68. The insured and primary beneficiary were in a car accident. The insured was killed instantly; the beneficiary died 10 days later. Which provision protects the rights of the contingent beneficiary?
Answer: B
The common disaster clause protects the rights of the contingent beneficiary.
In situations where both the insured and primary beneficiary die in close succession, the common disaster clause ensures that the contingent beneficiary receives the benefits. This provision is crucial to prevent the primary beneficiary's death from affecting the rightful claim of the contingent beneficiary.
A) Entire contract
The entire contract provision refers to the agreement between the insurer and the insured, which includes all terms and conditions. This option does not specifically address the issue of simultaneous deaths or the rights of contingent beneficiaries, making it irrelevant in this scenario.
B) Common disaster clause
The common disaster clause is designed to address situations where the insured and the primary beneficiary die within a short period of each other, thereby protecting the rights of the contingent beneficiary. In this case, since the primary beneficiary died 10 days after the insured, this clause ensures that the benefits are directed to the contingent beneficiary.
C) Consideration clause
The consideration clause outlines the payment of premiums and the insurer's obligation to provide coverage. While it is an essential part of the insurance contract, it does not pertain to the distribution of benefits upon the deaths of the insured and beneficiary, making it not applicable here.
D) Insuring clause
The insuring clause establishes the insurer's promise to pay benefits under specific conditions. However, it does not address circumstances involving the deaths of the insured and beneficiary in close succession, and therefore, it does not protect the rights of the contingent beneficiary.
Conclusion
The common disaster clause is pivotal in this situation as it provides a mechanism for the contingent beneficiary to receive benefits when both the insured and primary beneficiary die in a short time frame. Other options, such as the entire contract, consideration clause, and insuring clause, do not address the specific issue of beneficiary rights in the event of simultaneous deaths, reinforcing the importance of the common disaster clause in protecting those rights.