On August 6, D submitted an application for a $50,000 Life Insurance policy and did not pay the initial premium. On August 18, D went to his doctor complaining of chest pains. What action should the producer take when delivering the policy on August 20?

The correct action for the producer when delivering the policy on August 20 is to collect the initial premium along with a signed health statement. This is essential for several reasons.

First, when an applicant submits an application for life insurance without paying the initial premium, the insurer is typically not bound by the terms of the policy until that premium is collected. By obtaining the initial premium, the producer ensures that the policy will take effect upon delivery and minimizes any gaps in coverage.

Second, the applicant's visit to the doctor on August 18 regarding chest pains represents a significant change in their health status after the application was submitted. Insurance companies often require updated health information or a health statement to assess the risk based on these changes. By collecting a signed health statement, the insurer can evaluate whether the new information affects the underwriting process and the insurability of the individual.

Consequently, this step ensures that the insurer has all necessary information before providing coverage, maintaining the integrity of the underwriting process and protecting the company from unknown liabilities related to the recent health condition.