This may be the case if an applicant needs immediate protection but wishes to postpone the issuance of the permanent insurance policy for a period of between three and six months. For example, when an applicant receives a “term life insurance agreement” during the underwriting process of their life insurance application, the applicant essentially receives immediate life insurance coverage while the underwriting process takes place. In this scenario, the claimant is considered insured, whether they are actually considered insurable. The premiums calculated for this type of maturity coverage are generally based on the applicant`s current age at the time of application. The premium for the main life insurance policy, which will eventually be acquired, is based on the age of the applicant at the end of the transition period. These types of agreements often differ depending on the insurance company and the specific situation. Typically, conditional coverage persists until the insurance company is reimbursed for the premium, or accepts the risk and issues the policy. Coverage under a conditional receipt assumes that the insured person has met all medical requirements and is insurable on the basis of the premium claimed. A term insurance agreement (TIA) is a mandatory contract issued by a life insurance agent between a life insurance company and an applicant.
Where an applicant is granted a period of limited duration, he or she does not receive a receipt. However, the Term Insurance Contract (TIA) offers the applicant insurance for a specified period of time until the policy is issued. This essentially means that if the claimant died during this period, his beneficiary would receive a death benefit. Many receipts have different conditions. Some examples could be, but are not limited to: Other terms you may hear, which may have similar (or even slightly different) meanings: conditional receipt, conditional receipt, mandatory receipt, application for term insurance and agreement, limited insurance contract, etc. .