Policy Option
A policyowner surrenders a whole life policy for a reduced paid-up policy. What will happen to the cash value?
It continues to increase
All the following are nonforfeiture options EXCEPT
A)One-year term B) Cash surrender value C) Extended term D) Reduced paid-up insurance a
Which settlement option offers an unchanging amount of benefits until all proceeds are paid?
Fixed amount
Which divided option allows for the purchase of additional permanent insurance?
Paid-up additions
Which nonforfeiture option allows for insurance with a lower face amount but coverage that will remain the same as the original policy?
Reduced paid-up insurance
If a policyowner borrows funds from the cash value of her policy and does not pay back the loan amount, how will a claim on the death benefit be paid?
The death benefit paid to the beneficiary will be less the loan amount plus interest
The insured pays $1200 annually for her life insurance premium. This year, she has accumulated $175 worth of dividends, which she applies to her next premium payment which will be $1025. Which dividend option has she chosen?
Reduction of premium