Life & Health Insurance Practice Exam

Who provides the insurer with a completed application and initial premium in exchange for insurance?

1. Applicants

2. Insurers

3. Underwriters

4. Beneficiaries

The correct answer is: Applicants

The applicants are the individuals or entities that seek insurance coverage and initiate the process by providing the insurer with a completed application along with the initial premium payment. This step is crucial as it formally starts the insurance contract process. The application typically includes essential information about the applicant's risk profile, which assists the insurer in assessing whether to offer coverage. In insurance transactions, the applicant's information allows the insurer to evaluate the risk and decide on underwriting the policy. After the application is reviewed, the insurer can determine whether to accept the risk and issue the policy based on the details provided by the applicant. Therefore, the role of the applicant is foundational to establishing the insurance agreement. Other roles such as insurers, underwriters, and beneficiaries pertain to different aspects of the insurance process. Insurers are the entities offering coverage, underwriters assess the risk based on the application, and beneficiaries are the individuals designated to receive benefits from the policy, but they do not engage in the initial application and premium transaction.