Washington Life Producer Practice Exam

What is one potential requirement for an applicant with a dangerous occupation?

1. Higher premiums based on risk

2. Immediate approval of coverage

3. Reduced coverage limits

4. No requirement for medical exam

The correct answer is: Higher premiums based on risk

For an applicant with a dangerous occupation, one potential requirement is higher premiums based on risk. Insurers assess the level of risk associated with different occupations, and those considered hazardous typically lead to increased likelihood of accidents or health issues that could result in claims. Consequently, insurers adjust the premiums to reflect the higher risk, which means the applicant is likely to pay more for their coverage compared to someone in a less risky job. The adjustment in premiums helps the insurer mitigate potential losses resulting from underwriting a policy for someone engaged in a dangerous occupation.