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Flashcards in 12.2a Deck (6)
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1
Q

The ______ is similar in practice to an Indexed Whole Life insurance policy, and is typically tied to the Consumer Price Index or CPI. Known as a Cost of Living (COL) or a Cost of Living Adjustment (COLA) Rider, its face amount will ______ with a corresponding increase in an inflation index, such as the CPI. If an increase occurs, the policyowner is usually responsible for any increase in premium. If the index decreases, the policy’s face amount and premium do not decrease.

A

Cost of Living Rider

2
Q

Concerning the Cost of Living Rider, an important feature is the fact that ______ is not required when increases occur. However, if the index rises higher than what the insurer allows for a maximum face amount increase (usually 5%), no addition amount is added to the policy’s face amount.

A

evidence of insurability

3
Q

The ______ is referred to as a Family Rider or Child Rider and is incorporated into Family Protection, Family Income and Family Maintenance policies. Each family member who is added to either of these policies receives term life coverage as a rider to the whole life policy written on the policyowner, typically the breadwinner in the family.

A

Other (Additional) Insured(s) Rider

4
Q

Also known as a Living Need Rider, the ______ allows a terminally ill policyowner to collect the policy’s death benefit while still alive to pay for medical expenses as well as covering the terminally ill policyowner’s general costs of living. The eventual death benefit is reduced by the amount of living benefits spent while the policyowner was living.

A

Accelerated Death Benefit Rider

5
Q

The ______ pays medical expenses associated with an assisted living center without increasing the policy’s premium. Limits such as an elimination period, prior hospitalization of at least three days, and impaired daily activities are characteristic of this type of rider.

A

Long-Term Care Rider

6
Q

Used in conjunction with universal life insurance policies, the ______ allows a life policy to continue in force even if its cash value is zero as long as the policyowner satisfies the contract’s minimum premiums requirements, as defined in the policy.

A

‘No Lapse Guarantee’ Rider