Chapter 3 Life Policy Provisions, Riders, and Options

The accelerated benefits provision will provide for an early payment of the payment of the death benefit when the insured.

Becomes terminally ill

The insured under a 100,000 life insurance policy with a triple indemnity rider for accidental death was killed in a car accident. it was determined that the accident was his fault. The triple indemnity rider in the policy specifies that the death must not contributed to by the insured any manner, in this case , what will the policy beneficiary receive?

100,000

An insured owns a $50,000 whole life policy. At age 47, the insured decides to cancel his policy and exercise the extended term option for the policy's cash value, which is currently $20,000. What would be the face amount of the new term policy?

50,000

An insured purchased a Life Insurance policy on his life naming wife as primary beneficiary, and his daughter as contingent beneficiary. Under what circumstances could the daughter collect the death benefit?

If the primary beneficiary predeceased the insured.

When a reduced-paid up nonforfeiture option is chosen, what happens to the face amount of the policy.

It is reduced to the amount of what the cash value would buy a single premium.

Which of the following is true of a children's rider added to an insured's permanent life insurance policy?

It is term coverage that is convertible to permanent insurance at or prior to the child reaching the maximum coverage age.

All the following are true regarding insurance policy loans EXCEPT.

Policy loans can be made on policies that do not accumulate cash.

when a life insurance policy was issued, the policyowner designated a primary and a contingent beneficiary. Several years later, both the insured and the primary beneficiary died in the same car accident, and it was impossible to determine who died first. Which of the following would receive the death benefit?

The insured's contingent beneficiary

An insured has chosen joint and 2/3 survivor as the settlement option. What does this mean to the beneficiaries?

The surviving beneficiary will continue receiving 2/3 of the benefit paid when both beneficiaries were alive.

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

Fixed amount

What is the name of the clause that is included in a policy that limits or eliminates the death benefit if the insured dies as a result if war or while serving the military?

War or military service