Life Insurance FundamentalsQuestion 150 of 716
Which of the following BEST illustrates 'return-of-premium term' insurance?
a.Premiums become fully tax-deductible at the end of the level term period
b.Premiums are waived during any period of total disability of the insured
c.If the insured outlives the term, the insurer returns the premiums paid
d.Premiums are refunded any time the policyowner surrenders the contract early
Explanation
Return-of-premium (ROP) term promises to refund the cumulative premiums paid if the insured survives the entire term. Premiums are higher than ordinary term because of this living benefit. The death benefit during the term is the same as standard level term.
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Related questions on this topic
- Which of the following is a category in which insurable interest in another person's life is generally recognized?
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PrepPass team · Verified against California Life & Health Insurance License Exam · How we review
Reviewed by John Zihao Zhang — California-Licensed Life Insurance Agent (CA Dept. of Insurance License #4396095 — verify)