Life Insurance - Chapter 6: Life Policy Riders

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

Monthly premium waiver and monthly income

What best describes the effect the Accelerated Benefit provision would have on the benefits paid to the beneficiary?

It will decrease the benefits paid to the beneficiary because of the early payment given if the insured becomes terminally ill or confined to a long-term care facility.

Which statement is true concerning the Accidental Death Rider

It will pay double or triple the face amount if death is the result of an accident and occurs within 90 days of such an accident

Which rider added to a life insurance policy can pay part of the death benefit to the insured to cover expenses incurred in a nursing or convalescent home?

Long-term care

A rider that may be attached to a life insurance policy that will adjust the face amount based upon a specific index, such as the Consumer Price Index, is called

Cost of living rider

What is the purpose of annuity riders?

To allow investors to obtain additional benefit not offered with the original annuity product

Which annuity riders ensures that the owner will receive from an annuity at least the amount paid for the annuity

Guaranteed Lifetime Withdrawal = protects annuity owners from losing their investments if the annuity value drops

All of these topics may be included in the continuing education requirement for long-term care insurance

-Alternatives to the purchase of private long-term care insurance -The effect of inflation in eroding the value of benefits and the importance of inflation protection -Available long-term care services and facilities

These are responsibilities of every long-term care insurer in California

-Establish marketing procedures to assure that any comparison of policies will be fair and accurate -Establish marketing procedures to assure excessive insurance is not sold or issued -Submit to Commissioner a list of agents authorized to solicit consumers for the sale of long-term care insurance

What is the minimum number of hours of continuing education for long-term care insurance needed to complete for license renewal

8 hours annually for 4 years, and 8 hours every 2 years thereafter

At the time the insured purchased her life insurance policy, she added a rider that will allow her to purchase additional insurance in the future without having to prove insurability. This rider is called

Guaranteed insurability

An individual is purchasing a permanent life insurance policy with a face value of $25,000. While this is all the insurance that he can afford at this time, he wants to be sure that additional coverage will be available in the future. Which of the following options should be included in the policy?

Guaranteed insurability option

If a life policy allows the policyowner to make periodic additions to the face amount at standard rates, without proving insurability, the policy includes a

Guaranteed insurability rider