Types of Policies
A convertible term policy says conversion is available only under the policy's stated conversion provision. The owner asks for permanent coverage beyond the policy's allowed conversion amount without underwriting. What is the best response?
Answer and explanation
Answer: D. A conversion privilege lets eligible term coverage be exchanged for permanent coverage under the policy's stated conditions. It does not create an unlimited right to additional permanent coverage beyond those conditions.Source: New York Department of Financial Services — Consumer Life Insurance FAQ — Term Life Insurance > convertible term; conversion during the specified period
More types of policies questions
- Which premium characteristic defines traditional straight ordinary whole life insurance?
- Who bears the investment risk for policy cash values held in a variable whole life policy's separate account?
- Why is the premium for a $1,000,000 survivorship life policy lower than for a $1,000,000 joint first-to-die policy on the same two lives?
- A 20-year level term policy allows conversion only during the first 10 policy years and renewal only until age 65. In policy year 9 the insured wants permanent coverage without risking later evidence-of-insurability problems. Which advice best protects the contractual right?
- A 20-year term policy allows conversion only during its first 12 years. What happens to the conversion privilege after year 12?
- A 20-year term policy permits conversion only during its first 12 years. Which statement correctly describes the feature?
590 Texas questions like this one.
Every answer explained, the ones you miss come back on a spaced schedule, and a plan built from your exam date.