Policy Riders, Provisions, Options, and Exclusions
What must a policy do about the way death benefit proceeds are paid?
Answer and explanation
Answer: D. The uniform standards require the policy to describe how the death benefit proceeds are determined and to describe all death benefit options available under the policy. The choice is therefore disclosed in the contract rather than reserved to the insurer or forced on the beneficiary in advance.Source: Interstate Insurance Product Regulation Commission — Individual Term Life Insurance Policy Standards — Uniform standards, Death benefit and options
More policy riders, provisions, options, and exclusions questions
- Which premium mode results in the lowest total annual premium outlay for a life policy?
- Why do uniform product standards prescribe what a policy must describe?
- Why does consumer guidance advise against naming a minor child directly as beneficiary?
- Why does the ability to assign a life policy matter to an owner?
- Why is naming a minor child directly as a life insurance beneficiary problematic?
- Why might an owner prefer reinstating a lapsed policy over buying a new one?
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