What type of receipt is typically given to an applicant who pays the initial premium at the time of application?

The correct answer is that a conditional receipt is typically given to an applicant who pays the initial premium at the time of application. This type of receipt indicates that the coverage is conditional upon certain criteria, which are usually outlined within the receipt itself. Specifically, the coverage becomes effective only if the applicant meets specific underwriting requirements set by the insurer, and the application is eventually approved.

In many instances, the conditional receipt serves an important function by providing immediate evidence of insurance coverage after the payment is made, even though the policy has not been finalized. This is particularly valuable to applicants because it offers some level of peace of mind that they are protected during the underwriting process, pending the insurer's decision.

Other types of receipts serve different purposes. A final receipt is typically given once the policy is issued, confirming the policyholder’s acceptance of the terms and providing evidence of enacted coverage, but it does not directly relate to the initial payment scenario. A provisional receipt is less common and often signifies that the insurer is willing to consider the application but does not necessarily provide the immediate coverage that a conditional receipt does. A temporary receipt usually indicates interim coverage but lacks the same specificity regarding the conditional status attached to the underwriting process that a conditional receipt implies.