Quiz 4

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

When a policy owner designates a group of individuals as the beneficiary of a life insurance death benefit without specifically naming the individuals, this is called

Class designation

A long stretch of national economic hardship causes a 7% rate of inflation. A policyowner notices that the face value of her life insurance policy has been raised 7% as a result. Which policy caused this change?

Cost of living rider

The automatic premium loan provision is activated at the end of the

Grace period

An insured purchased a life insurance policy on his life naming his wife as primary beneficiary, and his daughter as contingent beneficiary. under what circumstances could the daughter collect the death benefit? a. If the primary beneficiary predeceased the insured b. When the insured dies, the primary and contingent beneficiaries share death benefits equally c. With the primary beneficiary's written consent d.If the insured dies from accidental means

IF the primary beneficiary predeceased the insured

Which of the following applies to the 10-day free-look privilege?

It permits the insured to return the policy for a full refund of premiums paid

A couple owns a life insurance policy with a Childrens term rider. Their daughter is reaching a maximum age of dependent coverage, so she will have to convert to permanent insurance in the near future. Which of the following will she need to provide for proof of insurability.

Proof of insurability is not required

When an insured under a life insurance policy dies, the designated beneficiary received the face amount of the policy, as well as a refund of all the premiums paid. Which rider is attached to the policy?

Return of premium

Which nonforfeiture option has the highest amount of insurance protection?

The extended term

What advantage of reinstating a policy instead of applying for a new one?

The original age is used for premium determination

The paid-up addition option uses the dividend

To purchase a smaller amount of the same type of insurance as the original policy.

The waiver of cost of insurance rifer is found in what type of insurance

Universal life

After a back injury, an insured is disabled for a year. His insurance policy carries a Disability Income Benefit rider. Which of the following benefits will he receive?

monthly premium waiver and monthly income

An absolute assignment is a

transfer of all ownership rights in a policy