Policy Riders, Provisions, Options, and Exclusions
A beneficiary selects a straight life-income settlement. Which tradeoff is most important?
Answer and explanation
Answer: B. A straight life-income option pays while the beneficiary lives. A long lifetime may yield payments exceeding the original proceeds, while early death can result in fewer total payments unless a period-certain or refund feature applies.Source: Texas Department of Insurance — Life Insurance Guide — How life insurance pays the death benefit > Life refund and lifetime payments
More policy riders, provisions, options, and exclusions questions
- When an increasing term rider is added to a whole life policy to provide a return-of-premium death benefit, what does the total benefit equal at death?
- When does the free-look period for a newly delivered life insurance policy begin?
- When is a contingent beneficiary generally next in line to receive life insurance proceeds?
- Where is the insurer's fundamental obligation to pay the death benefit upon receipt of proof of death set forth?
- Which beneficiary designation generally allows the owner to make a change without the beneficiary's consent?
- Which description best identifies the coverage supplied by a term rider?
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