Indiana State Life and Health Insurance Practice Exam

In Indiana, which of the following must be delivered to a policyowner upon the sale of an individual life insurance policy?

1. Insurers AM Best rating

2. The written sales proposal

3. Policy Summary and Buyer's Guide

4. Buyer's Guide only

The correct answer is: Policy Summary and Buyer's Guide

When selling an individual life insurance policy in Indiana, the law requires certain documents to be delivered to the policyowner to ensure transparency and informed decision-making. The correct choice indicates that both a Policy Summary and a Buyer's Guide must be provided. The Policy Summary outlines the key features of the policy, including coverage amounts, benefits, premiums, and other essential details, allowing the policyowner to understand what they are purchasing. The Buyer's Guide is designed to inform consumers about the general practices of life insurance, giving them crucial information about their options, types of policies, and questions to consider before making a purchase. Delivering these documents serves to protect consumers by ensuring they have access to all the necessary information to make informed choices about their life insurance needs. This aligns with state regulations aimed at promoting consumer education and transparency in the insurance industry. In contrast, while the other options may provide useful information, they do not fulfill the legal requirement mandated for the sale of an individual life insurance policy. For example, an insurer's AM Best rating pertains to the company's financial strength and stability, which is informative but not required upon the sale of the policy. Similarly, while a written sales proposal offers insights into the policy's terms as highlighted by the agent, it does not