Life Insurance Policy Provisions, Options, and Riders
When does a spendthrift clause stop protecting proceeds from the beneficiary's creditors?
Answer and explanation
Answer: B. The shield covers proceeds the insurer still holds, so money already paid to the beneficiary is ordinary property and open to creditors. Age, elapsed time and a change of administrator do not mark the boundary.Source: PSI — New York DFS Insurance Candidate Information Bulletin — Outline, spendthrift clause
More life insurance policy provisions, options, and riders questions
- A payee elects a life income with a ten year period certain and dies in the eighth year. What does the insurer do?
- A policy designates 'my children' as beneficiary and a child is born after the policy is issued. How is that child treated?
- A policyowner declines several offered cost of living increases in a row. What is the usual consequence under the rider?
- A policyowner exercises a long-term care rider on a life policy and receives benefits. What is the effect on the policy's death benefit?
- A policyowner's guaranteed insurability rider lists the birth of a child as an alternate option date. What may the owner generally do on that date?
- A producer describes a term rider added to a permanent life policy. Which statement avoids overstating what the rider provides?
621 New York questions like this one.
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