The provision in a life insurance policy that provides protection against unintentional policy lapse is known as the:
A Reduction of Premium Option
B Waiver of Premium Benefit
C Payor Clause
D Automatic Premium Loan Provision
Text Explanation: D
Automatic Premium Loan (APL) is a rider that can be added to any life insurance policy that has or will have a cash value. It cannot be added to Term insurance. It is usually free, but the producer or client must check this option on t
Upon your death, if your beneficiary chooses the interest only settlement option, the:
A Proceeds are taxable
B Interest is taxable
C Principal reverts to the insurer
D Both the proceeds and the interest are taxable
Text Explanation: B
Although the death benefit would not be taxable to the beneficiary any interest paid to the beneficiary on the death benefit amount would be taxable as ordinary income.
All of the following are true about the reinstatement of a lapsed Life insurance policy EXCEPT:
A Applicants must apply within a certain period of time
B Applicants must pay back premiums
C Reinstatement is based upon current age
D Applicants must pass a
Text Explanation: C
The right to apply for Reinstatement is a mandatory provision in a Life policy. If the policy lapses, the owner has the right to apply, but reinstatement is subject to underwriting and paying all back premiums due, plus interest. If an
When an insured sells or assigns their life insurance policy to another party in order to get money to pay for terminal expenses, it is known as a(an):
A Absolute Assignment
B Collateral assignment
C Accelerated benefit
D Viatical settlement
Text Explanation: D
If you get a terminal illness, you may need money to pay for the cost of care prior to your death. You can sell your policy to an investor at a discount by assigning your rights of ownership to the investor, who now names himself as be
Which of the following Settlement Options provides for payments to be made in regular installments of a specified amount until the principal and interest are exhausted?
A Fixed Amount
B Fixed Period
C Interest
D Life Income
Text Explanation: A
When the insured dies, the beneficiary may select any one of five Settlement Options. They are: Cash; Fixed Amount (for example, the beneficiary elects to receive $1,000 a month for as long as the money lasts); Fixed Period (the benefi
Which of the following is a non-forfeiture option that provides continuing cash-value buildup:
A Extended Term
B Cash Surrender
C Reduced Paid-up
D Deferred Annuity
Text Explanation: C
There are only three non-forfeiture options: 1) Cash Surrender, 2) Reduced Paid-Up and the automatic option, 3) Extended Term. Their purpose is to protect the insured's accumulated cash values in case the Whole Life or Endowment policy
If a parent purchases life insurance on their child all of the following are true EXCEPT:
A The parent is the owner of the policy
B The child is the insured
C The parent is responsible for the premium
D The parent is the insured
Text Explanation: D
This is an example of third party ownership. Remember, the owner and the insured are not always the same person. In this example the parent is the policy owner and the child is the insured. The policy owner retains all the rights of ow
If a life-insurance policy does not permit the policyholder to change the beneficiary, the beneficiary is:
A Subsequent
B Irrevocable
C Contingent
D Guaranteed
Text Explanation: B
Typically, the insured or policyholder may change the beneficiary designation at any time. This is called Revocable Beneficiary designation. However, if the insured or policyholder elects to appoint an Irrevocable Beneficiary, the desi
Which of the following statements about Adjustable Whole Life is true:
A Adjusting the premium will also adjust the face amount
B Reducing the premium will increase the face amount
C Increasing the premium will lengthen the premium payment period
D In ord
Text Explanation: A
Adjustable Whole Life is the most flexible type of Whole life insurance. You can adjust the premium, amount of coverage and coverage period. Adjustments made to each feature will affect the other features. If you adjust the premium the
Generally, all are true, EXCEPT:
A Mutual life insurers cannot guarantee their future dividend scale
B Misrepresentation on an application can void coverage, if material
C Agents act in a fiduciary capacity when handling premiums
D You can project future
Text Explanation: D
Only "participating" policies issued by mutual insurers might pay dividends to policyholders. Non-participating policies are issued by stock insurers and may pay dividends only to shareholders. In either case, it is illegal to guarante
Which Life insurance settlement option takes into account the life span of the beneficiary:
A Life income option
B Fixed amount option
C Fixed period option
D Interest option
Text Explanation: A
The Life income settlement option is actually an annuity option. Remember, annuity payouts are based upon the expected life span of the annuitant, who in this case would be the beneficiary of the policy. This settlement option will mak
All of the following are a part of a life insurance policy, EXCEPT the:
A Insuring Clause
B Conditional Receipt
C Copy of the application
D Incontestability Clause
Text Explanation: B
Under the Entire Contract Provision, a copy of the insured's application for life insurance is attached to the policy. If it weren't, any false answers (misrepresentations) by the insured would not be admissible, since they would not b
A collateral assignment on a Life insurance policy:
A Is an absolute change of ownership
B Is a partial assignment of some rights to a creditor
C Designates an irrevocable beneficiary
D Allows early payment of proceeds in the event of a terminal illness
Text Explanation: B
The owner of a Life policy may pledge the policy as collateral for a loan from a bank, who would then have a temporary lien against the policy. If the insured dies during the term of the loan, the insurer will pay off the bank. Any rem
The Spendthrift Clause on a life insurance policy keeps the beneficiary from doing any of the following, EXCEPT:
A Commuting the proceeds
B Spending the proceeds
C Assigning the proceeds
D Transferring the proceeds
Text Explanation: B
The spend thrift clause prevents the beneficiary from changing the way you specified you want the proceeds to be paid when you die. For example, you specified that the proceeds be paid to your beneficiary over a 20-year period in the e
If the beneficiary of a life policy wants the proceeds to be paid out in equal monthly payments, they should select which settlement option:
A Period certain
B Fixed period
C Fixed amount
D Interest
Text Explanation: C
There are five life insurance settlement options: 1) cash; 2) fixed period; 3) fixed amount; 4) interest only; and 5) the annuity option. If the beneficiary selects the fixed amount option, the proceeds will be paid out in equal monthl
All of the following are true regarding accelerated benefits, EXCEPT:
A They are treated as a policy loan
B They reduce the amount payable to the beneficiary at death of the insured
C They are added as a rider to some policies but build into others as a p
Text Explanation: A
Accelerated or living benefits are not treated as a loan and no interest will accrue, although any amounts paid will reduce the amount payable at death.
All of the following are dividend options on a life insurance policy issued by a mutual insurer, EXCEPT:
A Extended term option
B Cash
C Apply to premium when due
D Paid-up additions
Text Explanation: A
Be sure to know the difference between the "non-forfeiture" options and the "dividend" options. All policies with a cash value must have non-forfeiture options but only policies issued by mutual insurers have dividend options. The thre
When the insured lists a group of beneficiaries it is known as a:
A Class designation
B Individual designation
C Minor designation
D Trust designation
Text Explanation: A
The owner of the policy can designate the beneficiary anyway they choose. The designation described in the question is a class designation such as "all my children".
If the interest on a policy loan is not repaid:
A It will be added to the premiums due
B It will be added to the amount of the loan outstanding
C It will have no effect on the policy benefits
D It will be turned over to a collection agency
Text Explanation: B
Interest on life insurance policy loans accrues annually on a pre-paid basis. Assuming the interest rate on a policy loan is 8% (the maximum allowed in most states), a client borrowing $10,000 from his insurer using his cash value as c
When someone other than the insured is the owner of a life insurance policy, the owner may do all of the following without the insured's consent, EXCEPT:
A Surrender the policy for its cash value
B Increase the amount of insurance
C Make a policy loan
D C
Text Explanation: B
As owner of the policy, this "third party" has the right to control the policy, including the beneficiary designation, taking a loan or even surrendering the policy for cash. However, under the Doctrine of Insurable Interest, the polic
Which of the following is true if the insured/owner of the policy does not pre-designate a settlement option for the beneficiary prior to death:
A The beneficiary may select the settlement option upon death of the insured
B The insurer may select the sett
Text Explanation: A
The insured/owner of the policy has the right to pre-designate how they would like the beneficiary to receive the face amount of the policy upon their death. However, if the insured does not, the beneficiary has the right to select fro
A life insurance customer misstates his age as being five years less than it really is. The rate he pays is $13 per $1,000 of coverage, but the correct rate is $15 per $1,000. If he dies, how much will the insurer pay:
A None, since the policy is voided i
Text Explanation: C
It is too late to adjust the premium, so the insurer will adjust the face amount instead. The adjustment is based on what the premium that the client paid would have purchased if he would have disclosed his true age. He did pay $13 per
Seth Brown, whose wife is his business partner, buys a life insurance policy on his wife's life. Because of this third-party ownership, the beneficiary should be the:
A Policyholder
B Policyholder's wife
C Policyholder's estate
D Policyholder's children
Text Explanation: A
This is an example of Key Person insurance. The beneficiary is Mr. Brown, the policyholder. His wife, the key person, is the insured. Mr. Brown apparently feels that if his wife should die, he would need the funds from the policy proce
Which whole life non-forfeiture option provides lifetime coverage:
A Extended term
B Reduced Paid up
C Paid up additions
D Life income
Text Explanation: B
All cash value life insurance policies must contain 'non-forfeiture' options or provisions, which are also known as 'guaranteed' values. In other words, the cash value in the policy belongs to the policy owner and cannot be forfeited t
When a creditor has a temporary interest in a life insurance policy, it is known as a:
A Lien
B Absolute assignment
C Ownership provision
D Collateral assignment
Text Explanation: D
There are two types of assignments, absolute and collateral. An absolute assignment would occur when you sign over your ownership of a life policy you bought on your child to the child when they attain age 21. You are giving up all rig
Which is not a reason to buy life insurance on the life of a child:
A To provide the child with benefits in the event that a parent dies
B To provide cash value for college
C To provide coverage in the event the child dies
D To provide for the child's ret
Text Explanation: A
A policy written on a child will pay benefits if the child dies, not the parent. Parents often purchase life insurance on children, which is a form of third party ownership. The parent is the owner, but the child is the insured. The pa
An insurance company has which of the following options when an insured wishes to cash in his policy?
A It must pay him within two weeks
B It must pay him within 90 days
C It may delay payment for one month
D It may defer payment for as long as six months
Text Explanation: D
In order to discourage a possible "run on the bank," so to speak, life-insurance companies do have six months to defer the granting of a policy loan or a cash surrender. However, most insurance companies will grant a loan or a cash sur
A life insurance company may contest a policy during the Contestable period for which of the following reasons?
A Nonpayment of premiums
B Material misrepresentation
C Change of occupation
D Misstatement of age
Text Explanation: B
The Incontestability clause states that the policy is "contestable" for the first two years for material misrepresentation by the insured on the application for insurance. Life-insurance policies do not have a change-of-occupation clau
Which statement about the Misstatement of Age Provision in a life insurance policy is true?
A If the insured's age has been overstated, it provides that a premium refund and the face amount of the policy will be payable
B If the insured's age has been und
Text Explanation: B
The Misstatement of Age Provision is separate from the Incontestability Clause. Lying about age cannot void the policy. However, it can reduce the amount of benefits paid at the time of your death. The formula to calculate this is as f
An insured on a tight budget who has a Whole Life insurance policy written by a mutual insurer should select which dividend option:
A Cash
B Reduction of premiums
C Paid up additions
D Interest option
Text Explanation: B
Mutual insurers write 'participating' policies, which might pay a dividend to policyholders. If a dividend is declared, the policyholder may choose from 5 different dividend options: 1) cash; 2) interest; 3) apply to next premium when
Which settlement option might provide payments that exceed the proceeds of the policy and the interest earned?
A Life Annuity
B Fixed Period
C Fixed Amount
D Interest Only
Text Explanation: A
There are five settlement options from which a beneficiary may select upon death of the insured. 1) Cash, 2) Fixed Period (proceeds, plus interest, are all paid out over a fixed period of time, say 10 years), 3) Fixed Amount (the benef
In a policy insuring the life of a child, which of the following allows the premiums to be waived in the event of the death or disability of the person responsible for premium payments?
A Waiver of Premium Provision
B Reduction of Premium Option
C Payor P
Text Explanation: C
The Payor Provision (sometimes called Payor Waiver of Premium) is an optional provision (or rider) often added to a policy insuring the life of a minor. The adult (usually the parent) may become sick or disabled and become incapable of
Protection against unintentional lapse of a Life policy is afforded by:
A A policy loan
B An automatic-premium loan
C A non-forfeiture option
D A Dividend option
Text Explanation: B
Automatic Premium Loan (APL) is a rider, usually free, that may be attached to any life-insurance policy that has or will have a cash value. It is not a Nonforfeiture option or Dividend option. If the insured fails to make a premium pa
An insured has a Whole Life policy with a $100,000 face amount and a $40,000 cash value. The insured's policy lapses, which non-forfeiture option should they select to provide lifetime coverage:
A Reduced Paid-up
B Cash Surrender
C Extended Term
D Paid-up
Text Explanation: A
Once the insured's policy lapses the insurer has to offer the insured the choice of what they want to do with their cash value. The three non-forfeiture options are: Cash Surrender, Extended Term and Reduced Paid-up. If the insured wan
In 1990, Mr. Smith bought a Life insurance policy on his 6 year old son, Jimmy, naming himself as beneficiary. Now that Jim is 18 years old, Mr. Smith may transfer all rights of ownership in the policy to him by executing a:
A Viatical settlement
B Absolu
Text Explanation: B
The owner of a life insurance policy may absolutely assign (transfer) all their rights of ownership to another party by executing (signing) an 'absolute assignment'. The new owner would now have all the rights of ownership, including p
If an insured buys the Return of Premium Rider and dies, the policy will pay the beneficiary:
A The face amount only
B All premiums paid up until the date of death
C The cash value plus the face amount
D The face amount plus all premiums paid up until the
Text Explanation: D
The Return of Premium rider is a type of 'increasing' term insurance. If a person wants their beneficiary to have the face amount of their life insurance plus all the premiums they paid in up to the date of their death, they can add th
A Life insurance rider that provides Whole Life on the primary insured and Term Life on the insured's spouse and children is the:
A Combination rider
B Family income rider
C Family maintenance rider
D Family rider
Text Explanation: D
Adding the Family Rider to your whole life policy is the cheapest way to provide coverage for your entire family. For example, you have a $100,000 permanent whole life policy on yourself. You add a $50,000 10 year level term to cover y
A $10,000 life insurance policy with a Triple Indemnity Clause has been in force for three years. The insured is injured in a train wreck and dies in a hospital five months later. The death proceeds payable under the policy would be:
A $30,000
B $20,000
C
Text Explanation: C
Accidental Death Benefit (ADB), sometimes called Double or Triple Indemnity, is a rider that may be attached to any life insurance policy for an extra premium charge. The additional benefits are paid only if the insured dies within 90
A rider added to a life policy to create coverage for your entire family is the:
A Family Income Rider
B Family Rider
C Family Maintenance Rider
D Other Insured Rider
Text Explanation: B
A Family Rider allows the breadwinner to add level, convertible term insurance as a rider to his or her whole life policy to cover their spouse and all their children. The term insurance on the spouse is often written for 10, 15 or 20
The purpose of a Grace Period provision is to:
A Protect the insurance company against adverse selection by policyholders
B Protect the policyholder against unintentional lapse
C Permit the beneficiary to establish an insurable interest
D Permit the insur
Text Explanation: B
Grace Periods are: 30 days on Whole Life, Term, and Endowment; 28 days on Industrial Life, and 31 days on Group Life. If the insured dies within the grace period, the overdue premium is subtracted from policy proceeds and the beneficia
All of the following are true when a life insurance premium is overdue, EXCEPT:
A The policy will lapse at the end of the grace period
B Non-forfeiture provisions apply to lapsed whole life policies
C A policy may be reinstated if certain conditions are s
Text Explanation: D
Although the right to apply for reinstatement is a mandatory provision in a life policy, the insurer will usually require that the insured pass a physical exam as well as pay the overdue premiums prior to reinstatement.
Darla Jenkins purchased a $100,000 individual Whole Life policy January 1, 2009 and paid an initial annual premium of $1,000. After her policy is issued Darla becomes interested in hang gliding and dies in a hang gliding accident on January 15, 2010, with
Text Explanation: A
Since Darla died during the grace period, the insurer will pay the face amount minus the overdue premium she should have paid ($100,000-$1,000=$99,000). If Darla had died after the 30 day grace period without paying her premium there w
The cash value of a life insurance policy may be used for all, EXCEPT:
A To supplement retirement
B To generate funds that will be available 15 years from now
C To serve as collateral for a policy loan
D To meet the expenses of college tuition one year af
Text Explanation: D
Although single premium whole life policies will develop a cash value immediately, most life insurance policies take three years to develop a cash value, and even then it will be minimal. The cash value generally grows very gradually a
Which of the following best describes the waiver of premium rider:
A It is a rider that can only be added to a cash value life insurance policy which creates a loan against the cash value in order to pay the premium for the insured
B It is a rider that ca
Text Explanation: C
The waiver of premium rider can be added to any policy and will waive the insureds premium after a six month waiting period if the insured becomes totally disabled. During the six month period the insured is responsible for paying thei
An insured died during the grace period of her life insurance policy and had not paid the required annual premium. The insurance company is obligated to pay which of the following to the beneficiary:
A The cash value of the policy, if any
B The full face
Text Explanation: C
There are three grace periods to remember: 28 days on Industrial Life, 30 days on all other life except group, and 31 days on group life. The purpose of the grace period is to protect the insured who honestly forgot to pay on the due d
A life insurance benefit payable while the insured is still living is:
A Double indemnity
B Accelerated benefits
C Fixed amount settlement option
D Accidental death benefit
Text Explanation: B
Accelerated benefits may be paid out to an insured while still living. For example, if an insured has a terminal illness he may request that the insurer pay out part of his death benefit early. The insured may use the funds for any pur
The insuring agreement or clause in a Life insurance policy contains all of the following EXCEPT:
A The name of the insurer
B The name of the insured
C The coverages
D How to change the beneficiary
Text Explanation: D
The right to designate or change a beneficiary is stated in a section of the contract entitled 'owners rights'. The insuring agreement states the names of the parties to the contract, the coverage and the consideration for the contract
Most assignments of life-insurance policies are made in order to protect the:
A Insured's insurability
B Insured's personal or business credit
C Beneficiary from the claims of creditors
D Insurance company from fraudulent claims
Text Explanation: B
Collateral Assignments, in which the insured pledges his policy to the bank as collateral for a bank loan, are very common. When the loan is paid off, the Collateral Assignment drops off. A Collateral Assignment assures the bank that i
All are false about Automatic Premium Loan on a Life insurance policy EXCEPT:
A It is a non-forfeiture provision
B It pays premiums due at the end of the grace period
C It is a rider requiring the payment of an additional premium
D It is attached to all W
Text Explanation: B
Automatic Premium Loan (APL) is a rider that may be added only to a cash value Life insurance policy. Although most riders cost extra, this rider is free, since it is designed to keep the policy from lapsing, which benefits both the in
A revocable beneficiary:
A Must give their consent before a loan may be taken
B Must give their consent before cash surrender may be taken
C Has no vested interest in the policy
D May never be changed
Text Explanation: C
The owner of a life insurance policy may change (or revoke) the beneficiary at any time, unless he initially made an 'irrevocable' designation. Irrevocable designations are rare, although they are sometimes required as part of a proper
A client bought an annual renewable term policy with a face amount of $100,000 on June 1, 2009 for an annual premium of $200. If he died on June 20th, 2010 without paying his renewal premium when due, the insurer would pay:
A Zero
B $99,800
C $100,000
D $
Text Explanation: B
'Ordinary' life insurance, which consists of whole life, term and endowment, is required by law to have a grace period of at least 30 days. Since this client died within the grace period, the insurer has to pay the face amount, less th
If the insured's age was overstated at the time a life-insurance policy was purchased and the error is discovered on the death of the insured, the insurance company will:
A Void the policy
B Be prevented from taking any action according to the provisions
Text Explanation: D
This is the reverse of the typical situation, in which the insured usually understates their age in order to have a lower premium. If the insured had overstated their age, then of course, they would have been paying a higher premium th
Which of the following statements is true about a policy assignment:
A It permits the beneficiary to designate the person or persons to receive the benefits
B It is valid during the insured's lifetime only because the death benefit is payable to the named
Text Explanation: C
There are two types of assignment: Absolute and Collateral. An Absolute Assignment transfers all of the policyholder's rights to another party, such as when a parent assigns the policy to the child who is also the insured. A Collateral
Which of the following statements about the Automatic Premium Loan provision in a life-insurance policy is true?
A A loan taken under the provision is not interest-bearing
B The provision must be elected by the policyholder
C The provision applies only to
Text Explanation: B
Automatic Premium Loan (APL) is a rider attached to Whole Life or Endowment policies, never Term. It must be elected by the policyholder, even though it is usually free. The purpose of the rider is to keep the policy in force if the in
All of the following are non-forfeiture options on a Whole Life insurance policy EXCEPT:
A Cash surrender
B Paid up additions
C Extended term
D Reduced paid up
Text Explanation: B
There are only 3 non-forfeiture options: 1) cash surrender; 2) reduced paid-up; and 3) the extended term option. 'Paid-up additions' is a dividend option, which is available only on whole life policies issued by mutual insurers who iss
The owner of a business is insured under a $100,000 Key Employee Life policy that contains a Double Indemnity clause and a Suicide Clause. The business has paid the annual premium of $2,000. Six months after the inception date of the policy, the insured c
Text Explanation: C
If an insured dies by suicide within the first two years of a new life insurance policy, there is no coverage. However, the insurance company will refund the premium paid to the beneficiary.
All are true about the rider called Accidental Death Benefit, EXCEPT:
A It has a lower cost per $1,000 than does life insurance
B It pays double when the insured dies as a result of sickness
C It requires death to occur within a certain period of time
D I
Text Explanation: B
ADB or accidental death benefit rider is a type of health insurance that can be added to a life policy by means of a rider. The rider costs about $1.00 per $1,000 of coverage, but drops off the policy at older ages since the chance of
Which of the following riders is added to a policy written on the life of a child to make sure the premium is paid if the policyholder dies or becomes disabled:
A Automatic premium loan
B Extended term option
C Payor benefit rider
D Accelerated benefits r
Text Explanation: C
The payor benefit rider is like waiver of premium, except it is added to a policy written on the life of a child.
Which statement about a typical Suicide Clause in a life insurance policy is true?
A Suicide is excluded as long as the policy is in force
B Suicide is excluded for a specific period of years and covered thereafter
C Suicide is covered for a specific peri
Text Explanation: B
The Suicide Clause, which is completely separate from the Incontestability Clause, excludes coverage for death resulting from suicide during the first two years of a policy. After that, suicide is covered. If the insured dies by suicid
Which of the following beneficiary designations on a life insurance policy is "by class":
A To both my children, Suzy and Scott equally
B To my estate
C To all my children
D To my family trust
Text Explanation: C
If you designate 'all your children' as primary beneficiaries of your life insurance policy, you have made a 'class' designation, rather than an individual designation. In other words, any person who can prove that they are your child
All are true about life insurance, EXCEPT:
A An Automatic Premium Loan rider will keep a Whole Life policy from lapsing
B Reinstatement of a lapsed policy is subject to certain conditions
C The cash value of a Whole Life policy may be used to supplement r
Text Explanation: D
IRS rule 1035 allows the same person to defer taxes when switching from one life insurance policy to another as long as all the conditions are met. However, policies do not have to be with the same insurer.
A life insurance rider added to cover a child is usually what type of insurance:
A Whole life
B Level term
C Decreasing term
D Increasing term
Text Explanation: B
A 'rider' is something added to a policy to modify its terms, usually for an additional premium charge. The cheapest way to provide life insurance coverage for your entire family is to add a 'family' rider to your whole life insurance
If the insured understated his age and the error is discovered after the insured's death, the insurance company will:
A Refuse to pay the death claim
B Refund all past premiums paid with any accumulated interest
C Pay the face amount of the policy with a
Text Explanation: D
Under the Misstatement of Age clause, the insurance company is protected against clients who state they are younger than they really are in order to obtain a lower rate. Although lying about your age will not void the policy, the compa
Life insurance policy dividends are considered to be:
A A sharing of company profits with the stockholders
B A return of a premium overcharge
C A sharing of company profits with the policyholders
D A guaranteed amount paid to reduce the cost of insurance
Text Explanation: B
Mutual insurers write 'participating' policies, which means that their policy owners MAY receive dividends, at the discretion of the Board of Directors. If paid, such dividends are not taxable, since the IRS considers them to be a retu
The life insurance policy clause that prevents an insurance company from denying payment of a death claim after a specified period of time is known as the:
A Misstatement of Age Clause
B Incontestability Clause
C Reinstatement Clause
D Insuring Clause
Text Explanation: B
The Incontestability Clause protects the client who may have lied (misrepresentation) on the original application for life insurance. The company has two years to investigate the insured from the original date of application. If the cl
When the primary beneficiary predeceases the insured, the proceeds are paid to the:
A Tertiary beneficiary
B Alternate beneficiary
C Contingent beneficiary
D Collateral beneficiary
Text Explanation: C
Often the insured will name a Contingent Beneficiary to receive policy proceeds if the Primary Beneficiary has predeceased the insured. If no Contingent Beneficiary had been named in this instance, the policy proceeds would go to the e