Primerica Life Producer Practice Test

When will the accelerated benefits provision allow for early payment of the death benefit?

1. When the policyholder retires

2. When the insured becomes terminally ill

3. After missing a premium payment

4. When the insured reaches age 65

The correct answer is: When the insured becomes terminally ill

The accelerated benefits provision in a life insurance policy is designed to provide early payment of the death benefit to the policyholder under specific circumstances, primarily when the insured person becomes terminally ill. This provision allows the insured to access a portion of the death benefit while still alive, which can be used to cover medical expenses, debt, or to improve the quality of life during their remaining time. This provision is especially crucial for individuals facing a terminal illness, as it offers financial relief in difficult times, and enables them to make decisions about their care or expenses. It recognizes that medical treatments can be expensive, and having early access to funds can alleviate some financial burdens. The other options do not align with the purpose of the accelerated benefits provision. Retirement, missed premium payments, and reaching a specific age like 65 do not trigger the early benefit payment; those situations are not connected to a terminal illness and therefore do not warrant acceleration of the death benefit under this provision.