Chapter 10
How long is the grace period in group policies?
31 days
According to the state nonforfeiture law for life insurance policies, insurers must offer at least one of the following nonforfeiture options EXCEPT
Reduction of premium
Viatical settlements may be rescinding within what time period after the viator receives the proceeds?
15 days
All of the following statements are correct regarding credit life insurance EXCEPT
Benefits are paid to the borrower's beneficiary.
Which of the following must be included in all life insurance advertisements?
Identity of the actual insurer
The initial amount of credit life insurance may NOT exceed
The amount to be repaid under the contract
Which of the following is NOT required on an illustration used in the sale of a life insurance policy?
The name of the primary and secondary beneficiaries
Is it illegal for an insurance company to advertise that it is the leader of the financial industry and therefore pays the most claims each year?
Yes; advertisements must not mislead the public in terms of financial standing.
Which of the following would be the beneficiary in credit life insurance?
creditor
The usage of words or symbols that are similar to what entity is prohibited in life insurance advertisements?
federal government
Which of the following types of insurance policies is most commonly used in credit life insurance?
Decreasing term Credit insurance is a special type of coverage written to insure the life of the debtor and pay off the balance of a loan in the event of the death of the debtor. It is usually written as decreasing term insurance.
When possible, what should insurers strive to eliminate from illustrations?
Footnotes and caveats
What is the main purpose of the regulation on life insurance policy illustrations?
To help the public make educated decisions about buying life insurance
Which of the following CANNOT be included along with illustrations used to sell life insurance?
Vanishing premium information