karmaqh0531 karmaqh0531

23-07-2024
Business

Answered

If an insured continually uses the automatic premium loan option to pay the policy premium:

A. The policy will terminate when the cash value is reduced to nothing.
B. The cash value will continue to increase.
C. The insurer will increase the premium amount.
D. The face amount of the policy will be reduced by the automatic premium loan amount.

Answer :

GinnyAnswer GinnyAnswer

23-07-2024

Final answer:

Continuously using automatic premium loans decreases the policy face amount by the loan amount taken.

Explanation:

If an insured continually uses the automatic premium loan option to pay the policy premium, the face amount of the policy will be reduced by the automatic premium loan amount. This means that the death benefit of the policy will decrease by the loan amount taken, affecting the overall value of the policy.

Learn more about Automatic premium loans in life insurance policies here:

https://brainly.com/question/43615365

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