New Jersey Life and Health State Practice Exam

What is likely to happen during the application process for life or health insurance?

1. Insurer will not examine medical history

2. Medical history may be reviewed and reported

3. Only the current health status will be considered

4. Insurers will rely solely on the applicant’s declaration

The correct answer is: Medical history may be reviewed and reported

During the application process for life or health insurance, one of the key steps involves a thorough evaluation of the applicant's medical history. This review is crucial because it helps insurers assess the overarching health risks associated with insuring an individual. By examining medical history, insurers can identify any pre-existing conditions, previous treatments, and other relevant health issues that may impact the underwriting process and determination of coverage. Insurers generally obtain this information through declarations made by the applicant, medical records, or even additional information from healthcare providers when necessary. This thorough approach allows insurers to make informed decisions regarding coverage eligibility, premiums, and policy terms. It also underscores the importance of the application process in ensuring that the risk is accurately assessed. In contrast, options suggesting that the insurer will not examine medical history, consider only current health status, or rely solely on the applicant’s declaration fail to recognize the comprehensive nature of the underwriting process, which typically combines information obtained from various sources, including a detailed medical history evaluation.