Chapter 14 Flashcards
Define a straight life annuity annuitized payout option ?
Payments continue for the lifetime of the annuitant and cease at the annuitants death
Define a joint and survivor life annuity payout option
payments are made to two or more annuitants; continue for the lifetime of the last surviving annuitant and cease at the death of the last surviving annuitant
define a life annuity with period certain payout options
payments continue for the lifetime of the annuitant or for a certain period specified int he contract (which ever is loner) - there is usually a contingent payee for a remaining balance if applicable.
Define a life with refund annuity payout option
payments continue for the lifetime of the annuitant. If they die before the payee recieves payments that total at least the purchase price of the anniuty contract, the insurer refunds to the payee the difference between the purchase price and the amount paid out
Define a structured settlement
a settlement of a civil dispute or lawsuit in which a party agrees to make periodic payemnts to a specified payee for a specified period of time.
Standard claim procedures for require most insurers to perform which 5 tasks?
- determine whether the policy is in force
- Verify the identity of the insured
- verify that a loss has occured
- varify that the loss is covered by the policy
- verify the identity of the beneficiary.
Name some examples of practices that are typically deemed to be unfair claim practices
- intentionally misrepresenting important facts about insurance coverage
- failing to provide request claim forms within a stated time (15 days)
- failing to respond prompty to communications about unpaid claims
- faling to develop proper g/l for the timely investigations of claims
- failing to render prompt decision about the payment or denial of a claim after an investigation is complete
What is typically accepted as proof of claim?
most require a death certificate
APS-
There are time limitations for paying valid claims. What are they for
- canada
- hong kong
- philippines
- united states
- 30 daays
- ASAP
- 60 days
- 30 days
What is the simultaneous death act
if the insured and beneficiary die at the same time or under circumstances that make it impossible to determine which of them died first, the insured is deemed to have surviced the beneficiary, and policy proceeds are payable as though the insured outlive the beneficiary unless the policy provides otherwise.
What is a survivorship clause?
it requires the beneficiary to survive the insured by a stated period of time, usually 30-60 days, to be entitled to receive the policy proceeds.
When computing the amount payable of a claim, what may increase the amount of death benefit payable?
- accidental death benefits
- accumulated policy dividends
- unpaid policy dividends
- paid-up additional insurance benefits
- unearned premium paid in advance
When computing the aount payable of a claim, what may decrease the amount of death benefit payable?
- unpaid policy loans
- accrued policy loan interest
- premiums due and unpaid at the time of the insures death
most policies contain exclusions. What are these?
provisions that specify certain situations under which the insurer will not pay the policy’s face amount.
state the war exclusion provision
an insurer will not pay the full policy proceeds if an insured’s death is caused by war-related activities.
State the aviation exclusion provision.
states than an insurer will not pay the policy face amount if the insured’s death is caused by certain aviation related- activities.
State the suicide exclusion provision.
The insurer will not pay the policy face amount if the insured dies as a results of suicide within a stated period of time after the date that the policy was issued. usually 2 years. But they will return the premiums
Most states require a claimant to prove which 4 facts, when an insured’s disapperance cannot be attibuted to an identifiable cause?
- the insured has been missing continuoously for a specified period of time (5-7 yrs)
- insured’s absence is unexplained
- a reasonable search for the insured has taken place
- no one has had communicaiton with the insured since his disappearance.
What is a rebuttable presumption?
a presumption that can be disproven but that stands until adequate evidence is presented to the contrary.
define an accidental death benefit
A supplemental life insurance policy benefit that requires the insurer to pay a specified amount of money in addition to the policy’s basic death benefit if an insured dies as a results of an accident.
What is the definition of an accidental death
death resulting directly and independently of all other causes, from accidental bodily injury.
What is a time limitation clause?
a clause that specifies that the insured’s death must occur within a certain period of time- usually 90 days- from the date of an accident for accidental death benefits to be payable.
how do insurers typically handle claim litigations./
this can be very expensive so insurers try to avoid this by reaching a compromise with the potential plaintifs,
what is a compromise settlement?
An agreement between two or more parties to settle a dispute regarding the terms and/or performance of a contract.
What starts a litigation?
it begins when an insurer denies a claim for a life insurance proceeds.
what is a choice of laws provision?
When parties mutually agree on to which jurisdiction laws will govern their contract.
what happens when a policy does not include a choice of laws provision in their contract?
Typically the law is followed under the jurisdiction in which the last contract act was made.
What are the last acts necessary to complete the formation of a life insurance contract?
- payment of the initial premium
2. delivery of the policy to the policy owner.
what is meant by the benefit of the bargain?
the amount that would put the plaintiff in the financial position he would have been in had the contract been performed.
