Which Of The Following Explanations Best Describes The Purpose Of The Waiver Of Premium Provision Of A Life Insurance Policy?

What happens when a policyowner borrows against the cash value of his life insurance policy?

Which statement regarding the life insurance premium for a children’s rider is true.

What happens when a policyowner borrows against the cash value of his life insurance policy.

The policy proceeds would be reduced by the outstanding loan balance.

Which of these is NOT a common life insurance nonforfeiture option?.

Which of the following is the best reason to purchase life insurance rather than annuities?

Based on those very simplistic explanations, the best reason for purchasing life insurance rather than annuities would be to provide for your loved ones if you do not have much saved up.

How many required provisions are in a life insurance contract?

12 mandatory provisionsIn general, the state requires 12 mandatory provisions and gives the insurance company discretion to include any of 11 optional provisions when writing a policy.

What is the waiting period on a waiver of premium rider in life insurance policies quizlet?

How long is the waiting period for the waiver of premium rider in life insurance policies? In most life insurance policies with the waiver of premium rider, the insured must be disabled for 3 to 6 months before the premium will be waived.

What is a waiver of contribution?

If, in the future, you couldn’t work for more than six months because of a serious illness or accident, waiver cover would continue to pay the contributions into your pension plan (certain conditions apply). You can apply for waiver cover up to age 58.

What are the two components of a universal policy?

Universal policy premiums include two components: the cost of insurance amount and the savings component amount, also known as the cash value. The cost of insurance (COI) is the minimum amount you must pay to keep your policy active. This amount varies based on your age, health, and insured risk amount.

What is a policy waiver form used for?

A waiver is an essential document that informs participants of the risks involved in certain activities and also protects you from liability. In some cases, you may limit your liability as a business by asking participants to sign a hold- harmless agreement.

Which type of life insurance policy generates immediate cash value?

No type of life insurance policy generates immediate cash value. Cash value grows over time and at a steady pace. The best type of policy to maximize cash accumulation is an index universal life insurance policy.

What is the advantage of a waiver of premium provision in a life policy?

A waiver of premium for payer benefit clause in an insurance policy says that the insurance company will not require the insured to pay a fee to maintain the plan under certain conditions. Most commonly, these conditions are the death or disability of the person paying the insurance premiums.

What is a waiver of premium disability benefit?

Waiver of premium for disability is a provision in an insurance policy that states the insurance company will not require the insured to pay the premium if they are seriously injured.

What is the primary purpose of the entire contract provision in a life insurance policy?

What is the primary purpose of the entire contract provision in a life insurance policy? The primary purpose of the entire contract clause is to make sure that the policyholder has all documents pertaining to the policy in their possession.

What does waiver of premiums mean?

A waiver of premium rider is an insurance policy clause that waives premium payments if the policyholder becomes critically ill, seriously injured, or disabled. Other stipulations may apply, such as meeting specific health and age requirements.

What is the waiting period on a waiver of premium rider in life insurance policy?

Most individual life insurance policies have a waiver of premium rider. “Once you are covered under a waiver of premium rider, the typical policy requires a waiting period of six months after you become disabled,” says Paul Wetmore, assistant vice president of Life Product Management at MetLife.

Which of the following is attached to a permanent life insurance policy?

Which rider, when attached to a permanent life insurance policy, provides an amount of insurance on every family member? Correct! With the “Return of premium” rider attached to the policy, upon the insured’s death, the benefit paid will be the face amount plus an amount equal to all the premiums paid on the contract.

What is provision of life insurance policy?

A life insurance policy can be transferred to another party, and such transference is called an assignment. The insurance company must be notified of the assignment; otherwise, the death claim will be paid to the beneficiary. An absolute assignment transfers all rights to the policy to the new owner.