Name and briefly describe the ten features found in almost all life insurance contracts

Question

What will be an ideal response?

Answer 1

Answer:
1. The beneficiary provision allows for a primary and contingent beneficiary to receive the death proceeds (face amount) upon the insured's death.
2. A grace period is an automatic extension for premium payments, generally 30 or 31 days after the premium is due.
3. The loan clause allows for loans, generally at a guaranteed rate, against the cash value of the policy.
4. A non-forfeiture clause gives the policyholder the cash value in exchange for the policy's termination, or allows exchanging the cash value for a paid-up policy with a reduced face value, or allows exchanging the policy's face value for a paid-up term policy.
5. The policy reinstatement clause provides the conditions for restoring a lapsed policy to its full rights, force, and effect.
6. A change of policy clause stipulates the conditions and allows the policyholder to change the form of the policy.
7. The suicide clause states that the insurance will not pay the death benefit for suicide during the first two years.
8. A payment of premium clause defines the alternatives for paying the premiums and allows for a change in payment methods.
9. The incontestability clause ensures that the insurance company cannot dispute the validity of the contract after it has been in force for a specified number of years, usually 2.
10. A list of settlement options gives the beneficiary options for receiving the policy benefits.