Chapter three quiz
If an insured with drawls a portion of the face amount in the form of accelerated benefits because of a terminally illness, how will that affect the payable death benefit from the policy?
The death benefit will be smaller
The accelerated benefits provision will provide for an early payment of the death benefit when the insured
Becomes terminally ill
It's a beneficiary wants a guarantee that benefits paid from the principal and interest would be paid for a period of 10 years before being exhausted, White settlement option should the beneficiary select?
Fixed period
All of the following are nonforfeiture options except
Interest only
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 that the principal will be paid to their children when they reach a certain age. Which settlement option should the policy owner choose?
Interest only option
Which of the following is true about the mandatory free look in a life insurance policy?
It commences when the policy is delivered
Which of the following statements is true concerning the accidental death rider?
It will pay double or triple the face amount
Which of the following is true about nonforfeiture values?
They are required by state law to be included in the policy
Why it would be an advantage to naming a contingent, or secondary, beneficiary on a life insurance policy?
Determined to receives the policy benefits if the primary beneficiary is deceased
When the policy owner specifies a dollar amount in which installments or to be paid, he/she has chosen which settlement option?
Fixed amount
What is the purpose of a free look period in insurance policies?
It allows the insured to reject the policy with a full refund.
Which of the following riders added to a life insurance policy can pay part of the death benefit to the insurance to cover expenses incurred in a nursing or convesalent home?
Long term care
If a settlement option is not chosen by the policy owner or the beneficiary, which option will be used?
Lump some
A rider attached to a life insurance policy that provides coverage on the insurance family members is called the
Other insured rider
And insured has had a life insurance policy that he purchased three years ago when he was 40 years old. He is killed in an automobile accident, and it is discovered that he is actually 45 years old, and not 43, as stated on the application. What will the company do?
Pay a reduced death benefit
Which of the following allows the insurer to relieve a minor insured from premium payments if the minors parents have died or become disabled?
Payor benefit
Which of the following riders would not cause the death benefit to increase?
Peor benefit rider
Which nonforfeiture option provides a coverage for the longest period of time?
Reduced paid up
The policy owner pays for her life insurance annually. Until now, she has collected a nontaxable dividend check each year. She has decided that she would rather use the dividends to help pay for her next premium. What option would allow her to do this?
Reduction of premium
Which of the following information will be stated in the consideration clause of a life insurance policy?
The amount of premium payment
If an insured withdraws a portion of the face amount in the form of accelerated benefits because of a terminal illness, how will that affect the payable death benefit from the policy?
The death benefit will be smaller
A father owns a life insurance policy on his 15-year-old daughter. The policy contains the option Peor benefit rider. If the father becomes disabled, what will happen to the life insurance premiums?
The insurance premiums will be waived until she is 21
What is the wedding. On a waiver of premium rider in life insurance policies?
Six months
An insured hand a $10,000 term life policy. The annual premium of $200 would do on February 1; however the insured failed to pay the premium. He died on February 28. How much would a beneficiary receive from the policy?
$9800
A father purchases a life insurance policy on his teenage daughter and Aunt at the Peor benefit rider. In which of the following scenarios will the writer waive the payment of premium?
If the father is disabled for more than six months
Which of the following policy component contains the companies promise to pay?
Insuring clause
A policy owner who is the insured wants to name her husband as the beneficiary of her life policy. She also wishes to retain all of the rights of ownership. The policy owner should have her has been named as the
Revocable beneficiary
Under an extended term nonforfeiture option, the policy cash value is converted to
The same face amount as in the whole life policy
The automatic premium loan provision is activated at the end of the
Grace period
Which is true about the cash surrender nonforfeiture option
Fun succeeding the premium paid or taxable as ordinary income
