Life Provisions

Question 1

The automatic premium loan provision can be accurately described as a

Answer 1

provision that provides a policy loan to pay any premiums by the end of the grace period

Question 2

A life insurance guaranteed insurability rider gives the insured the right, without providing insurability, to

Answer 2

Periodically purchase additional insurance

Question 3

What happens to a life insurance policy when the policy loan balance exceeds the cash value?

Answer 3

Policy will no longer be in force

Question 4

Which benefit is normally payable to a life insurance policyowner when the insured’s life expectancy has been severely limited?

Answer 4

Accelerated (living) benefit

Question 5

An insured has a $25,000 whole life insurance policy with $6,000 cash value available. Under the extended term nonforfeiture option, what is the amount of insurance available to the insured?

Answer 5

$25,000

Question 6

A policyowner has a life insurance policy where she had listed her age on the application as 5 years younger than her actual age. If she dies and the insurer discovers the misstatement of age, how much will the insurance company pay?

Answer 6

Less than the face amount

Question 7

Which statement regarding the waiver of premium rider is accurate?

Answer 7

Cash payment is not directly provided to the policyowner

Question 8

Which life insurance policy option allows the policyowner to have coverage equal to the net death benefit of the lapsed policy?

Answer 8

Extended term nonforfeiture option