If an insured is hospitalized with a heart condition when delivering a newly-issued policy, what should the producer do?

When an insured is hospitalized with a heart condition at the time of delivering a newly-issued policy, returning the policy to the insurer with an explanation is the appropriate course of action. This approach is rooted in the understanding that the insurer relies on the information provided during the application process to assess risk and determine eligibility for coverage. If the insured's health condition has changed significantly or if they are in a situation that could affect their insurability, it is both ethical and procedural to notify the insurer.

By returning the policy, the producer ensures that the insurer can reassess the situation considering the insured's current health status. This allows the insurer to determine whether the policy can still be honored or if amendments need to be made, such as adjustments in coverage or premiums based on the new information.

In contrast, collecting additional premium at the time of delivery, holding onto the policy until discharge, or delivering the policy to an immediate family member may not address the insurer's requirements for underwriting and could potentially expose the producer and the insurer to liability issues or coverage disputes during a time when the insured is unwell.