What must an applicant sign when a life insurance policy is replaced?

When a life insurance policy is replaced, the applicant is required to sign a Notice regarding replacement of life insurance. This notice serves several important purposes. It informs the applicant about the implications of replacing an existing policy with a new one, including potential loss of benefits, changes in premiums, and the possibility of lapsing the old policy, which could affect coverage.

The notice is designed to protect consumers by ensuring they are fully aware of the consequences of their decision to replace an insurance policy. It emphasizes the importance of understanding the features and benefits of both the existing policy and the new policy being considered. This practice is in line with regulations that aim to promote informed decision-making among policyholders.

Other options such as notices regarding premium assessment, policy amendments, or beneficiary designations do not specifically address the act of replacing a life insurance policy and therefore are not required in this context.