Pennsylvania Life and Health Insurance Exam Practice Question
Prior to representing or acting on behalf of a consumer, what must a producer do?
Correct Answer: B
Rationale: A producer must execute a written agreement with the consumer to ensure clarity and legal compliance in their representation. This formal documentation protects both parties by outlining responsibilities and expectations.
Option A, submitting a verbal agreement, lacks the legal enforceability and clarity that a written contract provides. Option C, receiving premium in advance, is not a prerequisite for representation but rather a part of the transaction process. Option D, obtaining consent from the insurer, is not necessary for a producer to act on behalf of a consumer, as the focus should be on the consumer-producer relationship.
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