Chapter 6 &7 Flashcards
Three options are available to policy owners who decides to surrender a whole life policy, the policy owner can stop paying premiums and he will not forfeit the cash value or equity that has built up in the policy.
Non forfeiture options( cash value must be present)
What are the three non forfeiture options
Surrender for cash, extended level term insurance, reduced paid up premium insurance.
allows the policy owner to return or send the policy back in return for its cash saving value.
Surrender for Cash
allows the policy owner to surrender the whole life in exchange for a level term plan with the same face amount
Extended Level Term Insurance
The cash value will be identical to the face amount of the surrender whole life policy
Extended Level Term Insurance
Provides the insured with the most life insurance protection in the event of voluntary or none premium payment
Extended Level Term Insurance
Policy allows the policy owner to surrender the policy and use the cash value to buy a smaller or reduced amount of permeant paid up life insurance.
Reduced Paid up permeant insurance
What are some ways policy owners can receive dividends
CASH, Reduced Premiums, Accumulate at interest , Paid up permeant additions , paid up options, one year term.
Which of the following policy options allows a policy owner effectuate a single premium purchase.
Reduced Premium Payments
All the following are dividend options EXCEPT
Reduced paid Up Options
Which of the following non - forfeiture option provides the greatest amount of protection
Extended Term insurance
The policy owner exercises a paid up additions dividend option the amount coverage purchase will based upon the insured attained age and
The amount of the dividend
Use Dividend to purchase additional whole life insurance
Paid up additions
Informs insure to return dividend to a designated account
Accumulate interest
Dividend Used to simply purchase any type of term insurance that the insurer offers
One year term
Return the Dividend and subtract the amount from the premium
Reduced Premium
Insure will send Dividend directly to the insured
Cash
Which of the following settlement options pays a specified monthly income for as long as the policy proceeds plus interest last
Fixed Amount
A rider that pays an increasing amount of term insurance equal to the amount of total payments made for coverage, in addition to the death benefit at the time of death, is known as
Return of Premium
Benefit of 1% of the face value of the policy which payable if the insured is totally disabled. Income benefits begin after the six month waiting period.
Disability Income benefit Rider
If the insured becomes disabled for six consecutive months, the insurer promises to waive ant future premium payments. Until he or she returns to work.
Waiver Of Premium
Which none forfeiture option is automatically exercised if a policy lapse with current cash value and the insurer is unable to contact the policy owner
Surrender For Cash
A rider that permits a the policy owner to purchase additional life insurance without tak9ng a physical examination best describes
Guaranteed Insurability Rider
If a whole life policy premium is not paid by the end of the contract grace period and the policy contains several thousand dollars of equity, what policy option will protect the insured against a coverage lapse
Non forfeiture benefit
