Lionel purchased a $200,000 ordinary life insurance policy when he was 25 years old and had significant life insurance needs.Now Lionel is 50.His mortgage is almost paid-off and his children have left home and are financially independent.Lionel no longer wants to pay premiums,but he would like to have some permanent life insurance in force.Which nonforfeiture option could Lionel employ to meet these objectives?

Question

Quizplus · Accepted Answer

Reduced paid-up insurance will allow Lionel to stop paying premiums and maintain the policy with a reduced death benefit. This option uses the policy's cash value to purchase a paid-up policy with a lower death benefit than the original policy. This option will allow him to have some permanent life insurance without having to continue to pay premiums.

Lionel Purchased a $200,000 Ordinary Life Insurance Policy When He