5/2 Quiz

What are the two types of war/military service exclusions?

The two kinds of war/military service exclusions are: status clause and results clause. The correct answer is: Status clause and results clause

All of the following statements are true of the modifications provision in a life insurance policy, EXCEPT:

Insurance producers cannot make any policy change. The correct answer is: Insurance producers can make any policy change.

What happens if an insured commits suicide 3 years after the policy inception?

If the insured commits suicide more than 2 years after the policy is in place, the insurer will pay the death benefit. The correct answer is: The death benefit is paid.

The aviation clause excludes all of the following accidents, EXCEPT:

The aviation exclusion states that the insurer will not pay the claim if the insured dies due to involvement with aviation, such as a military pilot flying a jet aircraft. Individuals flying in commercial aircraft as fare-paying passengers would not be excluded from coverage. The correct answer is: Individual who dies while flying in a commercial aircraft as a fare-paying passenger

All of the following life insurance provisions are considered exclusions, EXCEPT:

The cash loan provision is a policy loan provision, not an exclusion. The correct answer is: Cash loan

Randy drives racecars and scuba dives in his spare time. Will he be able to purchase life insurance with these types of hobbies?

He will be able to purchase insurance, but the premiums will be higher to compensate for the additional risk. The correct answer is: He will be able to purchase life insurance but his premiums will be higher.

In addition to being a commercial pilot, Michael also flies his own private small plane. What will most likely happen when he applies for life insurance?

Most insurance companies do not deny coverage if a person is involved in aviation. They charge a higher premium to balance the added risk. The correct answer is: He will be charged a higher premium to compensate for the added risk.

Chuck is in the military. How does this affect payment of the death benefit on his life policy?

His policy will exclude death while on active military service. The correct answer is: His policy excludes death while on active military service.

All of the following statements are false regarding the modifications provision in a life insurance policy, EXCEPT:

Modifications are policy changes and must be made by an authorized officer of the insurer and attached to the policy. Only the policyowner has the right to request changes. Insurance producers cannot make any policy change. Changes to the policy can only be implemented by an executive officer of the insurer. The correct answer is: Changes to the policy can only be implemented by an executive officer of the insurer.

George bought a $300,000 whole life policy when he was employed as a bank teller. Four years later, he changes jobs and begins working in a coal mine. If he is killed while working in the mine, what will the insurer do?

The insurer will pay the claim. If an exclusion or limitation was not placed on the insured's application upon policy issuance, the insurer will be required to pay the claim. The correct answer is: Pay the claim

How long is the suicide clause typically in effect?

The suicide clause is typically in effect for two years from the policy effective date. The correct answer is: Two years from the policy effective date

To prevent individuals intending to commit suicide from purchasing life insurance, policies in clued a suicide clause. How long is the suicide clause in effect.

The suicide clause specifies that if death is by suicide during the first two years, no death benefit is paid. The correct answer is: 2 years

What will the insurance company do if an insured commits suicide after the suicide clause expires?

The insurance company will pay the death benefit if the insured commits suicide after the suicide clause lapses. The correct answer is: Pay the death benefit

An insured commits suicide while the suicide clause is in effect. What will the insurer do?

If the insured commits suicide while the suicide clause is in effect, the insurer will not pay the death benefit. Instead, the insurer will return the premiums to the beneficiary. The correct answer is: Return all premiums to the beneficiary

Which of the following is a situation where the insurance company refunds premiums paid?

If an insured commits suicide during the suicide clause period, the insurer will refund the premiums to the beneficiary. The insurer is not required to pay the policy's cash value (premiums plus interest) to the beneficiary. The correct answer is: Insured commits suicide during the suicide clause period

Which of the following is a provision that requires any change to a life insurance policy be made by an executive officer of the insurer, and attached to the policy?

Modifications are policy changes and must be made by an authorized officer of the insurer and attached to the policy. Only the policyowner has the right to request changes. Insurance producers cannot make any policy change. Changes to the policy can only be implemented by an executive officer of the insurer. The correct answer is: Modifications

Mr. Brown committed suicide during the suicide clause of hit insurance policy. The insurance company will:

If the insured commits suicide while the suicide clause is in effect, the insurer will not pay the death benefit. Instead, the insurer will return the premiums to the beneficiary. The correct answer is: Return all premiums to the beneficiary

Which provision in a life insurance policy provides the insurer with the right of medical examination and autopsy?

Insurers may require the proposed insured undergo a medical examination prior to issuing coverage at the insurer's expense, if necessary, such as for large amounts of coverage. The insurer may also request a deceased insured to undergo autopsy for good cause, if not prohibited by state law, while a claim is pending. The correct answer is: Medical examination and autopsy

All of the following are types of life insurance policy loan and withdrawal provisions, EXCEPT:

There are three types of policy loan and withdrawal provisions for life insurance policies: cash loan, automatic premium loan (APL), and withdrawals or partial surrenders. The correct answer is: Modifications

What is the purpose of the hazardous occupation clause?

Under the hazardous occupation clause, if the insured dies as a result of a hazardous occupation or hobby, the insurer will not pay the claim. The correct answer is: To exclude losses if the insured dies as a result of a hazardous occupation or hobby