Minnesota Life Insurance License Practice Exam

Which rider allows for additional insurance at a specified date or event without evidence of insurability?

1. Waiver of premium rider

2. Guaranteed insurability rider

3. Accidental death benefit rider

4. Term conversion rider

The correct answer is: Guaranteed insurability rider

The guaranteed insurability rider is designed to provide the policyholder the option to purchase additional life insurance coverage at specified intervals or events, such as marriage, the birth of a child, or reaching a certain age, without needing to provide evidence of insurability. This means that regardless of changes in health or other circumstances that could affect insurability, the individual can increase their coverage within the limits set by the rider. This feature is particularly beneficial because it addresses the uncertainty of future health issues. For instance, if a person develops a health condition that would typically make it difficult or even impossible to obtain new life insurance coverage, the guaranteed insurability rider allows them to expand their policy as originally planned. The other options do not provide this same benefit. The waiver of premium rider, for example, waives the premiums if the policyholder becomes disabled, but it does not pertain to acquiring additional coverage. The accidental death benefit rider offers added coverage in the case of death due to an accident but also does not allow for increasing insurance without evidence of insurability. Lastly, the term conversion rider permits the holder of a term life insurance policy to convert their policy to a permanent one but does not focus on supplementing coverage without underwriting.