Ch 6: Underwriting

Question 1

What are Non-medical applications?

Answer 1

Policies that don’t require medical examination, and tend to be low dollar amounts.

Question 2

What’s required from the applicant for APS?

Answer 2

Requires a signed authorization from the applicant.

Question 3

What is the Medical Information Bureau (MIB)?

Answer 3

A non profit organization supported by member insurance companies.

Question 4

What’s contained in MIB reports?

Answer 4

Disability and health conditions discovered during exams affecting insurability.

Question 5

What happens in inspection reports/special questionnaires and what kind of polices are affected?

Answer 5

Large polices may involve independent investigation of the applicant through interviews.

Question 6

How do insurers avoid discrimination with HIV/AIDS testing?

Answer 6

Required for policies that exceed a certain amount, and require applicants to sign a separate disclosure form to allow for this testing.

Question 7

What are the three acceptable ratings?

Answer 7

Preferred risks, standard risks, and substandard risks

Question 8

Of the three risk ratings, which one pays the lowest premium?

Answer 8

Preferred risk

Question 9

What are the three factors that determine life insurance rate (premiums)?

Answer 9

Mortality
Interest (investment return)
Expenses