Chapter 3
Under which of the following circumstances would an insurer pay accelerated benefits?
An insured is diagnosed with cancer and needs help paying for her medical treatment
Which nonforfeiture option has the highest amount of insurance protection?
Extended term
What is the purpose of a fixed-period settlement option?
To provide a guaranteed income for a certain amount of time
The paid up addition option uses the dividend
To purchase a smaller amount of the same type of insurance as the original policy.
The paid-addition option uses the dividend
To purchase a smaller amount of the same type of insurance as the original policy.
The type of settlement option which pays throughout the lifetimes of two or more beneficiaries is called
Joint and survivor
Which of the following information will be stated in the consideration clause of a life insurance policy
The amount of premium payment
What is the purpose of a fixed period on a waiver of premium rider in life insurance policies?
6 months
What is the advantage of reinstating a policy instead of applying for a new one?
The original age is used for premium determination
An insured and his wife are both involved in a head-on collision. The husband dies instantly, and the wife dies 15 days later. The company pays the death benefit to the estate of the insured. This indicates that the life insurance policy had what provision?
Common Disaster
When the policyowner specifies a dollar amount in which installments are to be paid, he/she has chosen which settlement option?
Fixed amount
Which of the following allows the insurer to receive a minor insured from premium payments if the minor's parents have died or become disabled?
Payor Benefits
Which of the following riders would NOT cause the death benefit to increase?
payor benefit rider
In a case where the primary beneficiary predeceases the insured, in the event of the insured's death, the death benefit proceeds will be paid to
The contingent beneficiary
The insured had his wife named as the beneficiary of his life insurance policy. To ensure that his wife had income for Iife after the insured's death, he chose the life income settlement option. The amount of payments will be determined by taking into account all of the following EXCEPT
The insured's age of death
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
Which of the following is true of a children's rider added to an insured's permanent life insurance policy?
It is term coverage that is convertible to permanent insurance at or prior to the child's reaching the maximum coverage age.
lf an insured continually uses the automatic premium loan option to pay the policy premium
The cash value will continue to increase
An insured purchased a 15-year level term life insurance policy with a face amount of $100,000. The policy contained an accidental death rider, offering a double indemnity benefit. The insured was severely injured in an auto accident, and after 10 weeks of hospitalization, died from the injuries. What amount would his beneficiary receive as a settlement?
200,000
