What action is REQUIRED by a producer when replacing an existing life insurance policy?

The correct action required by a producer when replacing an existing life insurance policy is to submit to the replacing insurer a list of the policies to be replaced. This requirement is crucial because it helps ensure that all parties involved—especially the replacing insurer—are fully informed of the existing coverage that the policyholder is relinquishing. This transparency is important for assessing potential gaps in coverage or changes in risk, and it also ensures compliance with any legal or regulatory obligations regarding replacements.

Maintaining proper records and communicating with the existing insurer are both important in the process, but the specific requirement to submit a list of the policies ensures that the replacing insurer can properly evaluate the situation and provide the appropriate coverage to the policyholder. It helps prevent situations where policyholders may be underinsured or misinformed about their new coverage.

Understanding these requirements is essential for producers to ensure compliance with industry regulations and to protect consumers’ interests in the often complex process of replacing insurance policies.