Which type of receipt is used only when the applicant submits a prepaid application?

The correct answer is Conditional Receipt, as it specifically pertains to situations where the applicant submits a prepaid application for life insurance coverage. When an applicant pays their premium at the time of application, they receive a conditional receipt that indicates the insurance coverage will begin, contingent upon the insurer's acceptance of the application.

This type of receipt serves as temporary evidence of insurance coverage while the insurance company evaluates the application. If the company approves the application, the coverage is backdated to the date of the application, meaning the applicant's insurance begins from that point. If the application is declined, however, the conditional receipt holds no value, and the coverage is voided.

In contrast, the other types of receipts offered serve different purposes. A premium receipt is typically given after the first premium is paid but does not guarantee coverage until the application is approved. A standard receipt is generally just an acknowledgment of payment without any conditions regarding coverage. A final receipt indicates that the policy has been issued and is often provided at the delivery of the policy, confirming the policyholder’s acceptance and payment of the premium, but is not involved in the initial application process.