Completing the Application, Underwriting, Delivering Policies, Contract Law
An applicant asks whether every answer on a life application is an absolute guarantee of literal accuracy. Which response is correct?
Answer and explanation
Answer: B. Life policy standards provide that, in the absence of fraud, statements made by an applicant for issuance, reinstatement, or renewal are representations and not warranties. They still matter to underwriting and contestability.Source: Interstate Insurance Product Regulation Commission — Individual Term Life Insurance Policy Standards — § 3.I. Entire Contract (2)
More completing the application, underwriting, delivering policies, contract law questions
- What is the producer's ethical responsibility when delivering a rated (substandard) policy to a client?
- What non-profit central information bureau, supported by insurance companies, collects and shares coded medical background data with member insurers during underwriting?
- What right does the GLBA opt-out notice provide to policyowners regarding nonpublic personal financial information?
- When a corporation is the proposed policyowner, what should identify the person signing for it?
- When a policyowner stops paying premiums, allowing a term life policy to lapse, the insurer cannot take legal action to force the owner to continue making payments. Which characteristic of insurance contracts does this limitation reflect?
- When an applicant submits a completed application WITH initial premium, what legal act does the applicant perform in contract law?
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