LLQP Underwriting and Risk Analysis 5

Question 1

An underwriter reviewing a life application notices the proposed insured's build table shows a height of 5'10" and weight of 285 lbs. What underwriting consideration does this primarily raise?

Accepted Answer

Excess weight increases mortality risk and may result in a rated or declined policy

Answer

Obesity is a significant mortality risk factor because it correlates with conditions like heart disease, diabetes, and hypertension, typically resulting in a rated premium or possible decline.

Question 2

What is the function of the MIB Group (formerly Medical Information Bureau) in the underwriting process?

Accepted Answer

To serve as a clearinghouse of coded medical information shared among member insurers to detect misrepresentation

Answer

MIB maintains a coded database of significant health and lifestyle information reported by member insurers, helping underwriters identify inconsistencies or omissions in applications.

Question 3

A proposed insured is a 55-year-old with a family history of cardiovascular disease—both parents died of heart attacks before age 60. How does this typically affect underwriting?

Accepted Answer

It may result in a rating because premature family cardiovascular history increases mortality risk

Answer

Premature cardiovascular death in first-degree relatives is a recognized mortality risk factor that underwriters may use to justify a rating, particularly when multiple close relatives are affected.

Question 4

Which risk classification term describes an applicant whose expected mortality is significantly better than the average standard applicant?

Accepted Answer

Preferred or super-preferred

Answer

Preferred or super-preferred classifications are awarded to applicants with excellent health profiles, favorable family history, and no hazardous activities, resulting in lower premiums than standard.

Question 5

When an insurer applies a 'table rating' to a life insurance policy, what does 'Table B' or 'Table 2' typically indicate?

Accepted Answer

The insured is rated at 150% of standard mortality, indicating a moderately elevated risk

Answer

Table ratings (A through P, or 1 through 16) each represent an incremental increase in mortality of approximately 25%, so Table B/2 equals roughly 150% of standard mortality.

LLQP - Life License Qualification Program Practice Test

LLQP - Life License Qualification Program Practice Test

LLQP Underwriting and Risk Analysis 5