The Medical Information Bureau (MIB) is used by life insurers primarily to:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
The MIB is a clearinghouse to which member life insurers report coded information on applicants' medical impairments. When a new application is submitted, the insurer can request an MIB report to check for inconsistencies with earlier applications made at other companies, which helps detect fraud and misrepresentation in underwriting. The MIB does not diagnose or treat applicants, and it does not set rates; it is an information exchange that supports the underwriting process. Applicants are entitled to receive their MIB file upon request and may correct inaccurate information that could affect future underwriting.
Why the other options are wrong
- B) The MIB is an information exchange among insurers, not a healthcare provider, and it does not treat applicants. The MIB report helps the insurer spot earlier applications that conflict with the current one.
- C) Premium rates are set by each insurer from its own mortality and expense assumptions, not by the MIB. It is a consumer information exchange, not a medical provider with any treatment responsibilities.
- D) The MIB has no role in prescribing or dispensing medications to insurance applicants. Each insurer independently sets its own premium rates from its own mortality, expense, and investment assumptions.
Memory hook
MIB: a coded memory of past impairments shared among insurers. It flags fibs; it does not doctor patients.