E and F are business partners. C) Pay full benefits as stated in the policy Proceeds can be administered by the insurance company All of the following are nonforfeiture options, EXCEPT: a. f. Service Revenue. The insured partys coverage can be terminated automatically when the policyholder fails to make premium payments or when he/she surrenders the policy. Elaine was diagnosed with a terminal illness. Depending on the age of the policy, the cash surrender value could be less than theactual cash value. D) Allows the insured to convert a term life policy to whole life with no evidence of insurability, B) Purchase additional coverage with no evidence of insurability required, Loans obtained by a policyowner against the cash value of a life insurance policy, A) are treated as taxable income Which type of life policy contains a monthly mortality charge as well as self-directed investment choices? A lower face amount than the whole life policy. A person may have a vested interest in property to be forfeit in two ways: In personum jurisdiction and in rem jurisdiction. In permanent life insurance policies, if you fail to pay the premiums in the grace period, you won't lose your life insurance. B) Waiver of premium rider This provision is the, All of the following are nonforfeiture options EXCEPT. C) accident B owns a Whole Life policy with a guaranteed insurability option that allows him to purchase, without evidence of insurability, stated amounts of, additional Whole Life coverage at specified times. Consider consulting a financial advisor who can guide you on choosing an option that will best fit your circumstances. Past-due interest payments not paid after 3 months will void the policy C) Premium increase B) the beneficiary outlived the insured A) 12/15th of the policys face amount The amount of cash value you will have built-in your policy will be reduced by the amount of any loans against your life insurance. C) Incontestability D) Certificate of Authority, All of these are valid policy dividend options for a life insurance policyowner EXCEPT, A) cash outlay to the policyowner D) Reinstatement, A whole life policy option where extended term insurance is selected is called a(n), A) dividend option Which of the following statements is (are) true regarding life insurance policyholder dividends? A) The policy may be paid up early by using accumulated cash values S dies 1 year later of natural causes. Nonforfeiture Benefits for Life Insurance | Life Benefits Which of these is considered to be a Living Benefit option in a life insurance policy? Chapter 4- Policy Provisions, Options and Riders (Exam 2) A) Grace period If the consumer price index has gone up 4%, how much may Ron increase the face value of the policy? S dies 5 years later in 2008 and the insurer pays the beneficiary $10,500. Extended-term insurance allows a policyholderto stop paying the premiums, but not forfeit the equity of theirpolicy. However, surrendering a portion of the cash value reduces thedeath benefit. The Consideration clause in a life insurance contract contains what pertinent information? D) Period of time after the premium is due but the policy remains in force, D) Period of time after the premium is due but the policy remains in force, All of these are common exclusions to a life insurance policy EXCEPT, A) accidental death C) nonforfeiture option. D) buy additional insurance coverage, All of the following are considered to be nonforfeiture options available to a policyowner EXCEPT, A) Extended Term Insurance Financial Modeling & Valuation Analyst (FMVA), Commercial Banking & Credit Analyst (CBCA), Capital Markets & Securities Analyst (CMSA), Certified Business Intelligence & Data Analyst (BIDA), Financial Planning & Wealth Management (FPWM). Insurance companies can send delinquent interest accounts to a collection agency What is the purpose for having an accelerated death benefit on a life insurance policy? ? B) the death benefit D) Grace period provision. b) The key employee has premiums deducted from his salary. Her doctor said that her only chance of survival is an experimental treatment. Bruce is involved in an accident and becomes totally and permanently disabled. d) Alzheimer's disease While normally mental and nervous disorders or disease are excluded in long-term care policies, Alzheimer's disease is not. What provision can Sheila add to her policy to address this concern? A) Reduce premium A) Cancel the policy Which of these is considered to be a Living Benefit option in a life insurance policy? D) Mike has the option of using his cash value to purchase a reduced amount of paid-up whole life insurance, D) Mike has the option of using his cash value to purchase a reduced amount of paid-up whole life insurance. The treatment is expensive and is not covered by Elaine's health insurance. What time period allows an insureds life insurance policy to remain in force even if the premium was not paid on the due date? Rapid depletion of proceeds can be avoided A criminal conviction is required for civil forfeiture. Are you having trouble answering the question All of the following are nonforfeiture options, EXCEPT:? S would like to use dividends from her life insurance policy to purchase paid-up additions. A provision that allows a policyowner to temporarily give up ownership rights to secure a loan is called a Pat owns a 20-pay life policy with a paid-up dividend option. James is the insured on a life insurance policy where his age was misstated on the application. C) are limited by the face amount of the policy Which of these life insurance riders allows the applicant to have excess coverage? One type of life insurance is a nonparticipating whole life policy in which cash values are based on the insurer's present mortality, investment, and expense experience. She can reestablish coverage under which of the following provisions? \text { Note Payable (due 2022) } & & 50,000 \\ For traditional whole-life policies, the policyholder decides how they would like to access the policys cash value. 90 percent of forfeiture proceeds go to law enforcement, Law enforcement required to report forfeitures to the state auditor on a monthly basis, and the auditor must then make annual reports to the state Legislature. A waiver of premium rider allows an insured to waive premium payments if the insured is Life Insurance Policies - Provisions, Options, Fundamentals of Financial Management, Concise Edition, Ch 3 Section 3: L'chec scolaire: les lves. Jerry is an insured who understated his age on his life insurance application, paying $12 per $1,000 of insurance instead of $15 per $1,000. A) Accumulation at Interest Option She is concerned, however, that if she becomes disabled she will be unable to pay the premiums as they come due. You have the following unadjusted trial balance for Rogers Corporation at December 31, 2019: RogersCoprorationUnadjustedTrialBalanceDecember31,2019\begin{array}{c} While investigating the claim, the insurer discovered material misrepresentations made by P during the application process. B) Payor rider All of the following life insurance policies develop a cash value EXCEPT term life insurance. C) Annuity rider When the owner of whole-life insurance policy surrenders thepolicy, they have several nonforfeiture options. Quickly and professionally. The death benefit would be equal to the benefit in the original whole life insurance policy. Their purpose is to protect the insured's accumulated cash values in case the Whole Life or Endowment policy lapses. How Cash Value Builds in a Life Insurance Policy, Payout Options Under a Nonforfeiture Clause, Paid-Up Additional Insurance: Definition and the Role of Dividends, Life Insurance: What It Is, How It Works, and How To Buy a Policy, Whole Life Insurance Definition: How It Works, With Examples, Policy Loan: Definition, How They Work, Benefits, and Downsides. D) grace period. If an insureds age on a life insurance policy has been misstated, what is the insurers liability if the insured dies? Required fields are marked *, All of the following are considered to be nonforfeiture options available to a policyowner EXCEPT. Which of the following is the process of getting oxygen from the environment to the tissues of the body? C) the outstanding policy loan balance B) Waiver of premium When a policy is in force for a longer duration, the better the cash values and the nonforfeiture values. T took out a $50,000 life insurance policy with an Accidental Death and Dismemberment rider. \text { Accounts Payable } & & 9,400 \\ C) rider In what part of an insurance policy are policy benefits found? D) Cash dividend option. Which of the following is considered to be an alternative to a life settlement? Which military service exclusion clause would pay upon his death? \text { Rent Expense } & 229,000 & \\ Which rider provides coverage for a child under a parents life insurance policy? N dies September 15. automatically add the amount of interest due to the loan balance. B) Juvenile waiver Unpaid interest will be added to your loan amount and will be subject to compounding. c) The business is the owner and beneficiary of the policy. All of the following are considered to be nonforfeiture options available to a policyowner EXCEPT.
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