Section 3 Chapter Exam 2 - Life Provisions

B owns a Whole Life policy with a guaranteed insurability option that allows him to purchase, without evidence of insurability, stated amounts of

Additional Whole Life coverage at specified times

A cost of living rider gives the insured:

Additional death benefits

L takes out a life insurance policy and dies 10 years later. During the claim process, the insurer discovers that L had understated her age on the application. Under the Misstatement of Age provision, the insurer will:

Adjust the death benefit to a reduced amount

The consideration clause in a life insurance contract contains what pertinent information?

Amount of premium payments and when they are due.

What does the insuring agreement in a Life insurance contract establish?

An insurer's basic promise.

In a life insurance policy, which provision states who may select policy options, designate and name a beneficiary, and be the recipient of any financial benefits from the policy?

Owner's rights

T took out a $50,000 life insurance policy with an Accidental Death and Dismemberment rider. Five years later, T commits suicide. How much will the insurer pay?

$50,000

A policy loan is made possible by which of these life insurance policy features?

Cash value provision

A Whole Life insurance policyowner does NOT have the right to:

Change the grace period

D owns a Whole Life policy that was purchased 10 years ago. If the premium payments suddenly stop and D takes no additional action, which Nonforfeiture Option will the insurer likely proceed with?

Extended term

The purpose of the_____ Period clause is to avoid an unintentional lapse of a life insurance policy.

Grace

The advantage of reinstating an original life policy is:

The premiums are based on a younger age

All of these Settlement options involve the systematic liquidation of the death proceeds in the event of the insured's death, EXCEPT:

Interest only

Which of these are NOT an example of a Nonforfeiture option?

Life income

All of the following statements are true regarding a policy's Grace period, EXCEPT:

Past due premiums are waived

The Consideration clause in a life insurance policy indicates that a policyowner consideration consists of a completed application and

Paying the initial premium

A provision in a life insurance policy that pays the policyowner an amount that does not surpass the guaranteed cash value is called the:

Policy Loan provision

The_____ has the right to change a life insurance policy's beneficiary:

Policyowner

A(n)_____ rider may be used to include coverage for children under their parent's life insurance policy.

Term

Which of these life insurance riders allows the applicant to have excess coverage?

Term Rider