Compute SYXS_{Y X}SYX and interpret your findings Compute the MADM A DMAD and interpret your findings. B) Buyers Guide Change the beneficiary, if revocable, Modify a provision in the insurance contract. C) Rider Which nonforfeiture option has the highest amount of insurance protection? A physical inventory shows that$650 of office supplies is on hand. All of the following are nonforfeiture options, EXCEPT: a. For some companies, this option may be automatic when surrendering a whole life insurance policy. PracticeTest Flashcards by Gabriel Martinez | Brainscape the death benefit paid will be what the premium would have purchased at the correct age. C) Accidental Death Rider Surrender Value: What's the Difference? A nonforfeiture clause is an insurance policy clause that is included in standard life insurance and long-term care insurance. Their purpose is to protect the insured's accumulated cash values in case the Whole Life or Endowment policy lapses. Which statement regarding the Misstatement of Age provision is considered to be true? How much will Ds beneficiarys receive? B) add-on B) $800 He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. Which military service exclusion clause would pay upon his death? C) all past premiums will be refunded with interest Investopedia requires writers to use primary sources to support their work. She can reestablish coverage under which of the following provisions? A nonforfeiture clause is an insurance policy clause stipulating that an insured party can receive full or partial benefits or a partial refund of premiums after a lapse due to non-payment. policy has a decreased face amount A life insurance policyowner does NOT have the right to. C) waiver of premium You can learn more about the standards we follow in producing accurate, unbiased content in our. 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? Which of these is considered to be a Living Benefit option in a life insurance policy? A) The original face amount will be paid to the beneficiary Tax deductible. fixed-period option. C) disability In what part of an insurance policy are policy benefits found? a. Prepaid Rent. C) The insurers obligation to pay a death benefit upon an approved death claim D) Bill the policyowner for back premiums. Loans obtained by a policyowner against the cash value of a life insurance policy A whole life policy option where extended term insurance is selected is called a. An error was made on Marys life insurance application. D) Reduced Paid-Up Insurance. d) Alzheimer's disease While normally mental and nervous disorders or disease are excluded in long-term care policies, Alzheimer's disease is not. Interest only is a settlement option. Joanne has a $100,000 whole life policy with an accumulated $25,000 of cash value. The Consideration clause in a life insurance contract contains what pertinent information? D) Extended term rider, In a life insurance policy, the entire contract consists of, A) policy and conditional receipt safeguard the insurer from an applicant who is contemplating suicide, A provision in a life insurance policy that pays the policyowner an amount that does not surpass the guaranteed cash value is called the. 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. B) settlement option One of the questions on the application asks if P engages in scuba diving, to which P answers "No". C) Return of premium provision It is taxed as capital gains A) Entire contract period When the term insurance expires, A) he has the option of resuming the original policy and paying the same premium Only the beneficiary may select, In a Life insurance contract, an insurance companys promise to pay stated benefits is called the. fare-paying passenger. Which of these is NOT a valid policy dividend option? With the paid-up policy option, you can use your cash surrender value to buy a paid-up version of the same type of life insurance policy so you would no longer have to make premium payments. What action can a policyowner take if an application for a bank loan requires collateral? Required fields are marked *. For example, if you purchase a policy when you were 20 and you paid until age 55, you would receive a term policy that is less than 35 years. Thanks for choosing us. Fin 351 Flashcards | Chegg.com C) are limited by the face amount of the policy Which of these is NOT considered to be a nonforfeiture option in a whole life insurance policy? D) Certificate of Authority, All of these are valid policy dividend options for a life insurance policyowner EXCEPT, A) cash outlay to the policyowner What is an insurance policys grace period? The meaning of NONFORFEITURE is failure or refusal to forfeit something often used before another noun. An insureds inability to perform two or more activities of daily living may trigger which type of policy rider? You can find out more about our use, change your default settings, and withdraw your consent at any time with effect for the future by visiting Cookies Settings, which can also be found in the footer of the site. D is the policyowner and insured for a $50,000 life insurance policy. beneficiarys age, M has an insurance policy that also has an outstanding policy loan at the time of Ms death. D) Full face amount. M had an annual life insurance premium payment due January 1. This provision is called a(n). Past due premiums are waived "Standard nonforfeiture law for life insurance.". C) reinstatement provision Inability of the insured to perform more than 2 Activities of Daily Living (ADLs), The Accidental Death and Dismemberment (AD&D) provision in a life insurance policy would pay additional benefits if the insured. There are currently two common types of nonforfeiture benefits being offered with certain insurance policies covering long term care services. D) Payor benefit. Unlike conventional loans, policy loans don't necessarily need to be paid back. Partially tax deductible depending on the income level. His insurance policy continues in force without payment of further premiums. One life insurance policy provision permits the policyholder to pledge certain rights in the life insurance policy to secure a loan. Life insurance policyholders can select one of four nonforfeiture benefit options: the cash surrender value, extended term insurance, loan value, and paid-up insurance. B) Entire contract \hline \text { Cash } & \$ 3,100 & \\ D) the claim would be denied, A) the policy would be payable, minus the premium amount, The two major actions required for a policyholder to comply with the Reinstatement Clause are, A) provide evidence of insurability, agree to a new incontestable period She is concerned, however, that if she becomes disabled she will be unable to pay the premiums as they come due. reduced paid - up insurance cash value . C) automatic premium loan 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. What action will the insurer take? P died five years after purchasing a life policy. B) Reduced paid-up insurance Free Flashcards about Chapter 3 N is covered by a Term Life policy and does not make the required premium payment which was due August 1. A young, married teacher has two children and owns a Whole Life policy. Which of the following is CORRECT regarding the death benefit amount? B) Make a premium payment after the due date without any loss of coverage B) No interest will be charged on loan balance Nonforfeiture values give the insured the right to the cash value even if the policy lapses or is surrendered. Waiver of Premium With the cash surrender value option, the policy owner terminates the policy and receives the remaining cash value within six months. C) transferable assignment Which of the following statements is true? D) Beneficiary. C) Accelerated rider Unpaid interest will be added to your loan amount and will be subject to compounding. B) Dividend options What time period allows an insureds life insurance policy to remain in force even if the premium was not paid on the due date? Whole life insurance is permanent life insurance that pays a benefit upon the death of the insured and is characterized by level premiums and a savings component. A) The face amount and policy premium are not affected by the payment What provision can Sheila add to her policy to address this concern? A waiting period must pass before becoming eligible for benefits The option that provides an additional death benefit for a limited amount of time at the lowest possible cost is called a(n), Accidental Death and Dismemberment rider (AD&D). A) Contest the terms of the policy after the issue date The automatic premium loan provision is designed to, All of these statements concerning Settlement Options are true EXCEPT \text { Accumulated Dcprcciation } & & \$ 104,000 \\ Increased proceeds can be provided through accumulation of interest Which nonforfeiture option has the highest amount of insurance protection? Explain your reasons. Such an option considers the saving component of the policy. E and F are business partners. P will have to pay income taxes on the amount of premiums waived If an insured dies because of an accident, which type of life insurance rider will provide additional coverage? a) A client with amyotrophic lateral sclerosis (ALS) tells the nurse, "Sometimes I feel so frustrated. Standard life insurance and long-term care insurance policies may have a nonforfeiture clause. What Is a Nonforfeiture Clause? 4 Payout Options Explained - Investopedia Extended-term insurance is often thedefault non-forfeiture option. \text { Unearned Service Revenue } & & 11,200 \\ B) Paid-up additions For traditional whole-life policies, the policyholder decides how they would like to access the policys cash value. T took out a $50,000 life insurance policy with an Accidental Death and Dismemberment rider. d) The PPO will pay reduced benefits. If Ron goes to a doctor who is not a PPO provider, what will happen? P cannot assign ownership of the policy while premiums are being waived, Which of these are NOT an example of a Nonforfeiture option? D) Grace period. 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. The term policy ends after a fixed number of years as detailed in the policys nonforfeiture table. Policy loans may still be made All of the following are optional methods of settlement after the insured has died EXCEPT life income option. It is taxed as ordinary income. Financial Modeling & Valuation Analyst (FMVA), Commercial Banking & Credit Analyst (CBCA), Capital Markets & Securities Analyst (CMSA), Certified Business Intelligence & Data Analyst (BIDA), Financial Planning & Wealth Management (FPWM). Also, the amount of reduced paid-up or extended-term insurance may decrease if a policys sub-account performance is poor or credited interest rates are low. B) 1/2 of the policys face amount A) Waiver of premium Which of these is NOT considered to be a common life insurance nonforfeiture option? Whose life is covered on a life insurance policy that contains a payor benefit clause? Please check below to know the answer. All of the following are true of Key Employee life insurance EXCEPT a) The death benefit is free from income taxes. Nonforfeiture Benefits for Life Insurance | Life Benefits c. Inventory. D) nonforfeiture provision, A whole life insurance policy accumulates cash value that becomes, A) the policy loan value which the insured may borrow against Accounting Cycle and Classifying Accounts, Adjusting Accounts for Financial Statements, Asset Demand and Supply under Uncertainty, Business Analytics & Technology Management Chapter 2, Business Analytics & Technology Management Chapter 3, Business Analytics & Technology Management Chapter 4, Business Analytics & Technology Management Chapter 5, Business Analytics & Technology Management Chapter 6, Capital Budgeting and Managerial Decisions, Derivative Instruments and Hedging Activities, External Financial Statements and Revenue Recognition, Financial Intermediaries and Financial Markets, Financial Markets and Securities Offerings, Financial Statements and Accounting Transactions, Integrated Marketing Communications and Direct Marketing, Interactive Marketing and Electronic Commerce, Interpersonal and Organizational Communication, Introduction to Human Resource Management, Introduction to Human Resources Assessment, Managerial Accounting Concepts and Principles, Market Segmentation Targeting and Positioning, Organization and Operation of Corporations, Organizational Markets and Buyer Behaviour, Profitability Analysis and Analytical Issues, Profitability Analysis and Decentralization, Reporting and Analyzing Long Lived Assets, Responsibility Accounting and Performance Measures, Understanding Interest Rates Determinants. An analysis indicates that prepaid rent on December 31 should be $2,300. Which of the following statements is (are) true with respect to life insurance policy loans? d) 6 months Pre-existing conditions must be covered after a policy has been in force for 6 months. You are eligible for the reduced "paid up" contingent nonforfeiture benefit when all three conditions shown below are met: The premium you are required to pay after the increase exceeds your original premium by the same percentage or more shown in the chart below; Triggers for a Substantial Premium Increase Issue Age Under 65 65-80 Over 80 b) Within 3 years. Just like with a conventional loan, youll be charged interest that could range from 5% to 9% on the loan. B) during the last 12 months C) $2,000 Which of these actions will the insurer take? B owns a Whole Life policy with a guaranteed insurability option that allows him to purchase, without evidence of insurability, stated amounts of, additional Whole Life coverage at specified times. B) Age C) A prorated death benefit based on the amount of insurance the insureds premiums would have been if purchased at the correct age 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. D) The amount of premiums paid will be returned with interest, C) The death benefit paid will be what the premium would be purchased at the correct age. d. Accumulated Depreciation-Equipment. B) policy and all sales material Which of the following statements is true? If D dies without making any further changes, to whom will the policy proceeds be paid to? The policyowner wants to make sure that upon his death, the life policy will pay a portion of the proceeds annually to his spouse, but that the principal will be paid to their children when they reach a certain . A) Reinstatement In what part of an insurance policy are policy benefits found? C) Waivers What does the ownership clause in a life insurance policy state? 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? C) suicide Flashcards - life policy provisions Some companies offer an annuity option in the nonforfeiture clause. One life insurance policy provision specifies that the insurer cannot deny payment to the beneficiary because of concealment or misrepresentation if the life insurance policy has been in force for two years during the insured's lifetime. Feel free to get in touch with us via email. B) nonforfeiture option Cookies collect information about your preferences and your devices and are used to make the site work as you expect it to, to understand how you interact with the site, and to show advertisements that are targeted to your interests. C) Paid-Up Additions Option A) Net death benefit will be reduced if the loan is not repaid The beneficiary is Ds wife. Depending on the age of the policy, the cash surrender value could be less than theactual cash value. B) Waiver of premium rider C) Reinstatement period Variable Whole Life Insurance can be described as. Correct answer: (D) B) Free look period Accumulation at Interest D was actively serving in the Marines when he was killed in an automobile accident while on leave.
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all of the following are nonforfeiture options except