What is the grace period of a life insurance policy quizlet?
The period of time after the premium due date that the policyowner has to pay the premium before the policy lapses (usually 30-31 days). The purpose of the grace period is to protect the policyholder against an unintentional lapse of the policy.
What happens to policy coverage during the grace period quizlet?
grace period: Period of time after the due date of a premium during which the policy remains in force without penalty. … The grace period gives you a period of time when the premium is due and if you haven’t paid it, you are still covered. However, if you die during the grace period, they will subtract the premium owed.
What does the guaranteed insurability option allows an insured to do?
A guaranteed insurability rider lets you increase the coverage on your life insurance policy without taking another medical exam. It is also known as a guaranteed purchase option rider. You will usually pay higher premiums for a policy with this type of rider.
What is a grace period in insurance?
A grace period, in contract law, is the time a past-due payment can be made without penalty. … Grace periods are commonly incorporated into mortgage and insurance contracts; through “courteous goodwill,” you don’t lose your home or insurance if you’re a few days late with a payment.
What would be the duration of the grace period under her policy?
An insured pays a monthly premium of $100 for her health insurance. What would be the duration of the grace period under her policy? The grace period is 7 days if the premium is paid weekly, 10 days if paid monthly, and 31 days for all other modes.
Which life insurance policy allows the policyowner to have coverage equal to the net death benefit of the lapsed policy?
Choosing the nonforfeiture extended term option allows the policy owner to use the cash value to purchase a term insurance policy with a death benefit equal to that of the original whole-life policy. The policy is calculated from the insured’s attained age.
Which of these actions is taken when a policyowner uses a life?
Which of these actions is taken when a policyowner uses a Life Insurance policy as collateral for a bank loan? Collateral assignment” A policyowner using the Life Insurance policy as collateral for a bank loan normally would make a collateral assignment.
What is the minimum grace period for an individual health policy that is paid monthly quizlet?
Individual policies must also contain a grace period of at least 7 days for weekly premium policies, 10 days for monthly premium policies, or 31 days for all other policies for payment of each premium after the first.
Which life insurance policy provision allows a policyowner to cancel the policy and receive a full refund?
The free look period is a required period of time, typically 10 days or more, in which a new life insurance policy owner can terminate the policy without penalties, such as surrender charges.
Which type of life insurance policy allows a policyowner the choice of investments?
Universal life insurance is a type of permanent life insurance that allows you to build cash value, withdraw funds, and may have basic investment options. What is unique about this type of insurance is that it offers flexible premiums, giving the policy owner some ability to vary premium payments as income changes.
What type of insurance policy allows the policyowner to pay more or less than the planned premium?
An additional life insurance rider allows the policyowner to purchase additional participating paid-up insurance for an additional premium (called paid-up additions) that increases the death benefit and accelerates the cash value growth, of an insurance policy.