life insurance Policy, Riders etc
Which of these is considered to be a Living Benefit option in a life insurance policy?
Accelerated death benefit
A life insurance policyowner was injured in an automobile accident which results in a total and permanent disability. Which rider would pay a monthly amount because of this disability?
Disability income rider
Which of these would limit a company's liability to provide insurance coverage?
Exclusion
Barbara's policy includes a rider which allows her to purchase additional insurance at specific dates or events without evidence of insurability. This rider is called a(n)
Guaranteed insurability rider
When does a life insurance policy's waiver of premium take effect?
Insured becomes totally disabled
Which of these is NOT considered to be a nonforfeiture option in a whole life insurance policy?
Interest only
What is an insurance policy's grace period?
Period of time after the premium is due but the policy remains in force
Which of the following is a reinstatement condition?
Proof of insurabiilty
A policyowner may exercise which of these dividend options that uses the dividend to pay all or part of the next premium due?
Reduction of premium dividend option
Pat owns a 20-pay life policy with a paid-up dividend option. Which of the following statements is true?
The policy may be paid up early by using policy dividends
When a life insurance policy is surrendered, how does the cost recovery rule apply?
The policy's cost basis is exempt from taxation
All of these are valid policy dividend options for a life insurance policyowner EXCEPT
accumulate without interest
An insured individual and the policy's beneficiary die from the same accident. The common disaster provision states the insurer will continue as if
the insured outlived the beneficiary
A whole life insurance policy accumulates cash value that becomes
the policy loan value which the insured may borrow against
If an insured dies during the grace period with no premiums paid
the policy would be payable, minus the premium amount
Dorian exercised a nonforfeiture option by using his life policy's cash value to purchase an extended term insurance option. When the term insurance expires,
the protection ends
Which dividend option would an insurer invest the policyowner's money and add any interest earnings as the dividends accrue?
Accumulation at Interest Option
Which of the following is NOT a common life insurance policy rider?
extended term
The suicide clause of a life insurance policy states that if an insured commits suicide within a stated period from the policy's inception, the insurer will only be liable for a return of premiums paid
minus indebtedness and without interest
A provision in a whole life policy that allows a policyowner to terminate the policy in return for a reduced paid-up policy of the same type is called a(n)
nonforfeiture provision
The free-look provision gives the policyowner
the right to return the policy for a full refund within a specified number of days
