Chatper 3 QUIZ

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 policys cash value which is $20,000 what would the face amount be of the new term policy?

$50,000

Which of the following named beneficiaries would NOT be able to receive the death benefit directly from the insurer in the event of the insured's death?

A minor son of the insured

The automatic premium loan provision is activated at the end of the

Grace period

A father purchases a life insurance policy on his teenage daughter and adds the payor benefit rider. In which of the following scenarios will the rider waive the payment of premium?

If the father is disabled for more than 6 months

Life income joint and survivor settlement option guarantees

Income for 2 more recipients until they die

Which of the following policy components contains the company's promise to pay?

Insuring clause

What would be an advantage to naming a contingent (or secondary) beneficiary in a life insurance policy?

It determines who receives policy benefits if the primary beneficiary is deceased

After a back injury, an insured is disabled for a year. His insurance policy carries a Disability income benefit rider. Which of the following benefits will he receive?

Monthly premium waiver and monthly income

Which of the following explains the policyowner's right to change beneficiaries, choose options, and receive proceeds of a policy?

Owner's right

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

Methods used to pay the death benefits to a beneficiary upon the insured's death are called

Settlement options

According to the Entire contract provision, policy must contain

a copy of the original application for insurance

Which of the following is true about the premium on the children's rider in a life insurance policy?

it remains the same no matter how many children are added to the policy

Under an extended term nonforfeiture option, the policy cash value is converted to

the same face amount as in the whole life policy