LLQP (Life Licence Qualification Program) Practice Exam · Question
If a life insurance policy lapses due to non-payment of premiums and the insured dies before it is reinstated, what will the insurer typically do?
A lapsed policy is not in force. If the insured dies during the period of lapse, the insurer is not obligated to pay the death benefit.
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Question: If a life insurance policy lapses due to non-payment of premiums and the insured dies before it is reinstated, what will the insurer typically do?
Answer options:
- Pay the full death benefit.
- Pay the death benefit minus the overdue premiums.
- Offer to reinstate the policy to the beneficiary. ✅ Deny the claim as there was no active policy in force.
Correct answer: Deny the claim as there was no active policy in force.
Explanation: A lapsed policy is not in force. If the insured dies during the period of lapse, the insurer is not obligated to pay the death benefit.
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- A life insurance policy that offers lifelong coverage, a guaranteed death benefit, and a savings component tha
- Group benefits in Canada commonly include:
- Sarah, a 35-year-old marketing professional in Ontario, purchases a participating whole life insurance policy
- Mark, a 45-year-old business owner in British Columbia, has a Universal Life policy with a Level Cost of Insur
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