Policy Options Flashcards
A policy owner surrenders a whole life policy for a reduced paid-up policy. What will happen to the cash value policy?
it continues to increase
The insured pays $1,200 annually for her life insurance premium. This year she has accumulated $175 worth of dividends which she applies to her next premium payment resulting in a payment of $1025. Which dividend option has she chosen?
Reduction of premium
All the following are non forfeiture options EXCEPT
One-year Term
Which settlement option offers an unchanging benefit payment until all proceeds are paid
Fixed Amount
If a policy owner borrows funds from the cash value of their policy and does not pay back the loan amount, how will a claim on the death benefit be paid?
The death benefit paid to the beneficiary will be less the loan amount plus interest
Which non forfeiture option allows for the purchase of a policy with a lower face amount that will continue to build cash value
Reduced Paid-up
An insured may receive any of the following from a universal life insurance policy and keep it in force EXCEPT for
Cash surrender value
Which dividend option allows for the purchase of additional permanent insurance?
Paid-up additional
Which non forfeiture option maintains the original face amount of the policy but sacrifices the length of the contract?
Extended Term
Which of the following settlement options would provide a beneficiary with the largest monthly income from a life insurance death?
Life income
