6 Questions
What is the primary obligation of the insurer in an insurance contract?
To pay benefits in accordance with the terms of the contract
What does the joint and 2/3 survivor settlement option mean for the beneficiaries?
The beneficiary receives 2/3 of the benefit amount after the death of the other beneficiary
What is the purpose of a free-look period in insurance policies?
To allow the insured to review and understand the policy terms
What type of settlement option pays throughout the lifetimes of two or more beneficiaries?
Joint Life
What happens to the life insurance premiums if the father becomes disabled and has a Payor Benefit rider?
The premiums will be waived until the daughter is 21
What can the insurance company do if they discover that the insured concealed information during the application process?
Refuse to pay the death benefit
Study Notes
Insurance Policy Components
- An insured pays an annual premium to their insurer, and in return, the insurer promises to pay benefits according to the contract terms.
Policy Provisions
- The company's promise to pay is contained in the policy components.
Settlement Options
- A joint and 2/3 survivor settlement option means the surviving beneficiary will continue receiving 2/3 of the benefit paid when both beneficiaries were alive.
- The type of settlement option that pays throughout the lifetimes of two or more beneficiaries is called a life income option.
Free-Look Period
- The purpose of a free-look period is to provide a guaranteed income for a certain amount of time.
Policy Riders
- A Payor Benefit rider waives the life insurance premiums if the policyholder (in this case, the father) becomes disabled until the insured (daughter) reaches a certain age (21).
Misrepresentation in Applications
- If the insured conceals information during the application process, the insurance company can decline to pay the death benefit.
Test your knowledge of insurance policy fundamentals, including contract terms, premium payments, and benefit promises. Learn about the components of an insurance policy and how they work together. Evaluate your understanding of insurance contracts and terminology.
Make Your Own Quizzes and Flashcards
Convert your notes into interactive study material.
Get started for free
