A whole life policy option where extended term insurance is selected is called a(n)

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Study for the Louisiana Series 103 – Life, Health, and Accident or Sickness Insurance Exam. Familiarize yourself with key concepts through engaging questions and explanations. Prepare effectively for your exam!

Multiple Choice

A whole life policy option where extended term insurance is selected is called a(n)

Explanation:
Nonforfeiture options are what you choose when a policy lapses because premiums aren’t paid. They let you keep some value instead of losing everything. Extending term insurance is one of these options: the policy’s cash value is used to buy term coverage for as long as that value allows, keeping the death benefit (original amount) for that term. So the overall category is a nonforfeiture option, with extended term being the specific form within that category. The other nonforfeiture forms—cash surrender and reduced paid-up—are different ways to use the cash value.

Nonforfeiture options are what you choose when a policy lapses because premiums aren’t paid. They let you keep some value instead of losing everything. Extending term insurance is one of these options: the policy’s cash value is used to buy term coverage for as long as that value allows, keeping the death benefit (original amount) for that term. So the overall category is a nonforfeiture option, with extended term being the specific form within that category. The other nonforfeiture forms—cash surrender and reduced paid-up—are different ways to use the cash value.

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