Questions and Answers
Which of the following is NOT part of an insurance contract?
Life insurance policies will normally pay for losses arising from
If an insured's age on a life insurance policy has been misstated, what is the insurer's liability if the insured dies?
A prorated death benefit based on the amount of insurance the insured's premiums would have been if purchased at the correct age
What will a double indemnity benefit payable to Matt's beneficiary if Matt dies instantly from a car accident?
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The common disaster provision states the insurer will continue as if what?
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All of these are common exclusions to a life insurance policy EXCEPT:
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What is an insurance policy's grace period?
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Which type of rider will waive the premium on a child's life insurance policy if the parent paying the premium dies?
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What is the name of the provision which states that a copy of the application must be attached to the policy when issued?
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Which of these is considered to be a Living Benefit option in a life insurance policy?
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The free-look provision gives the policyowner what?
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A whole life insurance policy accumulates cash value that becomes what?
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The suicide clause of a life insurance policy states that if an insured commits suicide within a stated period, what will the insurer be liable for?
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Which of these is NOT a characteristic of the Accelerated Death Benefit option?
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Which of the following is a reinstatement condition?
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Which of the following is considered to be an alternative to a life settlement?
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Which dividend option would an insurer invest the policyowner's money and add any interest earnings as the dividends accrue?
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What military service exclusion clause would pay upon Kurt's death?
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What is the provision in a whole life policy that allows a policyowner to terminate the policy in return for a reduced paid-up policy of the same type called?
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Barbara's policy includes a rider which allows her to purchase additional insurance without evidence of insurability. What is this called?
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Loans obtained by a policyowner against the cash value of a life insurance policy would not be treated as what?
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Which of these is NOT considered to be a nonforfeiture option in a whole life insurance policy?
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What is an endorsement found in an insurance plan which modifies the provisions of the policy called?
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In what part of an insurance policy are policy benefits found?
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When Dorian used his life policy's cash value to purchase an extended term insurance option, what happens when the term insurance expires?
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Study Notes
Life Insurance Contract Components
- The Certificate of Authority is not included in an insurance contract.
- Common exclusions in life insurance typically include most risks except accidental death.
Life Insurance Policies and Coverage
- Life insurance policies cover losses from commercial aviation incidents.
- If an insured's age is misstated, the insurer pays a prorated death benefit based on the correct premium value at the accurate age.
Riders and Provisions
- A double indemnity rider provides additional benefits if the insured dies instantly from an accident, such as a car crash.
- The common disaster provision allows the insurer to treat the insured as having outlived the beneficiary if both die in the same accident.
- The payor benefit rider waives the premium on a child's policy if the parent paying the premium dies.
- The guaranteed insurability rider allows additional insurance purchase without evidence of insurability at designated times.
Policy Terms and Conditions
- The grace period is the time allowed after a premium is due before the policy lapses.
- The entire contract provision mandates that the application must be attached to the policy upon issue.
Living Benefits and Cash Value
- The accelerated death benefit is a living benefit option, allowing access to a portion of the death benefit while still alive.
- Whole life insurance has a cash value that can be borrowed against as a policy loan value.
Coverage Limitations and Reinstatement
- The suicide clause limits insurer liability to refunding premiums if suicide occurs within a set period after policy inception.
- Reinstatement of a policy typically requires proof of insurability.
Nonforfeiture Options
- Nonforfeiture provisions allow termination of a whole life policy for a reduced paid-up value.
- Nonforfeiture options do not include purely interest-only options.
Other Policy Elements
- Loans taken against a policy's cash value are generally not considered taxable income.
- Riders modify policy provisions with specific endorsements.
- Declarations section of a policy contains basic information relevant to the insured benefits.
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Description
Test your knowledge on Chapter 4 of life insurance provisions with this quiz. Focus on key concepts regarding insurance contracts and liabilities. Perfect for students preparing for exams in insurance studies.
