Policy Riders, Provisions, Options, and Exclusions
A participating whole life owner wants to apply a declared dividend toward the next premium. Which dividend use matches that goal?
Answer and explanation
Answer: D. A declared dividend may commonly be taken in cash, added to policy value, or applied toward premiums. Applying it to the premium reduces the owner's out-of-pocket payment, subject to policy terms.Source: Texas Department of Insurance — Life Insurance Guide — Types of permanent life insurance > Whole-life insurance > dividend uses
More policy riders, provisions, options, and exclusions questions
- What standard requirements must a policyowner satisfy to reinstate a lapsed life insurance policy?
- 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?
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