Types of Policies
A term insured dies during the coverage period, and the insurer pays the death benefit. Under the usual return of premium condition, what result follows at the end of that term?
Answer and explanation
Answer: B. The usual return of premium feature refunds premiums at the end of the term only if no death benefit was paid during that period. Because the death benefit was paid, that condition is not satisfied.Source: New York State Department of Financial Services — Consumer Life Insurance FAQ — What is a Return of Premium feature?
More types of policies questions
- 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?
- 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?
- A return-of-premium term policy reaches the end of its stated term and the insured is alive. What does the policy pay and what happens to coverage?
- A term insured becomes uninsurable but wants permanent cash-value coverage during the policy’s conversion period. Which feature can meet that objective?
- A term policyowner exercises a renewal provision after the original term ends. What premium change should the owner generally expect?
590 Texas questions like this one.
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