Texas Statutes and Rules Pertinent to Life Insurance Only
A Texas owner pays an annual premium and the insured dies four months into that policy year. What happens to the unearned premium?
Answer and explanation
Answer: C. Because premiums are paid in advance, part of the final annual premium covers a period after death. Whether it is refunded with the death benefit depends on the policy provision.Source: Texas Insurance Code — Tex. Ins. Code ch. 1101, premiums paid in advance and refunds
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