If a Life Insurance Policy Lapses for Nonpayment of Premiums,and

question 57

Multiple Choice

If a life insurance policy lapses for nonpayment of premiums,and the policyholder has not elected another option,which nonforfeiture option usually goes into effect in most policies?

• A)reduced paid-up insurance
• B)one-year term insurance
• C)extended term insurance
• D)payment of cash value

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Definitions:

Machine-Hours

A measure of the amount of time machines are operated in the production of goods, often used to allocate manufacturing overhead costs.

Job-Order Costing

An accounting practice that tracks the costs associated with a specific job or batch of goods, capturing direct labor, materials, and overhead.

Predetermined Overhead Rate

A rate calculated at the start of an accounting period to allocate overhead costs to products or services produced.

Machine-Hours

The total time that machinery is operating and engaged in production activities during a specified period.