Question

If an insurer accepts the coverage as applied for, when does coverage begin?

A. On the application date
B. On the policy issue date
C. On the effective date
D. On the premium payment date

Answer 1

Coverage begins on the effective date specified in the policy once an insurer accepts the coverage as applied for. This date is crucial as it indicates when potential claims may be covered under the policy terms.

Step-by-step explanation:

If an insurer accepts the coverage as applied for, coverage generally begins on the effective date specified in the policy, which is option C. The application date is simply when the application is filled out and submitted. The policy issue date is the date when the insurance company officially issues the policy. The premium payment date is the date when the premium is paid. However, it is the effective date that is the critical date as it signifies when the coverage actually starts and from which claims can potentially be covered, assuming premiums are paid and the policy is active.