Study 3: Underwriting the Applicant

Question 1

Application

Answer 1

• A request by an insured for insurance
• May be done verbally, in writing, or online
• The insured provides information relating to the subject for insurance
• Insurer assess this info and decides whether to accept the risk for insurance and on the terms of such acceptance

Question 2

Aspects of Interest on an Application

Answer 2

• The applicant’s name
• The broker or agent
• The applicant’s telephone contact numbers
• The desired effective and expiry dates
• The applicant’s occupation
• The applicant’s loss experience
• Whether the applicant has been cancelled by any previous insurers
• Whether the applicant qualifies for any premium discounts
• Who signed the application and how was it signed

Question 3

Named Insured(s)

Answer 3

The person or party designated in the policy as the insured, who has certain rights under the policy, as opposed to someone who may be covered by the policy but is not specifically named and does not have the same rights as the named insured.

Question 4

Homeowners policy

Answer 4

A multi-peril insurance policy for dwelling risks, combining coverages for fire and extended coverages, including theft and liability

Question 5

Personal-lines insurance

Answer 5

Insurance for individuals and families, such as private passenger auto insurance and homeowners policies

Question 6

Business Insurance

Answer 6

• Broad name for different coverage available to a business owner to protect against losses and to insure the continuing operation of the business
• Includes business property, life, accident, and sickness including that for key employees, liability, and fleet of automobile

Question 7

Additional Insured

Answer 7

A person other than the named insured who is protected by the terms of the policy. The additional insured may be named or unnamed.

Question 8

Additional Named Insured

Answer 8

Any party, other than the original named insured, identified as an insured in the policy declarations. An additional named insured has more right under the policy than does an additional insured but also more responsibilities.

Question 9

Back-dated policy

Answer 9

A policy that will become effective retroactively after the applicant applies for it