The Application

Question 1

Human life value approach

Answer 1

Probable future earnings of the insured using:

• Wages
• Inflation
• Years to retirement
• Time value of money

Question 2

Needs approach

Answer 2

The predicted needs of the family using: 

DIME

• Debt
• Income
• Mortgage
• Expenses

Question 3

Parts of application

Answer 3

1. General information
2. Medical
3. Agents report

Question 4

Risk classifications

Answer 4

Preferred: healthier than the standard risk; usually issued policies on a discounted premium basis

Standard: A normal or average risk; no special conditions are required in the policy

Substandard: A higher risk; require special conditions included in the policy or policy issued with higher/rated premiums

-gender or how much someone makes does not matter