What is TRUE regarding a life and health agent without specific appointment by the insurer?

When an agent operates without a specific appointment by an insurer, it is true that if the insurer issues a policy based on the agent's efforts, this action effectively implies authorization of that agent's activities. This practice is significant because it allows for a level of flexibility within the relationship between agents and insurance companies.

Most insurance regulations require that agents be appointed by an insurer to represent them officially, which protects consumers and ensures that agents are acting under the company's guidelines. However, if an insurer chooses to issue a policy based on an agent's application, this can retroactively create an authority for the agent, thereby legitimizing their role in that specific transaction.

The importance of this answer lies in its acknowledgment that actions taken by the insurer (such as issuing a policy) can create a de facto appointment, allowing the agent to receive commissions and perform other roles typically associated with an appointed agent. This mechanism ensures that agents can still engage in business, even if they haven't gone through the full appointment process initially, provided that the insurer validates their efforts by issuing a policy.