PSI Life Exam Practice Test

Which rider allows for additional insurance purchase at specified events without further underwriting?

1. Accelerated death benefit

2. Guaranteed insurability

3. Additional insured rider

4. Conversion rider

The correct answer is: Guaranteed insurability

The guaranteed insurability rider is designed to allow policyholders to purchase additional life insurance coverage at specified intervals or upon certain triggers – such as marriage, the birth of a child, or a significant change in income – without undergoing additional underwriting. This means that the insurer cannot require the policyholder to provide further proof of insurability (like health exams or medical history) at the time of each purchase. This rider is particularly beneficial for individuals who anticipate their insurance needs might increase over time but want the security of knowing they can add coverage without the concern of changes in health status affecting their ability to qualify for additional insurance later. This flexibility provides peace of mind and ensures that policyholders can adapt their coverage in response to life's changes without facing potential barriers from underwriting requirements. The nuances of other options do not align with the characteristics that define the guaranteed insurability rider, which is specifically focused on allowing additional purchases without the underwriting process. For instance, an accelerated death benefit typically allows policyholders to access a portion of the death benefit while still alive under certain conditions, which is not the same as additional coverage. The additional insured rider adds coverage for another person, often requiring their underwriting, and a conversion rider allows for changing a term policy to a permanent