Insurance Awareness - Life Insurance - LIC
Which of the following statements correctly describes the treatment of a life insurance claim if the policyholder dies during the grace period?
Which of the following statements correctly describes the treatment of a life insurance claim if the policyholder dies during the grace period?
hard Q9 of 15
Step-by-Step Solution
Step 1: Understand the grace period concept
The grace period is an extension of time after the premium due date during which the policy remains in force.Step 2: Apply grace period rule to death claims
If the policyholder dies during the grace period, the claim is admissible because the policy is considered active.Step 3: Adjust for unpaid premium
The insurer pays the claim amount after deducting the unpaid premium from the proceeds.Final Answer:
The claim is paid after deducting the unpaid premium → Option BQuick Check:
Death during grace period = claim payable minus unpaid premium.
Quick Trick: Grace period death claim = Pay claim, deduct premium.
Common Mistakes:
MISTAKES- Assuming unpaid premium during grace period leads to automatic claim rejection.
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