Insurance Premiums and Underwriting Guidelines
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Insurance Premiums and Underwriting Guidelines

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Questions and Answers

What happens to the policy if total debt becomes higher than the Cash Surrender Value?

  • The policy can be reinstated without conditions.
  • The policy is automatically renewed.
  • The policy will automatically terminate. (correct)
  • The policy will remain active with all benefits.

    • What is the grace period for premium payments before a policy lapses?

  • 90 days
  • 15 days
  • 31 days (correct)
  • 60 days

    • Which condition allows for the reinstatement of a lapsed policy?

  • The policy must be surrendered for Cash Surrender Value.
  • The insured must not be insurable according to company rules.
  • No debts related to the policy are allowed.
  • All back premiums must be paid with interest. (correct)

    • What benefit ends if the policy lapses due to non-payment of premiums?

    <p>All benefits except those under the Non-Forfeiture Option</p> Signup and view all the answers

    Under what circumstances will a reinstated policy cover events?

    <p>Only events after the approval of the reinstatement.</p> Signup and view all the answers

    What is the maximum personal accident benefit for individuals aged 18-65?

    <p>₱ 50,000,000</p> Signup and view all the answers

    What is the waiting period for the Enhanced Waiver of Premium (EWP) rider benefit to take effect?

    <p>90 days</p> Signup and view all the answers

    Which payment terms are available for the Base Plan?

    <p>5 years and 10 years only</p> Signup and view all the answers

    What happens to the premiums in the event of Total and Permanent Disability under the Enhanced Waiver of Premium?

    <p>Both Base and Rider premiums are waived</p> Signup and view all the answers

    What type of cash surrender value is associated with the riders?

    <p>No cash surrender value</p> Signup and view all the answers

    Which age group is eligible for the Enhanced Waiver of Premium rider benefit?

    <p>18-45 only</p> Signup and view all the answers

    What is the purpose of the Payor’s Benefit on Death and Disability (PBDD) rider?

    <p>Waives premiums in case of death or disability of the payor</p> Signup and view all the answers

    Is the Vitality Integration applicable to the rider benefits?

    <p>No, it is not applicable</p> Signup and view all the answers

    What is the latest age up to which an individual can be insured under the base plan?

    <p>65</p> Signup and view all the answers

    Which payment term allows the insured to pay for the longest duration?

    <p>10 years</p> Signup and view all the answers

    What is the maximum face amount available under the insurance plan?

    <p>₱ 75,000,000</p> Signup and view all the answers

    Which of the following occupations are exempt from obtaining the Total and Permanent Disability (TPD) rider?

    <p>Military personnel</p> Signup and view all the answers

    What type of premium structure is followed by the insurance plan?

    <p>Level Premium</p> Signup and view all the answers

    What is the premium payment period in relation to the basic plan?

    <p>It follows the pay-period of the basic plan</p> Signup and view all the answers

    What benefit does the insurance plan not provide?

    <p>Rider Cash Surrender Value</p> Signup and view all the answers

    Which statement regarding Vitality Integrated plans is correct?

    <p>It is applicable if the base plan is vitality integrated.</p> Signup and view all the answers

    What is the death benefit payable for any event except suicide whilst sane?

    <p>Payor’s Term Benefit plus policy debt</p> Signup and view all the answers

    What happens to the Payor’s Term Benefit rider if the payor dies from suicide within 2 years of the effective date?

    <p>It is terminated</p> Signup and view all the answers

    What defines total and permanent disability for claims?

    <p>Inability to perform 3 or more activities from the 6 Activities of Daily Living</p> Signup and view all the answers

    What must happen after a claim for a total and permanent disability benefit is approved?

    <p>The TPD rider must be terminated</p> Signup and view all the answers

    If a payor dies by suicide whilst sane, what is the benefit payable?

    <p>Payor’s Term Benefit premium minus debts</p> Signup and view all the answers

    Which of the following is true regarding the policy status after claims under the death benefit?

    <p>The policy remains in force</p> Signup and view all the answers

    What is required for an insured to qualify for total and permanent disability benefits?

    <p>Inability to perform 3 or more of the 6 Activities of Daily Living due to bodily injury or disease</p> Signup and view all the answers

    What occurs to the death benefit when the payor has outstanding debt to the company?

    <p>The benefit is reduced by the amount of outstanding debt</p> Signup and view all the answers

    What is the primary purpose of the grace period in insurance policies?

    <p>To give policyholders extra time to pay their premiums without losing coverage</p> Signup and view all the answers

    Which of these best describes non-forfeiture options?

    <p>Options that allow the policy to be surrendered for its cash value</p> Signup and view all the answers

    In the context of insurance, what does the underwriting approach primarily focus on?

    <p>Evaluating an applicant's risk to determine coverage eligibility</p> Signup and view all the answers

    What is a critical feature of policy loans in insurance?

    <p>They cannot exceed the total paid premiums</p> Signup and view all the answers

    Which of the following best describes the free-look period?

    <p>A duration within which a policy can be returned for a full refund</p> Signup and view all the answers

    What does lapsation refer to in insurance?

    <p>The expiration of coverage due to non-payment of premiums</p> Signup and view all the answers

    What information is critical in an application form for insurance?

    <p>Medical history and occupational details</p> Signup and view all the answers

    What is renewability in insurance policies primarily concerned with?

    <p>The ability to extend coverage beyond the original term</p> Signup and view all the answers

    Which statement is true regarding contractual policy changes?

    <p>They require mutual agreement and documentation</p> Signup and view all the answers

    What do dividend options in an insurance policy usually provide?

    <p>Flexibility to receive payouts or apply to premiums</p> Signup and view all the answers

    Study Notes

    Premium and Payments

    • Premium and Payments:
      • Currency: The text does not specify what currency is used.
      • Pay Period: The pay period is not specified in the text.
      • Minimum Premium: P 100,000
      • Maximum Premium: P 75,000,000
      • Mode of Payment: Not specified.
      • Method of Payment: Not specified.
      • Policy Fee: Not specified.
      • Grace Period: 31 Days

    New Business, Underwriting, and Processing Guidelines

    • Application form: Standard application form is used.
    • Sales Illustration: A sales illustration is provided.
    • Underwriting Approach and Guidelines:
      • Underwriting Net Amount at Risk: The text does not provide details on underwriting net amount at risk.
      • Medical and Occupational Ratings: The text does not provide specific medical and occupational ratings.
    • Free-Look Period: The period is not specified in the text.

    Policy Owner Services

    • Non-Forfeiture Options: Not specified in the text.
    • Dividend Options: Not specified.
    • Policy Loans:
      • If the total debt exceeds the Cash Value, the policy will lapse.
      • Policy will terminate if the balance exceeds the Cash Surrender Value.
    • Renewability: Not applicable.
    • Convertibility: Not applicable.
    • Lapsation:
      • If premiums are not paid by the end of the grace period, the policy will lapse.
      • All benefits, except those under the Non-Forfeiture Option, will end.
    • Reinstatement:
      • The policy can be reinstated within 3 years from the date of lapse.
      • The policy must not have been surrendered for Cash Surrender Value.
      • The insured must be insurable according to company rules.
      • All back premiums must be paid with interest, or any debt must be paid or resumed.
      • Any reinstated policy will only cover events occurring after the reinstatement date, subject to the contestability of the policy.

    Issue Age and Coverage

    • Base Plan Coverage Period: Up to age 65
    • Payment Terms:
      • 5 years to pay
      • 10 years to pay
    • Insured Issue Age: 18-45
    • Rider Benefit Term: Up to policy maturity or age 65 of the insured, whichever comes first.

    Occupations Exempted from Total and Permanent Disability (TPD) Rider

    • Allotee, Homemaker
    • Minor
    • Pensioner, Retiree
    • Student (not aviation, marine, or military)
    • New Graduate

    Riders

    • All Personal Accident (PA) Benefits Per Life

      • Issue Age: 18-65
      • Maximum Benefit: ₱ 50,000,000
      • Premium Structure: Level premium (will follow the pay-period of the Basic Plan).
      • Rider Cash Surrender Value: None.
      • Vitality Integration: Applicable if Base Plan is vitality integrated.

    • Enhanced Waiver of Premium (EWP)

      • Waives both base and rider premiums in case of TPD or diagnosis of any covered Critical Illness (CI).
      • Issue Age: 18-45
      • Payment Terms:
        • 5 years to pay
        • 10 years to pay
      • Premium Structure: Level premium (will follow the pay-period of the Basic Plan).
      • Rider Cash Surrender Value: None.
      • Vitality Integration: Not applicable.
      • Waiting period: 90 days from policy effective date.

    • Payor's Benefit on Death and Disability (PBDD)

      • Waives the total premium (Base and rider) in case of death or TPD of the Payor/Policy Owner.
      • Policy will terminate if total debt becomes higher than the Cash Surrender Value.
      • Renewability: Not applicable.
      • Convertibility: Not applicable.
      • Lapsation:
        • If premiums are not paid by the end of the grace period, the policy will lapse.
        • All benefits, except those under the Non-Forfeiture Option, will end.

    Benefits Payable

    • Death of the Payor/Policy Owner

      • Any event except suicide while sane: Death Benefit = Payor's Term Benefit (PTB) Face Amount less any debt to the company.
      • Suicide while sane within 2 years from the effective date: Death Benefit = Payor's Term Benefit (PTB) Premium less any debt to the company.

    • Total and Permanent Disability (TPD) Claims

      • Insured gets TPD due to bodily injury or disease and cannot perform 3 or more activities from the 6 Activities of Daily Living: TPD Benefit = 100% of the TPD Face Amount.

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    Description

    This quiz covers essential topics related to insurance premiums, payment methods, and underwriting guidelines. It explores minimum and maximum premium amounts, grace periods, application forms, and policy owner services. Test your understanding of the key elements in these insurance processes.

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