Quiz: Riders Covering Additional Insureds

All the following statements about "other insured" term riders on a life insurance policy are correct EXCEPT: A. Only spouses or partners can be covered under this rider. B. Coverage ends when the policyowner reaches a specified age such as 65 or 70. C. The term life coverage provided by the rider is temporary. D. Applicants often purchase this rider to cover their spouse or partner.

A. Only spouses or partners can be covered under this rider. While spouses and partners are most commonly covered, another insured rider can be purchased on any adult with whom the policyowner (who is usually the insured) has an insurable interest.

Under a family term rider to a life insurance policy, children who are covered under the rider can typically convert their coverage to permanent coverage as early as: A. age 25, without having to provide evidence of insurability B. age 21, without having to provide evidence of insurability C. age 21, as long as evidence of insurability is provided D. age 25, as long as evidence of insurability is provided

B. age 21, without having to provide evidence of insurability

The amount of coverage provided by a children's term life rider is usually: A. any amount the policyowner wishes B. limited to a modest flat dollar amount or a small percentage of the base policy's face amount C. limited to the base policy's face amount D. equal to the base policy's cash value

B. limited to a modest flat dollar amount or a small percentage of the base policy's face amount Reflecting the rider's intent, children's term rider coverage is usually limited to a modest specified amount (e.g., $5,000 or $10,000) and/or a percentage of the base policy's face amount (e.g., 10 percent).

Which statement about converting coverage under a children's term rider is correct? A. Conversion is possible only if the child is insurable and is limited to the amount provided under the rider. B. Conversion is possible only if the child is insurable, and the converted policy coverage amount may be greater than the amount provided under the rider. C. Conversion is possible even if the child is uninsurable and is limited to the amount provided under the rider. D. Conversion is possible even if the child is uninsurable, and the converted policy coverage amount may be greater than the amount provided under the rider.

D. Conversion is possible even if the child is uninsurable, and the converted policy coverage amount may be greater than the amount provided under the rider. The child can convert the coverage to any permanent life insurance policy the insurer is then issuing without proof of insurability; the conversion coverage may be greater than the rider coverage.