question 47

Which of the following pertains to the analysis of an applicant's personal information and determining whether insurance should be issued or declined?

Answer 47

Underwriting

Question 48

An underwriter's primary responsibility to an insurer is to protect against

Answer 48

Adverse selection

Question 49

Which of these is considered to be a document that describes the critical segments of a life insurance policy?

Answer 49

Policy summary

Question 50

Which of these is NOT considered to be a risk factor in life insurance underwriting?

Answer 50

Number of children 

Question 51

The object of underwriting is to

Answer 51

Avoid selecting disproportionate number of bad risk

Question 52

An applicant has revealed conditions that require more information. Which of the following is needed next?

Answer 52

Attending physician statement

Question 53

An insurance company needs to obtain personal information from a third party concerning an applicant. Which law do all insurers and their producers need to comply with?

Answer 53

Fair credit reporting act

Question 54

Which of the following is NOT a risk classification that an underwriter would use?

Answer 54

Dividend risk

Question 55

What are members of the Medical Information Bureau (MIB) required to report?

Answer 55

Medical ailments discovered during the writing process

Question 56

Which of the following would be considered an underwriting duty of an agent?

Answer 56

Completing all applications and collecting initial premiums

Question 57

What would happen if a life insurance applicant is given a conditional receipt from an insurance agent and then dies the next day?

Answer 57

Claim will be paid if application is approved

Question 58

What is involved when a life insurance policy has been backdated?

Answer 58

Making the policy effective on an earlier date than the present