Nazim is an insurance agent. On March 1st, Nazim meets with Pius and determines that Pius is currently uninsured. At Nazim’s recommendation, Pius meets with him the following day to complete an application for a Term 10 life insurance policy with a face value of $500,000. The application names Pius’s wife, Lynette, as beneficiary. While completing the application, Nazim also suggests a temporary insurance agreement (TIA). The TIA is limited to 2 months, for an amount equal to 40% of the face value of the policy, to a maximum of $250,000. Subsequently, on April 1st, the Term 10 policy is issued. Which of the following statements about Pius’ policy is CORRECT?

If Pius dies on March 15th, Lynette will receive $250,000.

If Pius dies on April 15th, Lynette will receive $700,000.

If Pius commits suicide on April 20th, Lynette will receive $0.

If Pius does not die during the insured period, the TIA expires on May 2nd.

Answer rating: 100% (QA)

The TIA is offering the insurance application for a temporary ... View the full answer