Which of the following statements is true concerning return of premium term insurance?
I.The protection provided while the term insurance was in force was free.
II.The premium returned does not include the cost of any riders or loadings if the insured was a substandard risk.

Question

Quizplus · Accepted Answer

While the premium returned in return of premium term insurance does include the cost of the base policy, it does not include any extra charges such as riders or loadings applied to substandard risks. Option I is incorrect because the protection provided during the term was not free, rather the cost was included in the premium paid by the insured.

Which of the Following Statements Is True Concerning Return of Premium