Question 12

Return of premium rider refunds the purchase payments to the beneficiary if the insured dies within a specified time of policy issuance.

The return of premium rider is specifically designed to refund the purchase payments to the beneficiary in the event of the insured's death within a designated period after the policy is issued.

A) other-insured rider

The other-insured rider is an additional coverage option that provides benefits for another individual, typically covering a spouse or child. It does not offer any refunds of purchase payments to beneficiaries in the case of the insured’s death, making it irrelevant to the question.

B) disability income rider

The disability income rider provides income benefits to the insured in the event they become disabled and cannot work. This rider does not pertain to death benefits or refunds of purchase payments, thus it is not the correct choice for this scenario.

C) return of premium rider

The return of premium rider is designed to refund the total premiums paid to the policyholder's beneficiaries if the insured dies within a specified period after the policy is issued. This feature directly aligns with the question's requirement for a refund of purchase payments upon the insured's death.

D) return of cash value rider

The return of cash value rider allows policyholders to receive the accumulated cash value of a permanent life insurance policy if they choose to terminate the policy. However, it does not provide refunds of purchase payments to beneficiaries upon the death of the insured, making it an incorrect answer.

Conclusion

The return of premium rider is the only option that directly addresses the refund of purchase payments to beneficiaries in the event of the insured's death within a specific time frame. All other options either serve different functions or do not relate to the refund of purchase payments, confirming that option C is the definitive correct answer.