Chapter Exam 2- Life Provisions

Waiver of Premium

A life insurance policy which ensures that the premium will be paid if the insured becomes disabled has what kind of rider attached?

guaranteed values even if the policy has lapsed

A nonforfeiture clause gives the policyowner

Cash Value Provision

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

20-Pay life accumulates cash value faster than straight Life

A potential client, age 40, would like to purchase a Whole Life policy that will accumulate cash value at a faster rate in the early years of the policy. Which of these statements made by the producer would be correct?

Policy Loan Provision

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

change the grace period

A whole life insurance policyowner does NOT have the right to:

contest a claim during the Contestable Period

the incontestable clause allows an insurer to:

Modify a provision in the insurance contract

which of these is NOT considered to be a right given to a policyowner?

Child term rider

which rider provides coverage for a child under a parent's life insurance policy?

Interest Only

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

Pay face amount minus the past due premium

M had an annual life insurance premium payment due January 1. She died January 10 without making the premium payment. What action will the insurer take?

Exclusion

N is a student pilot with a large life insurance policy. Which of these features would limit the insurer's obligation in the event N was killed while flying as a student pilot?

Automatic Policy Loan

S has a whole life policy with a premium payment due soon. Which provision would keep the policy in force is S does not make the required payment and the policy has adequate cash value from which the premium payment can be made?

$50,000

T took out a $50,000 life insurance policy with an Accidental Death and Dismemberment rider. 5 years later, T commits suicide. How much will the insurer pay?

Living Benefit

The Accelerated Death Benefit provision in a life insurance policy is also known as a(n):

the premiums are based on a younger age

The advantage of reinstating an original life policy is

Premiums are waived if payor becomes disabled

What benefit does the Payor clause on a Juvenile Life policy provide?

at future dates specified in the contract with no evidence of insurability required

When does a Guaranteed Insurability Rider allow the insured to buy additional coverage?

When the insured dies or at the policy's maturity date, whichever happens first

When is the face amount of a whole life policy paid?

Payor clause

Which of the following provisions guarantees that premiums will be waived if a Juvenile Life policyowner becomes disabled?

Reinstatement

Which of these provisions require proof of insurability after a policy has lapsed?

Evidence of insurability is required when the option is exercised

Which of these statements about a Guaranteed Insurability Option rider is NOT TRUE?

variable life

Which of these types of life insurance allows the policyowner to have level premiums and also choose from a selection of investment options?

Decreasing Term

Which of these types of policies may NOT have the Automatic Premium Loan provision attached to it?

Variable Universal Life

Which type of life policy contains a monthly mortality charge as well as self-directed investment choices?