In a misstatement of age scenario, the death benefit will be what the premium would have purchased at the correct age.

• A. The death benefit will be what the premium would have purchased at the correct age
• B. The death benefit will be based on the incorrect age
• C. The death benefit will be reduced to zero
• D. The death benefit will be the cash value

Answer: (A)

When age is misstated on a life policy, the death benefit is adjusted to reflect the amount of insurance the premiums paid would have purchased at the insured’s correct age. The premium schedule is based on age, so discovering the true age means recalculating how much coverage those paid premiums would have bought at that age. This ensures the benefit matches the actual risk and protection intended, rather than the incorrect age used in the contract. The cash value isn’t used to determine the death benefit in this scenario, and the benefit isn’t simply reduced to zero unless there’s a separate issue of fraud or policy terms.