#1
What does the grace period provision in a life insurance policy allow?
A period after the premium due date to pay the premium without policy lapse
ExplanationProvides time to pay premiums after due date without policy lapse.
#2
Which of the following is NOT a consideration when determining the premium of a life insurance policy?
Credit score
ExplanationCredit score is not a factor in premium determination.
#3
Which of the following is NOT a type of life insurance policy?
Renewable life insurance
ExplanationRenewable life insurance is not a policy type.
#4
Which provision allows policyholders to change their policy from one type to another without providing evidence of insurability?
Conversion privilege
ExplanationAllows policyholders to change policies without proving insurability.
#5
What is the purpose of the suicide provision in a life insurance policy?
To prevent beneficiaries from receiving benefits if the insured commits suicide within a certain timeframe after policy issuance
ExplanationPrevents benefit payout for suicide within a specified timeframe.
#6
What does the term 'cash value' refer to in a life insurance policy?
The amount of money a policyholder can borrow against the policy
ExplanationMoney available for borrowing against the policy.
#7
Which provision allows a policyholder to receive a portion of the death benefit early if diagnosed with a terminal illness?
Accelerated death benefit
ExplanationAllows early access to death benefit for terminal illness.
#8
What is the primary purpose of the beneficiary designation provision in a life insurance policy?
To designate who receives the policy's death benefit
ExplanationDetermines recipient of death benefit.
#9
What does the term 'policy loan provision' allow policyholders to do?
Borrow money from the insurance company using the policy's cash value as collateral
ExplanationEnables borrowing against policy's cash value.
#10
Which of the following statements about the incontestability provision is true?
It applies only during the policy's contestability period
ExplanationValidity cannot be contested after contestability period.
#11
What does the contestability provision in a life insurance policy typically specify?
The timeframe during which the insurer can contest the validity of the policy
ExplanationSpecifies the duration for contesting policy validity.