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Questions and Answers
Past-due interest on a policy loan is added to the total debt.
Past-due interest on a policy loan is added to the total debt.
True
How much will D's beneficiary receive from a $100,000 Whole Life policy with a War Exclusion clause if D was killed while on leave?
How much will D's beneficiary receive from a $100,000 Whole Life policy with a War Exclusion clause if D was killed while on leave?
The full face amount
An insured's inability to perform two or more activities of daily living may trigger which type of policy rider?
An insured's inability to perform two or more activities of daily living may trigger which type of policy rider?
Long term care
All of these statements concerning Settlement Options are true EXCEPT:
All of these statements concerning Settlement Options are true EXCEPT:
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How do life insurance companies handle cases where the insured commits suicide within the contract's stated Contestable period?
How do life insurance companies handle cases where the insured commits suicide within the contract's stated Contestable period?
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What action will an insurer take if an interest payment on a policy loan is not made on time?
What action will an insurer take if an interest payment on a policy loan is not made on time?
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Additional coverage can be added to a Whole Life policy by adding which rider?
Additional coverage can be added to a Whole Life policy by adding which rider?
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What provision in a life insurance policy states that the application is considered part of the contract?
What provision in a life insurance policy states that the application is considered part of the contract?
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What is the purpose of the Suicide provision in a life insurance policy?
What is the purpose of the Suicide provision in a life insurance policy?
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If D's ex-wife is the beneficiary of a $50,000 life insurance policy and D transfers ownership to his new wife, who will the policy proceeds be paid to if D dies?
If D's ex-wife is the beneficiary of a $50,000 life insurance policy and D transfers ownership to his new wife, who will the policy proceeds be paid to if D dies?
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Which type of life insurance allows the policyowner to have level premiums and choose from a selection of investment options?
Which type of life insurance allows the policyowner to have level premiums and choose from a selection of investment options?
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Which life insurance rider typically appears on a Juvenile life insurance policy?
Which life insurance rider typically appears on a Juvenile life insurance policy?
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What is the purpose of the automatic premium loan provision in life insurance policies?
What is the purpose of the automatic premium loan provision in life insurance policies?
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In a life insurance policy, what feature states that the policy will not cover certain risks?
In a life insurance policy, what feature states that the policy will not cover certain risks?
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When does a Guaranteed Insurability Rider allow the insured to buy additional coverage?
When does a Guaranteed Insurability Rider allow the insured to buy additional coverage?
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If S buys a $50,000 whole life policy with a $50,000 Accidental Death and Dismemberment rider and dies one year later of natural causes, how much will the insurer pay the beneficiary?
If S buys a $50,000 whole life policy with a $50,000 Accidental Death and Dismemberment rider and dies one year later of natural causes, how much will the insurer pay the beneficiary?
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A young, married teacher wants an increasing Death Benefit to protect against inflation. What Dividend Option should the teacher select?
A young, married teacher wants an increasing Death Benefit to protect against inflation. What Dividend Option should the teacher select?
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Study Notes
Life Insurance Policy Provisions and Options
- Policy loans require that past-due interest is added to the total debt.
- A War Exclusion clause in a Whole Life policy does not affect the payout if the insured is killed in an automobile accident while on leave.
- Long term care riders are triggered by the insured's inability to perform two or more activities of daily living.
- Settlement Options can be selected by the policyowner, not solely by the beneficiary.
- Life insurance claims for suicides within the contestable period are denied based on the Suicide clause.
- If a policy loan's interest payment is missed, the insurer will add the unpaid interest to the loan balance.
- A decreasing term rider can be added for additional coverage on a Whole Life policy.
- The Entire Contract provision states that the policy, application, and any riders make up the entire agreement.
- The Suicide provision is designed to protect insurers from applicants considering suicide.
- In the case of divorce, the ex-spouse remains the beneficiary unless officially changed, even with ownership transfer.
- Variable Life insurance offers level premiums while allowing policyowners investment options.
- The Payor Benefit rider on Juvenile policies waives premiums if the adult-payor dies or becomes disabled.
- The Waiver of Premium provision does not require eligibility for Social Security disability for claims—this is incorrect.
- The automatic premium loan provision helps prevent lapses in coverage on a policy.
- Exclusions in a policy refer to specific risks that the insurance will not cover.
- The Guaranteed Insurability Rider allows buying additional coverage specified in the contract without proof of insurability.
- If insured with an Accidental Death rider dies from natural causes, the full policy payout is made ($50,000).
- To protect against inflation with an increasing Death Benefit, choosing Paid-Up Additional Insurance as a Dividend Option is advisable.
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Description
Test your knowledge on life insurance policies, including their provisions, options, and riders. These flashcards cover key concepts such as policy loans and exclusivity clauses, preparing you for exam success in this critical area of insurance knowledge.
