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Questions and Answers
Which of the following is NOT part of an insurance contract?
Which of the following is NOT part of an insurance contract?
- Certificate of Authority (correct)
- Exclusions
- Premium Payment
- Insurance Policy
Life insurance policies will normally pay for losses arising from
Life insurance policies will normally pay for losses arising from
- Commercial aviation (correct)
- Certain pre-existing conditions
- Acts of war
- Suicide within two years
If an insured's age on a life insurance policy has been misstated, what is the insurer's liability if the insured dies?
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?
What will a double indemnity benefit payable to Matt's beneficiary if Matt dies instantly from a car accident?
The common disaster provision states the insurer will continue as if what?
The common disaster provision states the insurer will continue as if what?
All of these are common exclusions to a life insurance policy EXCEPT:
All of these are common exclusions to a life insurance policy EXCEPT:
What is an insurance policy's grace period?
What is an insurance policy's grace period?
Which type of rider will waive the premium on a child's life insurance policy if the parent paying the premium dies?
Which type of rider will waive the premium on a child's life insurance policy if the parent paying the premium dies?
What is the name of the provision which states that a copy of the application must be attached to the policy when issued?
What is the name of the provision which states that a copy of the application must be attached to the policy when issued?
Which of these is considered to be a Living Benefit option in a life insurance policy?
Which of these is considered to be a Living Benefit option in a life insurance policy?
The free-look provision gives the policyowner what?
The free-look provision gives the policyowner what?
A whole life insurance policy accumulates cash value that becomes what?
A whole life insurance policy accumulates cash value that becomes what?
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?
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?
Which of these is NOT a characteristic of the Accelerated Death Benefit option?
Which of these is NOT a characteristic of the Accelerated Death Benefit option?
Which of the following is a reinstatement condition?
Which of the following is a reinstatement condition?
Which of the following is considered to be an alternative to a life settlement?
Which of the following is considered to be an alternative to a life settlement?
Which dividend option would an insurer invest the policyowner's money and add any interest earnings as the dividends accrue?
Which dividend option would an insurer invest the policyowner's money and add any interest earnings as the dividends accrue?
What military service exclusion clause would pay upon Kurt's death?
What military service exclusion clause would pay upon Kurt's death?
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?
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?
Barbara's policy includes a rider which allows her to purchase additional insurance without evidence of insurability. What is this called?
Barbara's policy includes a rider which allows her to purchase additional insurance without evidence of insurability. What is this called?
Loans obtained by a policyowner against the cash value of a life insurance policy would not be treated as what?
Loans obtained by a policyowner against the cash value of a life insurance policy would not be treated as what?
Which of these is NOT considered to be a nonforfeiture option in a whole life insurance policy?
Which of these is NOT considered to be a nonforfeiture option in a whole life insurance policy?
What is an endorsement found in an insurance plan which modifies the provisions of the policy called?
What is an endorsement found in an insurance plan which modifies the provisions of the policy called?
In what part of an insurance policy are policy benefits found?
In what part of an insurance policy are policy benefits found?
When Dorian used his life policy's cash value to purchase an extended term insurance option, what happens when the term insurance expires?
When Dorian used his life policy's cash value to purchase an extended term insurance option, what happens when the term insurance expires?
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.
