Difficulty: Easy

Average Score: 100%

Which of the following is NOT true about a family life insurance policy? When the family policy covers children

Rationale

Coverage for children may be converted to permanent insurance but evidence of insurability is required.

This statement is not true regarding a family life insurance policy as it implies that evidence of insurability is necessary for conversion, which contradicts standard practices that often allow conversion without such requirements for dependent children.

A (all children living with the family are covered even if adopted or born after the insurer issued the policy.) YOUR ANSWER

This statement accurately reflects the typical provisions of a family life insurance policy, which generally extends coverage to all children living with the insured, including those adopted or born after the policy is in effect, without requiring additional premium payments.

B (coverage for children may be converted to permanent insurance but evidence of insurability is required.) CORRECT

This statement is incorrect because, typically, when converting child coverage to permanent insurance, insurers do not require evidence of insurability. This is designed to ensure that children can maintain coverage without going through additional health assessments.

C (there is no additional charge for covering new additions to the family.) YOUR ANSWER

This statement is generally true, as most family life insurance policies allow for the addition of new children without increasing the premium. This feature is designed to accommodate the growing needs of families without financial penalties.

D (the insurance is "term" and for a fixed amount.) YOUR ANSWER

This statement is true, as family life insurance policies are often structured as term insurance, providing coverage for a specified period or until certain conditions are met, typically with a fixed benefit amount.

Conclusion

In summary, a family life insurance policy is designed to provide comprehensive coverage for all eligible children without requiring evidence of insurability for conversion to permanent coverage. While options A, C, and D accurately describe the policy's benefits, option B is misleading regarding the conversion process, highlighting the importance of understanding specific policy terms and conditions.

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