Individual life insurance contract - provisions and options

When the insured Celexa extended term non-forfeiture option, the cash value will be used to purchase term insurance with what face amount?

Equal to the original policy for as long as the cash value will purchase. With this option the cash value is used as a single premium to purchase the same face amount as original policy for a long period of time as a cash will buy at the insured's current age.

What nonforfeiture option has its highest amount of insurance protection?

Extended Term. The extended term non-forfeiture option has the same face amount as original policy, but for a shorter period of time.

When the policy owner specifies a dollar amount in which installments are to be paid, she/he has chosen which settlement option?

Fixed amount. When the fixed amount settlement option is chosen, the policy only sets the amount of each installment. Then sure will determine how long installments are to be paid.

All of the following are dividend options except?

Fixed period installments. Fixed period installments option is not one of the dividend options.

The automatic premium loan provision is activate at the end of the...

Grace-Period. provided there is a sufficient cash value in the policy, the provision triggers alone at the end of the grace period to keep a policy in force.

Life income joint and survival settlement option guarantees...

Income for two or more recipients until they die. The life income joint and survivor option guarantees an income for two or more recipients for the duration of their lives. Most contacts stipulate that the surviving partner will receive a reduced payment after the other dies, although some will continue to pay the same amount. There is no guarantee that all the life insurance proceeds will be paid out.

When a whole life policy lapses or is surrendered prior to maturity, the cash value can be used to..

Purchase a single premium policy for reduced face amount. When a whole life policy lapses or is surrendered prior to maturity, the cash rally can be used by the insurer as a single premium to purchase a completely paid up permanent policy that has reduced face amount from that of a former policy.

Which is not true about the beneficiary designations?

The beneficiary must have insurable interest in the insured. A beneficiary is a person or interest to whom the policy proceeds will be paid upon the death of the insured. Beneficiaries do not have to have an insurable interest in the policyholder.

If an insured under available life insurance policy dies, how will ensure respond to outstanding policy loans?

The loan amounts are deducted from the death benefit. In the event and insured dies, any outstanding policy loans and a cured interest is deducted from the policy proceeds. Loans cannot exceed the cash value of the policy.

And insured stops making payments on the loan taken from his cache Valley policy. What will most likely happen?

The policy will terminate when the loan amount with interest equals or exceeds cash value. In most policies, failure to pay back a loan will result in termination of the policy if the total amount of a loan and accured interest equals the cash value

How long will the beneficiary receive payments under a single life settlement option?

Until the beneficiary's death. The single life option can provide a single beneficiary income for the rest of his/her life. Upon the death of the beneficiary, the payment stop.

What is the name of the clause that is included in a policy that limits or illuminates the death benefit of the insured dies as a result of war or while serving in the military?

War or military service. There are two types of exclusions that may be used by life insurance and limit the death benefit if the insured dies as a result of war or while serving in the military. Status clause excludes all causes of death while the insured is on active duty in the military. The results clause is only excludes the death benefit if the insured is killed as a result of an act of war.