Policy Delivery Flashcards
Constructive or legal delivery
occurs only if the premium was paid at the time of application.
What happens if policy is not approved
If a policy is not approved as applied for, the insurer may make a “counteroffer” to the applicant. The insurer may issue a policy with a surcharge (higher rating) or exclusions to the policy.
The producer must hand-deliver the policy to the applicant to collect any additional premium, explain the changes in coverage and premium, and reinforce the value of the contract.
What happens if the intital premium is not paid with the application?
he producer must collect the premium before coverage can begin. The producer must also get a signed Statement of Good Health from the applicant/insured at the time of policy delivery that verifies that the insured has not suffered injury or illness, had any surgeries, or been admitted to a hospital since the application date. If the applicant is not in good health, the policy should be returned to the insurer for further underwriting.
