Completing the Application, Underwriting, and Delivering the Policy
What must a life insurance application ask about existing coverage?
Answer and explanation
Answer: C. Section 3(I) of the uniform application standards requires the application to have the applicant specify if the insurance applied for is intended to replace or change any life insurance or annuity contract in force. Prior declines, guide receipt, and assignment intentions are not what this section requires.Source: Interstate Insurance Product Regulation Commission — Individual Life Insurance Application Standards — § 3(I), Replacement of insurance
More completing the application, underwriting, and delivering the policy questions
- A life insurance policyowner may stop paying premiums at any time without legal penalty, but the insurer is legally bound to pay the death benefit if the insured dies while the policy is in force. This situation best illustrates which legal characteristic of an insurance contract?
- A new owner finds part of the delivered policy unclear. What does consumer guidance direct?
- A parent applies for life insurance on a 9-year-old child. Who must sign the application besides the producer?
- A policy is arranged so an unrelated investor can profit from a stranger's death. Which element of contract formation fails?
- A policy is delivered at a higher premium than illustrated because underwriting placed the insured in a different class. What should the producer do at delivery?
- A policy is issued as applied for and delivered while the insured is alive, but the owner refuses to pay the first premium. Under the standard application agreement, what follows?
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