Policy Riders, Provisions, Options, and Exclusions
An elected automatic premium loan provision is triggered, but available cash surrender value is less than the required loan plus interest. Which limitation applies?
Answer and explanation
Answer: A. Automatic premium loan protection depends on sufficient policy value. NY DFS explains that cash surrender value must at least equal the loan amount plus the required interest; otherwise the provision cannot fund the full loan.Source: New York State Department of Financial Services — Life Insurance Information for Consumers — Optional Riders & Supplemental Benefits > Automatic Premium Loan Provision
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