Underwriting and Policy Issue Flashcards
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Read the first 7 Underwriting and Policy Issue flashcards as text
Which of the following would most likely result in an outright declination by an underwriter?
Answer: An applicant recently diagnosed with terminal cancer
A terminal illness typically represents an uninsurable risk, and most insurers will decline to issue a standard life insurance policy.
What is the significance of the 'free-look period' after a policy is delivered?
Answer: The policyholder can return the policy for a full refund within a specified period
The free-look period (typically 10-30 days) allows policyholders to review and return a policy for a full premium refund if unsatisfied.
When reviewing an application, an underwriter notices the applicant listed a different physician than in a previous application. This discrepancy would most likely trigger:
Answer: An Attending Physician Statement (APS) request
An Attending Physician Statement (APS) is requested when underwriters need more detailed medical information to evaluate a risk properly.
Which underwriting source provides information directly from the applicant's own physician?
Answer: Attending Physician Statement (APS)
An APS is a statement from the applicant's treating physician providing details about diagnoses, treatments, and prognosis.
A policy issued exactly as applied for with no modifications is said to be issued:
Answer: On a standard basis
When a policy is issued exactly as applied for at standard rates, it has been issued on a standard basis without modification.
What is the role of an 'underwriting manual' in the policy issuance process?
Answer: It provides guidelines for classifying risks and setting premium rates
An underwriting manual contains the insurer's guidelines for evaluating risks, classifying applicants, and determining appropriate premiums.
Which of the following best describes 'policy issue' in the insurance process?
Answer: The formal creation and delivery of the insurance contract to the policyholder
Policy issue refers to the process of formally creating the insurance contract and delivering it to the policyholder after underwriting approval.