Compute SYXS_{Y X}SYX and interpret your findings Compute the MADM A DMAD and interpret your findings. D) the right to return the policy for a full refund within a specified number of days, D) the right to return the policy for a full refund within a specified number of days, The double indemnity provision in a life insurance policy pertains to an insureds death caused by a(n), A) sickness D) Premiums must continue to be paid. In personum actions are against the owner of property, whereas in rem actions are taken . Recent Examples on the Web This relatively unknown nonforfeiture option is called a life settlement. D) Grace period, All of these are standard exclusions found in a life insurance policy EXCEPT, A) hazardous occupations Extended-term insurance is often thedefault non-forfeiture option. The Consideration clause in a life insurance contract contains what pertinent information? Which of the following is CORRECT regarding the death benefit amount? XCEL Chapter 4 Part 2 Flashcards | Quizlet Your email address will not be published. a) Extended Term Insurance B) Extended term option D) hazardous occupations. All of the following are optional methods of settlement after the insured has died EXCEPT. D) war, An insured individual and the policys beneficiary die from the same accident. Are you looking for the correct answer to the question All of the following are considered to be nonforfeiture options available to a policyowner EXCEPT? \text { Wages Expense } & 137,000 & \\ T took out a $50,000 life insurance policy with an Accidental Death and Dismemberment rider. You dont have to worry about it anymore. What Is a Nonforfeiture Clause? 4 Payout Options Explained - Investopedia C) Covered hazard Life insurance policyholders can select one of four nonforfeiture benefit options: the cash surrender value, extended term insurance, loan value, and paid-up insurance. A) The agents obligation to provide the proper amount of coverage Learn how it works. D) It allows for a third party to purchase a life insurance policy at a discounted rate and immediately advance a portion of the death benefit, C) It allows for cash advances to be paid against the death benefit if the insured becomes terminally ill. A life insurance policy can be surrendered for its cash value under which policy provision? D) One-Year Term Dividend Option, A life insurance policyowner does NOT have the right to, A) change a beneficiary Instead, there are four options that the owner can choose from in order to access the accumulated cash value. suicide. d. What price range is your specialty? A provision that allows a policyowner to temporarily give up ownership rights to secure a loan is called a Pat owns a 20-pay life policy with a paid-up dividend option. C) Reinstatement period B) add-on Which situation accurately describes a reduced paid-up nonforfeiture option? A) Policy Feel free to get in touch with us via email. The nonforfeiture benefits clause allows the owner to choose full benefits or partial benefits when the premium can no longer be paid starting after a certain number of years. Ron joins the PPO provided by his employer. Mike buys a 10-year renewable term policy. D) Mike has the option of using his cash value to purchase a reduced amount of paid-up whole life insurance, D) Mike has the option of using his cash value to purchase a reduced amount of paid-up whole life insurance. Joanne has a $100,000 whole life policy with an accumulated $25,000 of cash value. Insurance companies can charge an interest rate based on the policyowners credit report, Past-due interest on a policy loan is added to the total debt. Which of these require an offer, acceptance, and consideration? from October 1 to December 31 is unpaid and unrecorded. Cash Value vs. A lower face amount than the whole life policy. An error was made on Marys life insurance application. Insured must be eligible for Social Security disability for claim to be accepted The Accelerated Death Benefit provision in a life insurance policy is also known as a(n), Which statement is TRUE in regards to a policy loan? A sub-agent cannot take or sign an application. What Is Charitable Gift of Life Insurance? Home Flashcards Chapter 4- Policy Provisions, Options and Riders (Exam 2), A waiver of premium rider allows an insured to waive premium payments if the insured is, A) temporarily disabled All of the following are standard life insurance policy nonforfeiture options EXCEPT: (A) cash surrender option(B) 1-year term insurance option(C) extended term insurance option(D) reduced paid-up (permanent) insurance option A (B) 1-year term insurance option 6 Q Which of the following statements best describes life insurance policy dividends? Which of these require an offer, acceptance, and consideration? A criminal conviction is required for civil forfeiture. Which dividend option would an insurer invest the policyowner's money and add any interest earnings as the dividends accrue? Which of these is considered to be a Living Benefit option in a life insurance policy? . How are surrender charges deducted in a life policy with a rear-end loaded provision? C) Paid-Up Additions Option C) Results C) Allows for a full refund after policy delivery Pat owns a 20-pay life policy with a paid-up dividend option. C) are limited by the face amount of the policy D) The original death benefit listed on the policy minus any outstanding loans and interest, C) A prorated death benefit based on the amount of insurance the insureds premiums would have been if purchased at the correct age. Chapter 8 Quiz Flashcards | Quizlet Which of the following statements is true? Under an extended term nonforfeiture option, the policy cash value is converted to The payable premium amount steadily declines throughout the duration of the contract. If the teacher wants an increasing Death Benefit to protect against inflation, the teacher should select which of the following Dividend Options? The same face amount as in the whole life policy. All of the following are dividend options EXCEPT: Fixed-period installments. In permanent life insurance, the policyholder will not lose the life insurance policy entirely. Interest only is a settlement option. D) is injured in a skiing accident and dies 18 months later. D) Income, A life insurance policy normally contains a provision that restricts coverage in the event of death under all of the following situations EXCEPT, A) fare-paying passenger B) dies of a stroke What is the name of the provision which states that a copy of the application must be attached to the policy when issued? Life Income, Which of the following Dividend options results in taxable income to the policyowner? b) Within 3 years. All of the following are considered to be nonforfeiture options available to a policyowner EXCEPT Options a) Extended Term Insurance b) Cash Surrender c) Reducation of Premium d) Reduced Paid-Up Insurance Answer: c) Reduction of Premium How much will Ds beneficiarys receive? fare-paying passenger. Depending on the age of the policy, the cash surrender value could be less than theactual cash value. The restaurant hires only male wait staff. D) Grace period. What will the beneficiary receive if the insured dies during this Grace Period? B) Decreases the policys cash value Both are in excellent health. All of these would be factors that determine how much coverage can be purchased EXCEPT C) the outstanding policy loan balance What is the name of the provision which states that a copy of the application must be attached to the policy when issued? D) Make a policy loan interest payment after the due date without any loss of coverage, B) Make a premium payment after the due date without any loss of coverage. Pay face amount minus the past due premium. D) Allows the insured to convert a term life policy to whole life with no evidence of insurability, B) Purchase additional coverage with no evidence of insurability required, Loans obtained by a policyowner against the cash value of a life insurance policy, A) are treated as taxable income $50,000 minus any outstanding policy loans. He forgot to pay the premium that was due last week. A Medicare Supplement policy must provide coverage for pre-existing conditions after the policy has been in force for a) 1 year b) 2 years c) 90 days d) 6 months. \hline \text { Cash } & \$ 3,100 & \\ B) Free look period Rapid depletion of proceeds can be avoided For some companies, this option may be automatic when surrendering a whole life insurance policy. C) policy and any verbal agreements Which type of beneficiary is changeable at any point? Which of these are NOT an example of a Nonforfeiture option? She is concerned, however, that if she becomes disabled she will be unable to pay the premiums as they come due. One of the questions on the application asks if P engages in scuba diving, to which P answers "No". Which of the following is a restatement condition? Suppose the first residual is 12.0(instead of 2.0 ) and the last residual is -11.0(instead of -1.0). If an insureds age on a life insurance policy has been misstated, what is the insurers liability if the insured dies? the policy may be paid up early by using policy dividends. During the claim process, the insurer discovers that L had understated her age on the application. B) Pay age-corrected benefits automatically add the amount of interest due to the loan balance. \text { Account } & \textbf { Debit } & \textbf { Credit } \\ Which nonforfeiture option has the highest amount of insurance protection? An insured is past due on his life insurance premium, but is still within the Grace Period. The agreement in a life insurance contract that states a specific sum of money will be paid to a designated person upon an insureds death is called a(n), Which of these is NOT considered to be a right given to a policyowner? Explain your reasons. B) Exclusion B) suicide The policy would retain a cash value component, but it would grow at a reduced rate. B) accumulate without interest "Standard nonforfeiture law for life insurance.". Who does the sub-agent represent? Set the qualitative parameters if the engine type is gasoline. The policyis calculatedfrom the insureds attained age. Unlike conventional loans, policy loans don't necessarily need to be paid back. C) Term life policies are the only type of insurance that allows policy loans Which of the following statements about accumulated interest earned on dividends from an insurance policy is TRUE? C) disability D) Cash dividend option. B) No interest will be charged on loan balance o paid - up additions extended term insurance . In most cases, the surrender cash value may be different from the cash value due to the policy owner. Let us have a look at your work and suggest how to improve it! D) Grace period provision. a. d) Revocable Revocable beneficiares can be changed at any point. B) unemployed \text { Other Assets } & 60,900 & \\ D) Mandatory provision, In order to activate the reinstatement clause of a lapsed life insurance policy, the insured MUST, A) remit all past-due premiums within the grace period B) Dividend option C) Riders Insurers require policyholders to have paid at least three years of premiums before they can be eligible for paid-up insurance. 3. There are no guarantees for the minimum amount of life insurance available in variable and universal life policies, which allow for variable investing. Which life policy is designed to provide the policyowner a hedge against the effects of inflation? We also reference original research from other reputable publishers where appropriate. C) all past premiums will be refunded with interest C) The policys premiums will increase after 20 years Which of the following statements is (are) true with respect to life insurance policy loans? Extended Term His $100,000 Whole life policy contains a War Exclusion clause. C) waiting period All of the following are nonforfeiture options, EXCEPT: a. Which nonforfeiture option has the highest amount of insurance protection? Fin 351 Flashcards | Chegg.com D) Nonforfeiture options. Buy extended insurance with accumulated cash value with no additional premiums required. When assessing a client with partial-thickness burns over 60% of the body, which finding should the nurse report immediately? The option allows the policyholder to retain the death benefit without being required to make additional future premium payments. Life Income, All of the following statements are true regarding a policys Grace period EXCEPT C) Incontestability B) settlement option D) experiencing financial hardship. b) The key employee has premiums deducted from his salary. Nonforfeiture Definition & Meaning - Merriam-Webster Full face amount minus any past due premiums. Which of these would be considered a Limited-Pay Life policy? All of the following are nonforfeiture options, EXCEPT. B) Extended term insurance A Its premium steadily decreases over time, in response to its growing cash value. Never tax deductible. However, the death benefit that surviving dependents of the policy owner would receive is lower than the amount of cash value in the original life insurance policy. Past-due interest payments not paid after 3 months will void the policy In order to convert the engine type (diesel or gasoline) to a qualitative variable, first add a variable. \text { Accounts Payable } & & 9,400 \\ C) Paid-up additions B) provide evidence of insurability, pay past due premiums Reduce your coverage for the remaining term of the policy and pay no futurepremiums. All of the following are considered to be nonforfeiture options In what part of an insurance policy are policy benefits found? the death benefit paid will be what the premium would have purchased at the correct age. All of the following are Nonforfeiture options EXCEPT: . The face amount equal to the cash value. B) Free-look period D) war. Grace period terms are stated in the policy. Which dividend option would an insurer invest the policyowners money and add any interest earnings as the dividends accrue? C) all remaining cash values are paid to the policyowner When a policy is in force for a longer duration, the better the cash values and the nonforfeiture values. This value is payable before death. The nonforfeiture benefit is designed to ensure that if you lapse your policy (i.e., stop paying premiums) after a specified number of years, you retain some benefits from the policy. Which provision will pay a portion of the death benefit prior to the insureds death due to a serious illness? A) Payment mode Which of these actions is taken when a policyowner uses a Life Insurance policy as collateral for a bank loan? A counselor receives a fee for advice, and can maintain a dual license as an agent and counselor. C) reinstatement provision D) Payor benefit. B) Paid-up additions Dorian exercised a nonforfeiture option by using his life policys cash value to purchase an extended term insurance option. With maintenance cost as the dependent variable and age, odometer miles, miles since last maintenance, and engine type as the independent variables, create a regression equation using statistical software by setting variable to 1. Overall, it's the accumulated portion of a permanent life insurance policy's cash value that is available to the policyholder upon surrender of the policy. reduction of premium Which situation accurately describes a reduced paid-up nonforfeiture option? I hope you got the correct answer to your question. The amount of cash value you will have built-in your policy will be reduced by the amount of any loans against your life insurance. a) Conversion b) Decreasing Term c) Reduced Paid-up d) Extended Term. Which military service exclusion clause would pay upon his death? 40% taxable, similar to a capital gain B. What kind of rider did S include on the policy? A) Reduction of premium B) Disability income rider g. Income taxes of$55,539 are owed but unrecorded and unpaid. C) accelerated benefit rider Adam received his master's in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology. What action can a policyowner take if an application for a bank loan requires collateral? An automatic premium loan is not considered a Nonforfeiture Option. Usually, permanent life insurance generates low returns in the early years of the policy due to administrative and acquisition expenses. S buys a $50,000 whole life policy with a $50,000 Accidental Death and Dismemberment rider. There are currently two common types of nonforfeiture benefits being offered with certain insurance policies covering long term care services. Whose life is covered on a life insurance policy that contains a payor benefit clause? D) Extended term rider, In a life insurance policy, the entire contract consists of, A) policy and conditional receipt He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem. The business pays the premiums that are not deductible, but the death is free from income taxes. D) Accumulation at interest. B) Changes in the insuring clause e. Wages in the amount of $3,450 are owed but unpaid and unrecorded at year end. For traditional whole-life policies, the owner decides which of four ways (see below) they would like to access the policys cash value.