Florida 2-15 Life, Health and Variable Annuity AgentFlorida Laws and Regulations Specific to Life Insurance and AnnuitiesHard
A Florida resident is reviewing their whole life insurance policy and notices a clause that states if the insured misrepresents their age, the insurer will adjust the policy's benefits or premiums to reflect what would have been purchased at the correct age. What is this clause known as?
- AGrace Period Provision
- BReinstatement Clause
- CMisstatement of Age or Sex Clause
- DIncontestability Clause
Show answer & explanationAnswer & explanation
Correct answer: C. Misstatement of Age or Sex Clause
The Misstatement of Age or Sex Clause is a standard life insurance provision that allows the insurer to adjust policy benefits or premiums if the insured's age or sex was incorrectly stated on the application, rather than voiding the policy.
Why the other options are wrong
- A. This provision provides extra time for premium payments before policy lapse.
- B. This clause allows a lapsed policy to be restored under certain conditions.
- D. This clause prevents the insurer from voiding the policy after a certain period, but doesn't specifically address age misstatement adjustment.
Misstatement of Age or Sex Clause
A provision in a life insurance policy that allows the insurer to adjust the policy's face amount or premium to what the correct age or sex would have purchased, rather than voiding the policy.
- Adjusts benefits/premiums, does not void policy
- Applies to misstatements of age or sex
- Standard life insurance provision
Memory trick: Misstatement of Age: 'Age' is 'adjusted', not 'canceled'.