Question 78

The 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 ensures that if the insured passes away within a designated timeframe after the policy is issued, the total purchase payments made are refunded to the beneficiary.

A) other-insured rider

The other-insured rider is an additional coverage that allows for the inclusion of another individual under the same policy. It does not provide any refund of purchase payments to the beneficiary if the insured dies; rather, it simply extends coverage to another person.

B) disability income rider

The disability income rider provides financial benefits if the insured becomes disabled and unable to work. While this rider offers valuable protection, it does not refund purchase payments to the beneficiary upon the insured's death.

C) return of premium rider

This rider is specifically designed to refund all purchase payments made by the policyholder in the event of the insured's death within a specified period. It directly addresses the question by fulfilling the condition of returning payments to the beneficiary.

D) return of cash value rider

The return of cash value rider allows the policyholder to receive the cash value of the policy upon surrender or at a specified time. However, it does not provide a refund of purchase payments to the beneficiary if the insured dies.

Conclusion

The return of premium rider is the only option that explicitly states it will refund the purchase payments to the beneficiary if the insured dies within a specified timeframe. All other options either provide different types of coverage or benefits that do not include a refund of purchase payments, making them incorrect in this context.