West Virginia State Life Insurance Practice Exam

When an insurance application is taken by a producer, which statement is accurate?

1. Changes made on the application require the applicant's initials

2. The producer can make changes without notifying the applicant

3. All changes do not need to be documented

4. The application remains valid without a signature

The correct answer is: Changes made on the application require the applicant's initials

When an insurance application is taken by a producer, it is essential that any changes made on the application require the applicant's initials. This practice ensures clarity and consent, allowing the applicant to acknowledge that they are aware of and approve any modifications to the information provided. This is a critical aspect of the application process, as it helps maintain the integrity of the application and protects both the producer and the applicant. If changes were made without the applicant's acknowledgement, it could lead to disputes or issues regarding the accuracy of the information presented, which is vital for underwriting and policy issuance. Therefore, requiring the applicant's initials serves to confirm that they are in agreement with the changes made.