Types of Policies
An annually renewable term policy is renewed for another year. What happens to the premium and to the evidence of insurability?
Answer and explanation
Answer: A. Annually renewable term gives the owner a contractual right to renew for another one-year term without proving insurability. Because the insured is a year older, the renewal premium is higher.Source: NAIC Life Insurance Buyer's Guide — Term insurance: renewable term and attained-age premiums
More types of policies questions
- Under IRC § 7702 corridor rules, what must an insurer do if cash value growth in a universal life policy threatens to breach the statutory life insurance definition ratio?
- What benchmark rate is used in variable annuity payout calculations to determine whether monthly annuity payment amounts increase or decrease?
- What benefit does a joint and survivor annuity payout option provide to two annuitants (such as a married couple)?
- What characterizes a deferred annuity contract during its accumulation phase?
- What defines the death benefit and premium structure of a standard level term life policy?
- What external measure is commonly used to determine interest credits in indexed universal life?
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