ECONOMICS
INSURANCE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The loss of John’s income
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A reduction in the family’s standard of living
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Death-related expenses to be paid
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An increase in income and expenses
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Detailed explanation-1: -As mentioned, a payor benefit provision is designed to protect the child of the policyholder in the event the policyholder becomes disabled, dies, or is no longer able to pay for policy premiums.
Detailed explanation-2: -If the owner dies before the insured, the policy remains in force (because the life insured is still alive). If the policy had a contingent owner designation, the contingent owner becomes the new policy owner.
Detailed explanation-3: -the insurance company agrees to pay a sum of money upon the death of the insured person. the beneficiary – the person or persons named by the policy owner – will receive policy proceeds (benefit) upon the death of the insured person.
Detailed explanation-4: -The most popular ways to cash out a death benefit is receiving it as either a lump-sum payment or as an annuity-a monthly or annual payment. Most beneficiaries choose the lump-sum payment and work with their financial planner or advisor to set up a financial plan. The death benefit is paid out in full.