New Jersey Life Insurance Exam Practice Question
What is the result of an insurer approving an incomplete application?
Correct Answer: C
Rationale: When an insurer approves an incomplete application, it effectively waives the right to the missing information, thus binding itself to the terms of the policy. This means the insurer must honor the contract as issued.
Option A is incorrect because the insured is not required to complete the application post-issuance; the policy stands as is. Option B is misleading; while certain aspects may be reviewed, the approval implies acceptance of the application’s terms as they are. Option D is false, as agents cannot unilaterally complete applications after policy issuance; that responsibility lies with the insured.
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