Chapter 3

Which of the following is true about a class designation?

Beneficiaries are not identified by name

The provision which states that both the policy and a copy of the application, form the contract between the policy owner, and the insured is called

Entire contract

Which nonforfeiture option is the highest amount of insurance protection

Extended term

An individual purchase a life insurance policy on his life naming his wife, has primary beneficiary, and their daughter as contingent beneficiary. Under what circumstances but the daughter collect the benefit.

If the primary beneficiary predecease the insured

The policy owner wants to make sure that upon his death, the life policy will pay a portion of the proceeds annually to his spouse, but the principal will be paid to their children when they reach a certain age. Which settlement option to the policy owner choose.

Interest only option

What is the benefit of choosing extended term as a nonforfeiture option

It has the highest amount of insurance protection

Which of the following statements is true about a policy assignment?

It transfers rights of ownership from the owner to another person.

If it's settlement, option is not chosen by the policy, owner or the beneficiary, which option will be used

Lump sum

Is there a class designation for beneficiary means

Naming beneficiaries as a group

Which of the following information will be stated in the consideration clause for life insurance policy

The amount of premium payment

All the following are true statements regarding the accumulation at Insurance interest option, except

The interest is not taxable since it remains inside the insurance policy

The paid-up addition option uses the dividend

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