Chapter 3 exam.fx

Which of the following settlement options in life insurance is known as Straight life

Life income

The type of settlement option which pays throughout the lifetime of two or more beneficiaries is called

Joint and survivor

What provision in an insurance policy extends Coverage beyond the premium today

Grace period

Which of the following statements about the reinstatement provision is true

It requires the policyowner to pay all overdue premiums with interest before the policy is reinstated.

At the time the insured purchased her life insurance policy, she added a rider that will allow her to purchase additional insurance in the future without having to prove insurability. This rider is called

Guaranteed insurability

According to the entire contract provision, a policy must contain

A copy of the original application for insurance

Which of the following is true about the mandatory free look in a life insurance policy

It commences when the policy is delivered

Which of the following allows the insured to relieve a minor insured from premium payments in the minors parents have died and become disabled

Pay your benefit

When the policy owner specifies a dollar amount in which installments are to be paid, he/she has chosen which settlement option?

a fixed amount

Which of the following information will be stated in the consideration clause of the life insurance policy?

The amount of premium payment

And insured owns $50,000 whole life policy at age 47, the insured decides to cancel his policy and exercise the extended term option from the policies cash value, which is currently $20,000 what would be the face amount of the new term policy

$50,000

Which of the following best describes fixed. Settlement option

Both the principal and interest will be liquidated over a selected time period

Which of the following statements about the suicide clause is a life insurance policy is true

Suicide is excluded for a specific period of years in cover there after

What is the purpose of a fixed period settlement option?

To provide a guaranteed income for a certain amount of time

An individual is purchasing a permanent life insurance with a face value of fifth $25,000 well this is an insurance that he can afford at this time he wants to be sure that additional coverage will be available in the future which of the following actions should be included in the policy?

Guaranteed insurability option

An insured misstates her age at the time the life insurance application was taken. This misstatement may result in

Adjustment in the amount of death benefit

And insured has had a life insurance policy that he purchased three years ago when he was 40 years old. He has killed in an automobile accident and it is discover that he's actually 45 years old and not 43 as stated on the application what will the company do?

Pay a reduced death benefit

Who can request changes in premium payments, face value, loans, and policy plans?

Policyowner

And insured received an annual life insurance dividend check. What term best describes this arrangement

Cash option

Which provision of a life insurance policy states that the ensures duty to pay benefits upon the death of the insured and to whom the benefits will be paid

Insuring class

And insured purchased a life policy in 2010 and died in 2017. The insurance company discovers at that time that the insured had a missed stated information during the application process. What can they do

Pay the death benefit

If the policy owner, the insured, and the beneficiary under a life insurance policy or three different people, who has the ownership rights?

Policyowner

The rider in a whole life policy that allows the company to forgo collecting the premium if the insured is disabled is called

Waiver of Premium

According to the entire contract provision, what document must be made part of the insurance policy

Copy of the original application

If an insured under any variable life insurance policy dies, how will the insurance respond to outstanding policy loans

The loan amounts are deducted from the death benefit

Under which of the following circumstances would insurer pay accelerated benefits?

And insured is diagnosed with cancer and needs help the pain with her medical treatment

The policy owner wants to make sure that upon his death, the life policy will pay a portion of the proceeds annually to his spouse, but that the principal will be paid to their children when they reach a certain age. Which settlement option should the policy owner choose?

Interest only option

Which of the following explains a policy owners right to change the beneficiaries, choose options, and receive proceeds of a policy

Owner's Rights

And insured has a life insurance policy from a participating company and received quarterly dividends. He has instructed the company to apply the policy dividends to increase the death benefit. The dividend option that the insured has chosen is called

Paid up additions

What is the waiting period on a waiver of premium writer in life insurance policies

Six months

Which of the following determines the length of time that benefits will be received under the fixed amount settlement option

Size of each installment

Which nonforfeiture option has the highest amount of insurance protection

Extended term

Which option is being utilized with the insurer accumulates dividends and interest and then uses the accumulated dividends, plus interest, and the policy cash value to pay the policy up early?

Paid up option

A couple owns a life insurance policy with the children's term rider. Their daughter is reaching the maximum age of dependent coverage, so she will have to convert to permanent insurance in the near future. Which of the following will she need to provide for proof of insurability?

Proof of insurability is not required

An insured had a $10,000 term life policy. The annual premium of $200 was due on February 1; however, the insured failed to pay the premium. He died on February 28. How much would the beneficiary receive from the policy

$9,800

What happens when a policy is surrendered for its cash value

Coverage ends and the policy cannot be reinstated

The provision which states that both the policy and a copy of the application form the contract between the policy owner in the insurer is called the

Entire Contract

All of the following are dividend options except

Fixed period installments

It's a settlement action is not chosen by the policy owner or the beneficiary which option will be used

Lump sum

Which of the following, when attached to a permanent life insurance policy, allows the policy owner to customize the policy to provide an additional amount of temporary insurance on the insured, or allows amount of temporary insurance to cover other family members?

Term rider

And insured and his wife have both been involved in a head on collision the husband dies instantly in the WiFi 15 days later the company pays the death benefit to the estate of the insured this indicates a life insurance policy had what provision

Common disaster

Which of the following statements is true about policy assignment

It transfers rights of ownership from the owner to another person.

All of the following are true statements regarding the accumulation of interest options except

The interest is not taxable since it remains inside the insurance policy

The dividend option in which the policy owner uses dividends to purchase a term policy for one year is referred to as

One-year term option.

Which nonforfeiture option provides coverage for the longest period of time?

Reduced Paid-Up

A father owns a life insurance policy on his 15-year-old daughter. The policy contains optional payor benefit rider. If the father becomes disabled, what will happen to the life insurance premiums

the insured's premiums will be waived until she is 21.

The insured had his wife's name as a beneficiary of his life insurance policy. To ensure that his wife had income for life after the insurance that he chose the life income settlement options. The amount of payment will be determined by taking into account all of the following except

The insured's age of death

Which of the following riders would NOT cause the Death Benefit to increase?

payor benefit rider

A father purchases a life insurance policy on his teenage daughter in as a pair benefit rider in which of the following scenarios will the rider waive the payment of premium

If the father is disabled for more than 6 months

Which life insurance settlement option guarantees payment for a lifetime of the recipient, But also specifies a guaranteed., During which, if the original recipient dies, the payment will continue to a designated beneficiary

Life income with period certain

If a policy has an automatic premium loan provision, what happens if the insured dies before the loan is paid back?

The balance of the loan will be taken out of the death benefit

The validity of coverage under a life insurance policy may not be contested except for nonpayment of premium, after the policy has been in force for at least how many years

2 years

Life income joint and survivor settlement option guarantees

income for 2 or more recipients until they die

What type of insurance would be used for a return premium rider

increasing term