Exam 12: Life Insurance Contractual Provisions

If a life insurance policy lapses for nonpayment of premiums,and the policyholder has not elected another option,which nonforfeiture option usually goes into effect in most policies?

Disadvantages of life insurance settlement options include which of the following? I.Higher yields can often be obtained elsewhere. II.Life income options have limited usefulness at younger ages.

A dividend option that allows the policyholder to purchase 1-year term insurance is referred to as the

Which of the following statements is (are)true regarding exclusions in life insurance contracts? I.Life insurance policies are remarkably restrictive,including numerous exclusions. II.A life insurer may exclude death attributable to certain activities or hobbies disclosed on the application.

Which of the following statements about the entire contract clause is true?

Beth purchased a participating life insurance policy 6 years ago.Her life insurance needs have increased,but she has developed a medical condition that makes it impossible for her to purchase more life insurance at affordable premiums.Which dividend option makes sense for Beth to use given her medical condition?

Which of the following statements about nonforfeiture options found in life insurance policies is true?

Which of the following statements about accelerated death benefits riders is (are)true? I.Under a terminal illness rider,after a partial payment is made to the insured,there is a reduction in the face amount of insurance,cash value,and premiums. II.Benefits under a long-term care rider are for home health care only.

Which of the following statements about the change of plan provision in a life insurance contract is (are)true? I.A change to a lower premium policy results in a refund of the difference in the cash values of the two policies. II.A change to a higher premium policy requires evidence of insurability.

Cal purchased a whole life policy 6 years ago.The policy requires annual premium payments.Cal forgot to pay the premium that was due 2 weeks ago.He wonders if his life insurance is still in force.Which life insurance policy provision is designed to keep the policy in force for a short time even if the premium payment is late?

Which of the following statements about life insurance settlement options is true?

Which of the following statements about life insurance policy loans is (are)true? I.Interest is not required on a life insurance policy loan,as the policyholder is borrowing his or her own money. II.If there is an outstanding loan when the insured dies,payment to the beneficiary is reduced by the amount of the loan.

The practice of buying the life insurance policy of a terminally ill insured at a discount is referred to as a

Tim purchased a 10-payment whole life insurance policy 15 years ago.Tim would like to donate this paid-up policy to a charity.Under which policy provision can Tim transfer all ownership rights in the policy to the charity?

Which of the following statements about the guaranteed purchase option is true?

Bert purchased a life insurance policy 4 years ago.He inadvertently stated that he was 1 year younger than his actual age.If Bert dies today,how much will the insurance company pay?