Policy provisions – Lesson 4 Flashcards
A benefit of a policy loan is it that no interest is charged. True or false?
False
The entire contract is considered to be:
The policy, attached application and any attached riders.
Any assignment of a policy must be approved by the insurer. True or false?
False
A man wanted his 3 children to receive the proceeds from his policy. If a child predeceases him, he wanted only the remaining children to receive the proceeds. This is called:
Per capita
If Mary is named as an irrevocable beneficiary on her aunts life policy, can she take out a loan on the policy?
Yes, but only with her aunt’s permission
What happens to the proceeds from a policy if the beneficiary died before the policyowner and the policyowner did not name a new beneficiary?
The proceeds are paid to the policy owner’s estate.
What happens when proceeds of a life insurance policy are paid into the estate of the insured?
It is subject to administrative delays and expenses.
The insured and the primary beneficiary are killed as a result of the same accident. What clause will assure that the contingent beneficiary will receive the proceeds?
Uniform simultaneous death act.
What is the main purpose of the short-term survivorship clause?
To preserve the amounts the contingent beneficiary would collect from the policy.
In insurance, which party has the right to name a beneficiary, use the cash values, and paid a premium?
Policyowner
What part of an insurance contract states under what conditions a policy will not pay a death claim?
Exclusions
In insurance, what is the entire contract?
The policy and the attached application.
A provision of the policy that describes how and when a benefit will be paid is the?
Insuring clause
The policy conditions represent the obligations of:
Both the insured and insurer.
If the policy is issued and if return within the specified time allotted, the insured will receive a 100% refund. True or false?
True
What is the effect of the incontestable clause on a life insurance policy?
It prevents the insurer from voiding the contract on grounds of misrepresentation, concealment, or fraud on the part of the insured if he dies after the period stated in the policy.
If the insurer finds that the insured’s age was misstated on the application after the insured dies, what will the insured do?
Pay the beneficiary the face amount equal to that which the premium would have purchased at the correct age.
When would a policy no longer be in force and not provide coverage?
After the grace period has expired.
How may a life insurance policy be reinstated within time limits after it has lapsed due to nonpayment of premiums?
By paying past due premiums plus interest as well as submitting an application and evidence of insurability.
If the insured commits suicide within the time specified by the suicide clause, the insurance company may do what?
- Prove that death was by suicide.
- Return premiums to beneficiary.
- Refuse to pay any benefits.
In California the free look period is how long?
10 days (20 if replacements is involved)
The title page in the policy is also referred to as what?
Data page
Life policies are referred to as:
Valued policies
Starting 1995, the free look for senior citizens age 60 and older was changed to how many days?
30 days
