Which life insurance policy allows the policyowner to have coverage equal to the net death benefit?
Asked by: Jackeline Mosciski | Last update: January 23, 2026Score: 4.9/5 (7 votes)
Which life insurance policy allows the policyowner to have coverage equal to the net death benefit of the lapsed policy?
In summary, the Extended Term Non-Forfeiture Option is a feature in some life insurance policies that allows policy owners to maintain coverage equal to the net death benefit of their lapsed policy for a limited time, using the policy's cash value to purchase term insurance.
What is the difference between a straight life policy and a $20 whole life policy?
The main difference between a straight life policy and a 20 pay whole life policy lies in the premium payment period. In a straight life policy, premiums are paid throughout the insured's lifetime, while a 20 pay whole life policy requires premiums to be paid for a fixed period of 20 years.
What is a universal policy?
Universal life is a form of permanent life insurance that gives policyholders flexibility in paying premiums, a cash savings component, and a death benefit. Universal life insurance allows you to borrow against or cash in your savings portion, which grows tax-deferred over your lifetime.
Is the face amount of a life insurance policy the same as the death benefit?
The face value of the policy is simply the coverage amount the policy is worth. So, the face value of a $10,000 policy is $10,000. This is usually the same amount as the death benefit.
4 of 11: Type of Life Insurance Policies by RachaelKathleen.com
Is the accidental death benefit equal to the face amount?
AD&D insurance usually comes with significant coverage limitations, so always read the fine print. AD&D does not pay if the insured died due to natural causes, such as cancer or heart disease. Known as double indemnity, AD&D may pay a benefit equal to or a multiple of (usually 2x) the regular policy's face amount.
Is life cover the same as death benefit?
However, unlike a life insurance policy, a death in service benefit isn't underwritten (unless your benefit exceeds your employer's scheme limit) – meaning that an insurer won't ask you questions about your health or lifestyle to determine whether they would offer you cover and how much you'd need to pay.
What is the death benefit of a universal life policy?
Universal life insurance policies offer two death benefit options. Option 1 pays a straight death benefit, which includes the cash accumulated in your contract. Option 2 offers an increasing death benefit. When you die, your beneficiary gets the death benefit plus the accumulated cash value.
What is an example of universal coverage?
These include requiring or mandating health insurance, providing insurance (but not care) via a single government payer, and socialized medicine, in which both insurance and medical care are managed by the government.
What is an example of a universal rule?
The rules: help your family, help your group, return favours, be brave, defer to superiors, divide resources fairly, and respect others' property, were found in a survey of 60 cultures from all around the world.
Which of the following life insurance policies allows a policyowner to take out a loan?
The life insurance policy that allows a policyowner to take out a loan from the policy's cash value is Variable Universal Life. This type of policy combines the features of both universal life and variable life insurance.
What is another name for straight life insurance?
Whole life insurance is also referred to as “ordinary life” or “straight life.” It provides coverage for your entire lifetime. The premium depends on your age at the time you buy and stays the same as you grow older. The lowest premiums go to those who buy it when they're young, because they'll pay into it the longest.
Which of the following is a characteristic of a universal life insurance policy?
Beyond lifelong protection, there are a few additional features of universal life insurance: You can withdraw money or borrow against the policy's cash value. Your cash value earns interest. You have flexibility with premiums.
Which life insurance policy will provide both a fixed death benefit and guaranteed cash value?
Whole life insurance is a plan that is yours for your lifetime and features a death benefit and cash value component. This type of policy typically comes with higher premiums than guaranteed universal life insurance.
What is a life insurance policy that protects the policyholders until death called?
Permanent Insurance (Whole Life or Ordinary Life) While term insurance is designed to provide protection for a specified time period, permanent insurance is designed to provide coverage for your entire lifetime.
What is nonforfeiture in life insurance?
A nonforfeiture clause is an insurance policy clause that is included in standard life insurance and long-term care insurance. It stipulates that a policy owner will receive partial or full benefits or a refund of premium paid towards a whole life insurance policy if the policy lapses due to non-payment.
What is an example of a universal protection?
For universal precautions, protective barriers reduce the risk of exposure to blood, body fluids containing visible blood, and other fluids to which universal precautions apply. Examples of protective barriers include gloves, gowns, masks, and protective eyewear.
What is an example of a universal value?
Many different things have been claimed to be of universal value, for example, fertility, pleasure, and democracy. The issue of whether anything is of universal value, and, if so, what that thing or those things are, is relevant to psychology, political science, and philosophy, among other fields.
What is an example of universal condition?
Universal Condition Statements
A universal conditional statement is a statement that is both universal and conditional. Here is an example: For all animals a, if a is a dog, then a is a mammal.
What type of policy has a death benefit?
A death benefit is the primary reason someone purchases a life insurance policy; it's the amount of money your insurer will pay out to your beneficiaries if you die during the policy's term.
Who is the policyowner of a universal life policy?
In Indexed Universal Life (IUL) insurance, the Policyowner is the individual or entity with ownership rights of the policy. Responsibilities and authorities of the Policyowner: Premium Payments: Accountable for making regular premium contributions.
What is the option A on the universal life policy?
Universal life offers two options for how your death benefit will be paid: Level death benefit (option A): The sum is a fixed amount that doesn't change over time. Pays only the death benefit and no cash value.
Is life cover the same as death cover?
Death insurance cover. Death cover pays a lump sum to your beneficiaries (the people you choose to get your payout) if you die. It's also known as life cover or life insurance.
What is an assurance policy?
Key Takeaways. Assurance refers to financial coverage that provides remuneration for an event that is certain to happen. Unlike insurance, which covers hazards over a specific policy term, assurance is permanent coverage over extended periods, often up to the insured's death such as with whole life insurance.
What is the death benefit of life insurance policy?
Death Benefits are the guaranteed or assured amount provided to the nominees/ beneficiaries of the policyholder in the event of his/her untimely demise. The death benefit of life insurance is paid within a month (30 days) of filing the claim in most situations.