Life Policy Riders, provisions, Options and Exclusions

A father owns a life insurance policy on his 15-year-old daughter. The policy contains the optional Payor Benefit rider. If the father becomes disables, what will happen to the life insurance premiums?

The insured's payments will be waived until she is 21

Which rider, when attached to a permanent life insurance policy, provides an amount of insurance on every family member?

Family term rider

All of the following are dividend options EXCEPT

Fixed-period installments

What provision in an insurance policy extends coverage beyond the premium due date?

Grace period

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

It transfers rights to ownership from the owner to another person

An insured committed suicide one year after his life insurance policy was issued. The insurer will

Refund the premiums paid

If a policy has an automatic premium loan provision, what happens if the insured dies before the loan is paid back?

The balance of the loan will be taken out of the death benefit

Which is true about a spouse term rider?

The rider is usually level term insurance

An insured owns a $50,000 whole life policy. At age 47, the insured decides to cancel his policy and exercise the extended term option for the policy's cash value, which is currently $20,000. What would be the face amount of the new term policy?

$50,000

Upon the death of the insured, the primary beneficiary discovers that the insured chose the interest only settlement option. What does this mean?

The beneficiary will only receive payments of the interest earned on the death benefit

If an insured withdraws a portion of the face amount in the form of accelerated benefits because of terminal illness, how will that affect the payable death benefit from the policy?

The death benefit will be smaller

A life insurance policy does not have a war clause. If the insured is killed during a time of war, what will the beneficiary receive from the policy?

The full death benefits

What is the purpose of a fixed-period settlement option?

To provide a guaranteed income for a certain amount of time

An insured has a life insurance policy from a participating company and receives quarterly dividends. He has instructed the company to apply the policy dividends to increase the death benefit. The dividend option that the insured has chosen is called

Paid-up addition

An insured has had a life insurance policy that he purchased 3 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