LIFE INSURANCE POLICY PROVISIONS, OPTIONS AND RIDERS

4) Which of the following terms refers to the transfer Of some or all of the ownership rights of a life insurance policy from one individual to another?

Assignment

11) Which of the following statement is true of both the fixed period and fixed amount settlement options?

Both Guarantee that the Principal and Interest will be fully paid out.

13) Which of the following is a characteristic of a revocable beneficiary designation?

Policy owner can change beneficiary designation anytime without consent of beneficiary.

9) All the following are nonforfeiture options in life insurance policies EXCEPT

Automatic Premium Loans

6) A spouse receives $5,000 a month until the principle and interest on her husbands life insurance policy have been paid out. Which settlement option did this beneficiary choose?

Fixed Amount

2) A life insurance policy clause that prevents an insurance company from denying payment of a death after a specified period of time is known as the

Incontestability Clause

5) Which of the following is true about the mandatory free look period in life insurance policy.

It commences when the policy is delivered

8) The insured pay $1,200 annually for her life insurance premium. This year, she has accumulated $175 worth of dividends, which she applies to her next premium, thus reducing it to $1,025. What dividend option has the insured chosen?

Reduction Of Premium

3) When a death claim is submitted, the insurer discovered that the insured understate her age on the application for a life policy. What action will the insurer take?

Pay a reduced death benefit based on the insured's actual age.

12) Which of the following is not a standard exclusion in life insurance policies?

Disability

7) Which of the following features allows an insurance policy to remain in force for a specific number of days beyond the premium due date?

Grace Period Provision

1) Under what circumxtances will the contingent beneficiary recieve the death benefit?

If the primary beneficiary dies before the insured.

14) Because of an injury, an insured has been unable to work for 7 months. He wasn't able to pay his life insurance policy premium, yet the policy remained in force. The policy includes

Waiver of Premium Rider

10) In order to reinstate a life insurance policy the insured must do all of the following EXCEPT

Pay next Years Premium in Advance

15) All of the following are true regarding the guaranteed insurability rider EXCEPT

It is available automatically, for no extra premium.