Life Insurance Basics
How must a producer handle a premium collected from an applicant?
Answer and explanation
Answer: C. Premiums are fiduciary funds, so they are receipted and forwarded without delay and kept apart from the producer's own money. Holding, mingling or offsetting the money against other balances would be a breach of that duty.Source: PSI — New York DFS Insurance Candidate Information Bulletin — Outline, premium collection
More life insurance basics questions
- Which of these is a cash need rather than a continuing income need in a personal needs analysis?
- Which of these is a lump-sum need in a life insurance analysis?
- Which term does New York's illustration rule prohibit in describing the application of nonguaranteed elements?
- Which three factors determine a life insurance premium?
- Which three factors determine the premium an insurer charges for a life policy?
- Who bears the investment risk in a variable life policy?
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