When assessing the admissibility of a life insurance application, an underwriter discovers that the applicant, a 50-year-old self-employed artist from Nova Scotia, has a history of two driving under the influence (DUI) convictions in the past three years. How would this information typically impact the underwriting decision?

Question: When assessing the admissibility of a life insurance application, an underwriter discovers that the applicant, a 50-year-old self-employed artist from Nova Scotia, has a history of two driving under the influence (DUI) convictions in the past three years. How would this information typically impact the underwriting decision?

Answer options: ✅ It would likely lead to an offer of coverage with a higher premium or decline due to increased mortality risk.

• It would not affect the underwriting decision as it's unrelated to health.
• The insurer would ignore it because it's a criminal matter, not a health one.
• The insurer would be legally obligated to provide standard coverage regardless of criminal history.

Correct answer: It would likely lead to an offer of coverage with a higher premium or decline due to increased mortality risk.

Explanation: Underwriters consider all factors that may influence mortality risk, including lifestyle choices, hazardous activities, and moral hazards like a history of DUI convictions. These factors often lead to higher premiums (substandard rating) or a decline due to increased risk.