Types of Policies
An insured outlives a return-of-premium term policy, and no death benefit was paid. What feature may then apply according to the contract?
Answer and explanation
Answer: C. Return-of-premium term may refund part or all of the premiums when the insured outlives the term and no death benefit was paid. It does not automatically buy securities, annuitize the face amount, or provide free permanent insurance.Source: NAIC — Life Insurance — Term Life Insurance > Return of Premium (ROP)
More types of policies questions
- 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?
- What feature of a Market Value Adjusted (MVA) annuity alters early surrender values based on interest rate shifts?
- What happens if a universal life policy's cash value is insufficient to cover monthly mortality and administrative deductions?
- What happens to the cash value in a decreasing term life policy as the face amount approaches zero?
- What happens to the cost of an increasing term benefit as the insured ages and the coverage amount rises?
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.