Which is an example of the insured's consideration in a policy transaction?

• A. A medical exam
• B. A signed application
• C. A paid Premium
• D. A beneficiary designation

Answer: (C)

In a life insurance contract, consideration is what the insured gives in exchange for the coverage. The essential thing the insured provides is the premium payments, which are the tangible value sustaining the contract. The insurer’s promise to pay benefits is its side of the exchange.

So the paid premium best fits as the insured’s consideration. A medical exam is part of underwriting, not the value exchanged. A signed application documents intent and information but isn’t the consideration by itself. A beneficiary designation determines who receives the payout, but it isn’t the value exchanged for the coverage either.