Question 15

A Long-Term Care rider may lapse for nonpayment of premium only if the insured and the spouse have failed to purchase a waiver of Premium rider.

A Long-Term Care rider may lapse for nonpayment of premium specifically when the insured and their spouse do not have a waiver of Premium rider in place, which provides additional protection against lapsing due to nonpayment.

A) beneficiary have refused to sign a viatical settlement

This option is incorrect as it pertains to viatical settlements, which are related to life insurance policies rather than Long-Term Care riders. The refusal of a beneficiary to sign a viatical settlement does not influence the premium payment requirements or the conditions under which a Long-Term Care rider may lapse.

B) spouse have failed to purchase a waiver of Premium rider

This option is correct because the existence of a waiver of Premium rider is crucial in preventing lapses due to nonpayment. If the insured and their spouse do not secure this waiver, the Long-Term Care rider is subject to lapse for nonpayment, aligning with the specific terms of the rider.

C) designee fail to pay the premium more than 30 days after the lapse date

This option is incorrect because it misinterprets the conditions under which a Long-Term Care rider may lapse. The responsibility for premium payment primarily lies with the insured and their spouse, and the failure of a designee to pay does not directly correlate with the lapse conditions.

D) assignee are declared mentally competent at the time the payment was due

This option is also incorrect. The mental competency of an assignee does not affect the payment of premiums or the conditions under which a Long-Term Care rider may lapse. The focus is on the insured and their spouse regarding the waiver of Premium rider.

Conclusion

The correct answer is definitive because it directly addresses the specific stipulation regarding the lapse of a Long-Term Care rider due to nonpayment. All other options fail to meet the criteria set forth in the question, as they either pertain to unrelated concepts or misunderstand the responsibilities surrounding the waiver of Premium rider.