Malcolm Would Like to Purchase Life Insurance

question 1

Multiple Choice

Malcolm would like to purchase life insurance.He is concerned that he might need additional life insurance in the future and that he might be uninsurable at that time.What provision can Malcolm add to his life insurance policy that will permit him to purchase additional life insurance at specified times in the future without providing evidence of insurability?

• A)double indemnity rider
• B)guaranteed purchase option
• C)waiver-of-premium provision
• D)accelerated death benefits rider

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Definitions:

Cash Dividend

A distribution of a company's earnings to shareholders in the form of cash.

Voting Common Stock

Shares that give the shareholder voting rights in corporate decisions, typically involving one vote per share owned.

Net Unrealized Gains/Losses

Represents the difference between the current market value of held investments and their original purchase prices, not yet realized through sales.

Equity Method

An accounting technique used to record investments in which the investor has significant influence over the investee but does not have full control.