Chapter 4 Life Provisions

30 May 2023
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Which of the following is NOT part of an insurance contract?
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Certificate of Authority
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Life insurance policies will normally pay for losses arising from
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Commercial aviation
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If an insured's age on a life insurance policy has been misstated, what is the insurer's liability if the insured dies?
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A prorated death benefit based on the amount of insurance the insured's premiums would have been if purchased at the correct age
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Matt is applying for life insurance and requests a double indemnity rider. A double indemnity benefit will be payable to Matt's beneficiary if Matt
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dies instantly from a car accident
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An insured individual and the policy's beneficiary die from the same accident. The common disaster provision states the insurer will continue as if
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the insured outlived the beneficiary
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All of these are common exclusions to a life insurance policy EXCEPT
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accidental death
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What is an insurance policy's grace period?
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Period of time after the premium is due but the policy remains in force
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Which type of rider will waive the premium on a child's life insurance policy if the parent paying the premium dies?
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Payor benefit
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What is the name of the provision which states that a copy of the application must be attached to the policy when issued?
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Entire Contract
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Which of these is considered to be a Living Benefit option in a life insurance policy?
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Accelerated death benefit
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The free-look provision gives the policyowner
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the right to return the policy for a full refund within a specified number of days
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A whole life insurance policy accumulates cash value that becomes
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the policy loan value which the insured may borrow against
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The suicide clause of a life insurance policy states that if an insured commits suicide within a stated period from the policy's inception, the insurer will only be liable for a return of premiums paid
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minus indebtedness and without interest
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Which of these is NOT a characteristic of the Accelerated Death Benefit option?
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The benefit can be offered as a rider at a specific extra cost or may be at no cost Accelerated Death Benefit options are offered with NO increase in premium.
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Which of the following is a reinstatement condition?
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Proof of insurabiilty
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Which of the following is considered to be an alternative to a life settlement?
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Accelerated death benefit rider
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Which dividend option would an insurer invest the policyowner's money and add any interest earnings as the dividends accrue?
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Accumulation at Interest Option
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Kurt is an active duty serviceman who was recently killed in an accident while home on leave. Which military service exclusion clause would pay upon his death?
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Results The "results clause" states the insurer is excused from paying the amount only if the death is a result of war.
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A provision in a whole life policy that allows a policyowner to terminate the policy in return for a reduced paid-up policy of the same type is called a(n)
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nonforfeiture provision
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Barbara's policy includes a rider which allows her to purchase additional insurance at specific dates or events without evidence of insurability. This rider is called a(n)
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Guaranteed insurability rider
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Loans obtained by a policyowner against the cash value of a life insurance policy
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would not be treated as taxable income
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Which of these is NOT considered to be a nonforfeiture option in a whole life insurance policy?
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Interest only
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An endorsement found in an insurance plan which modifies the provisions of the policy is called a .
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rider
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In what part of an insurance policy are policy benefits found?
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"Declarations". Essentially, the insurance declaration page is like a quick guide to the insurance policy, providing all of the basic information the policyholder needs to know
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Dorian exercised a nonforfeiture option by using his life policy's cash value to purchase an extended term insurance option. When the term insurance expires,
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the protection ends
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Under a life insurance policy, what does the insuring clause state?
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he insurer's obligation to pay a death benefit upon an approved death claim While a life policy is in force, the insuring clause states the insurer's obligation is to pay the death benefit to the beneficiary when a death claim is approved.
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The automatic premium loan provision authorizes an insurer to withdraw from a policy's cash value the amount of
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past due premiums that have not been paid by the end of the grace period
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A provision that allows a policyowner to temporarily give up ownership rights to secure a loan is called a(n)
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collateral assignment