4) Clauses and Additions of Life Insurance Contract

Question 1

What are Clauses?

Answer 1

Standard provisions, or conditions, which make up each policy.

Question 2

What are additions

Answer 2

Allow personalizing the policy without changing the basic elements of the policy, this is done with an increase in premiums.

Question 3

HERES A BUNCH OF DIFFERENT CLAUSES

Answer 3

.

Question 4

Grace period

Answer 4

• This is the time limit that the insurance company grants to pay premiums
• there is no grace period for the first premium payment
• usually 30 days

Question 5

what is a lapsed contract

Answer 5

a contract that is no longer in effect

Question 6

What are the four conditions that a contract may be reinstated

Answer 6

1- Make a request
2- Provide Evidence of insurability
3- Pay overdue Premiums (with interest)
4- Repay premium loans

Question 7

What is Incontestability Clause

Answer 7

An insurer cannot contest a policy after it has been in force for two years unless there is a case of fraudulent misrepresentation.

Question 8

What is Suicide Clause

Answer 8

If the suicide occurs less than two years after the policy, the face amount will not be paid but the premiums paid so far will be repaid to the beneficiary.

(The two-year period applies to an increase in the face amount as well) [read example in book if confused]

Question 9

What is an insurable interest

Answer 9

An insurable interest must exist (a link between the policy owner and the life insured, such as a parent, child or even business partner) for the validity of a life insurance contract.

Question 10

Payment of death benefits: Minors

Answer 10

benefits payable to minors are paid to their parents, who are the legal guardians of their children

Question 11

Payment of death benefits: Mother and father are both deceased

Answer 11

Parents may designate a guardian for their minor children by will, by declaration sent to the public Curator, or by mandate; given in anticipation of death. The benefit is paid to the designated person.

Question 12

Payment of death benefits: Parents deprived of parental Authority

Answer 12

In this case, the benefit is paid to the child’s tutor/guardian, or if no tutor has been named, to the director of youth protection.

Question 13

Payment of death benefits: Persons of full age incapable of caring for themselves

Answer 13

Benefits are payable to those persons if a person is incapable of administering his or her property, the benefit is paid to the mandatory in case of incapacity (the tutor of the insured person’s property)

Question 14

What is Assignment Clause cession

Answer 14

ASSingment means the owner of the policy transfers ownership to another person with an interest in the insured’s life or health.

Question 15

What is a basic benefit

Answer 15

The risk that the insurer agrees to bear

Question 16

What are additional benefits

Answer 16

The additional benefits are added benefits to the basic benefit. The next six cards are the different types

Question 17

What is Premium waiver in case of disability of the policyholder

Answer 17

This is supposed that the policyholder in not the life insured such as the case of a parent with their child or the case where one of the spouses is the policyholder and the other is the insured spouse.

Question 18

What is Premium waiver in case of death of the policyholder

Answer 18

The policy will still be in effect at the policy holders death even if the ppremiums are no longer availible

Question 19

What is Premium waiver in case of disability of the insured

Answer 19

when the policy holder is also the life insured and becomes totally disabled, the premiums are no longer owed while he is disabled

Question 20

What is Accidental death and dismemberment

Answer 20

An accident is due to an external or violent cause, while the dismemberment means the loss of or use of a body member or a sense (sight)
in case of accidental death or dismemberment this benefit allows for the recipient of an additional face amount in addition to the basic benefits.

Question 21

What is disability benifit

Answer 21

The disability benefit pays a monthly benefit to the disabled insured.

Question 22

What is Guaranteed insurability benefits

Answer 22

this benefit allows you to increase coverage without any evidence of insurability, at dates fixed in advance, at the insured’s attained age. The policy holder is not required t increase coverage.

Question 23

What are endorsements (riders)

Answer 23

see book

Question 24

What is health endorsement

Answer 24

Provides for a single lump-sum payment of the specified benefits in the event of a critical illness diagnosis and if the insured lives for at least 30 days following the onset of the critical illness.

Question 25

What is family insurance Endorsement

Answer 25

this adds coverage for the spouse and children in the basic contract. this reduces the insurer’s administration charges. Coverage for the various family members is provided within a single life insurance contract.

Upon death of the policyholder, the premium for the family insurance endorsement is deemed paid until the normal expiration date of the endorsement.

Question 26

What is term insurance endorsement

Answer 26

This insurance may be decreasing term r a fixed face amount

the life insurance process begins with first requesting insurance. This is the application