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RMI 3011 Ch 12 - Life insurance Contractual Provisions RMI 3011 Florida State University -Questions with complete solution $13.49   Add to cart
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RMI 3011 Ch 12 - Life insurance Contractual Provisions RMI 3011 Florida State University -Questions with complete solution

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RMI 3011 Ch 12 - Life insurance Contractual Provisions RMI 3011 Florida State University -Questions with complete solution Ownership clause - correct answer The policyholder possesses all contractual rights in the policy while the insure is living. These rights include: naming, changing the ...

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  • November 30, 2024
  • 9
  • 2024/2025
  • Exam (elaborations)
  • Questions & answers

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  • rmi 3011 ch 12 life insurance contractual provis
  • rmi 3011 ch 12 life insurance contractual
  • rmi 3011 ch 12 life insurance contractual provis

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RMI 3011 Ch 12 - Life insurance
Contractual Provisions Questions with
complete solution
Ownership clause - correct answer ✔The policyholder possesses all
contractual rights in the policy while the insure is living.


These rights include: naming, changing the beneficiary, surrendering the
policy for its cash value, borrowing the cash value, receiving dividends, and
electing settlement options.


Entire-Contract clause - correct answer ✔States that the life insurance policy
and attached application constitute the entire contract between the parties.


Insurer cannot change the policies terms.


*Incontestable Clause - correct answer ✔States that the insurer cannot
contest the policy after it has been in force two years during the insured's
lifetime.


After two years, the insurer cannot later contest a death claim on the basis of
a material misrepresentation, concealment or fraud when the policy was first
issued.


Thus the insurer has two years to discover any irregularities in the contract.


*Suicide Clause - correct answer ✔States that if the insured commits suicide
within two years after the policy is issued, the face amount of insurance will
not be paid; there is only a refund of the premiums paid.

, *Grace Period Provision - correct answer ✔The policyholder has a period of
31 days to pay an overdue premium. Insurance remains in force during the
grace period.


Reinstatement Clause - correct answer ✔Permits the owner to reinstate a
lapsed policy.


Misstatement of Age or Sex Clause - correct answer ✔If the insured's age or
sex is misstated, the amount payable is the amount that the premiums paid
would have purchased at the correct age and sex.


Primary Beneficiary - correct answer ✔The beneficiary who is first entitled to
receive the policy proceeds on the insured's death.


Could be more than one party named. Amount each party receives must be
specified.


Contingent beneficiary - correct answer ✔entitled to the proceeds if the
primary beneficiary dies before the insured.


Revocable Beneficiary - correct answer ✔Means that the policyholder
reserves the right to change the beneficiary designation without the
beneficiary's consent.


Irrevocable beneficiary - correct answer ✔Is one that cannot be changed
without the beneficiary's consent.


Specific beneficiary - correct answer ✔Beneficiary is specifically named and
identified.

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