Colorado Life Producer License Practice Test

When should the Buyers Guide be presented to the applicant?

1. After the policy is issued

2. With the first premium payment

3. Before accepting the initial premium

4. At the time of the first claim

The correct answer is: Before accepting the initial premium

The Buyers Guide should be presented to the applicant before accepting the initial premium. This practice ensures that the applicant has a comprehensive understanding of the policy options available to them, including the various features and benefits of the insurance product, potential limitations, and any other relevant information that could influence their purchasing decision. Providing the Buyers Guide at this stage facilitates informed decision-making, allowing the applicant to ask questions and express any concerns prior to committing to a premium payment. It aligns with regulatory standards aimed at consumer protection within the insurance industry, ensuring transparency and helping to foster trust between the buyer and the insurance provider. Presenting the Buyer’s Guide at the point of initial premium payment, after the policy is issued, or at the time of the first claim would be too late in the process for the applicant to benefit fully, as they would not have the necessary information to make an informed decision about the insurance product at the outset.