Types of Policies
A renewable term policy states that renewal rights end at a specified age. The insured reaches that age and wants another term. Which statement is most accurate?
Answer and explanation
Answer: C. A renewable term contract may limit renewal rights at a specified age, so renewability does not necessarily continue for life. The feature does not require free permanent coverage, and a beneficiary cannot rewrite the policy’s renewal limit.Source: NAIC — Life Insurance Buyer’s Guide — PDF page 5, Renewable Term vs. Nonrenewable Term — possible loss of renewal right at a stated age
More types of policies questions
- A policyowner surrenders a 20-year return-of-premium term policy in year 5 and expects the full end-of-term refund. What is the best response?
- A policyowner’s income varies and the owner wants to adjust premium timing within policy limits while keeping permanent coverage. Which product feature most directly addresses that need?
- A prospect wants permanent insurance with adjustable policy elements and cash value allocated to insurer-managed separate-account investments. Which product is the best fit?
- A prospect wants permanent life insurance, wants to choose among stock and bond investment options, and accepts possible cash-value loss. Which product best fits?
- A retiree hands an insurer a single premium and wants income payments to start about one month later. Which annuity fits?
- A retiree makes one annuity purchase payment and wants income payments to begin within the next year. Which classification applies?
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.