Massachusetts Life Producer Practice Exam

What document must be provided to a life insurance applicant upon receiving their application and initial premium?

1. Policy booklet

2. Conditional receipt

3. Final assessment document

4. Approval letter

The correct answer is: Conditional receipt

The document that must be provided to a life insurance applicant upon receiving their application and initial premium is a conditional receipt. A conditional receipt serves as temporary coverage or acknowledgment that the application and premium have been received, providing the applicant with some assurance that their coverage may begin immediately, pending approval from the insurer. This is important because it establishes that the insurer recognizes the application and may grant coverage based on the information provided, even before the policy is formally issued. The conditional receipt often contains specific terms and conditions, detailing what coverage is activated and under what scenarios it applies, which is crucial for both the insurer and the applicant. While brochures, letters, or other documents may also be involved in the application process, they do not offer the same level of immediate acknowledgment of coverage as a conditional receipt does. Such documentation is vital for clarifying the intentions of both parties and ensuring there is no confusion about when and how coverage is activated.