Policy provisions, options and riders

What provision in a life insurance policy states that the application is considered part of the contract?

Entire contract provision

Which of these statements about a guaranteed insurability option rider is not true?

Evidence of insurability is required when the option is exercised

D is the policy owner and insured for a 50,000 life insurance policy. The beneficiary is D's wife . if D dies without making any further changes, To whom will the policy proceeds be paid to?

Ex-wife

And insured is past due on his life insurance premium, but is still within the grace period. What will the beneficiary receive if the insured dies during this grace period?

Full face amount minus any past due premiums

All of the statements about the waiver of premium provision are correct, except

Insured must be eligible for Social Security disability for claim to be excepted

The accidental death and dismemberment provision in a life insurance policy would pay additional benefits if the insured

Is blinded in an accident

Which of the following are not an example of a nonforfeiture option?

Life income

S buys a $10,000 whole life policy in 2003 and pays an annual premium of $100. S dies 5 years later in 2008 and the insurer pays the beneficiary $10,500. What kind of rider did S include on the policy?

Return of premium rider

The Agreement in a life insurance contract that states a specific sum of money will be paid to a designated person upon an insured's death is called an

Insuring agreement

A potential client, age 40, would like to purchase a whole life policy that will accumulate cash value at a faster rate in the earlier years of the policy. Which of the statements made by the producer would be correct?

20 pay life accumulate cash value faster than straight life

L takes out a life insurance policy and dies 10 years later. During the claim process, the insurer discovers that L had understated her age on the application. Under the misstatement of age provision, the insurer will

Adjust the death benefit to a reduced amount

The consideration clause in a life insurance contract contains what pertinent information

Amount of premium payments and when they are due

What action will an insurer take if an interest payment on a policy loan is not made on time?

Automatically add the amount of interest due to the loan balance

The consideration clause in a life insurance policy indicates that a policyowner consideration consists of a completed application and

The initial premium

When a misrepresentation on a life insurance policy application is discovered,what action may an insurance company take?

Void the policy only if it is discovered during the contestable period and proven to be material.

A life insurance policy which ensures that the premium will be paid if the insured becomes disabled has what kind of rider attached?

Waiver of premium

N is covered by a term life policy and does not make the required premium payment which was due august 1. N dies September 15. What action will the insurer take?

Claim will be denied

How do Iife insurance companies handle cases where the insured commit suicide within the contracts stated Contestable period

Claims are denied under the suicide clause of the policy

The Incontestable clause allows an insurer to

Contest a claim during the contestable period

How are policy owner dividends treated in regards to income tax?

Interest on accumulations is taxed

All of the settlement options involves the systematic liquidation of the death proceeds in the event of the insurance death, except

Interest only

An insured and ability to perform two or more activities of daily living may trigger which type of policy rider?

Long-term care

A young,Married teacher has two children and owns a whole life policy. If the teacher wants an increasing death benefit to protect against inflation, the teacher should select which of the following dividends options?

Paid up additional insurance

Which rider provides coverage for a child under a parent life insurance policy

Child term rider

Which of these types of policies may not have the automatic premium loan provision attached to it?

Decreasing term