Insurance Licensing Updated Virginia-Life-Annuities-and-Health-Insurance Exam Questions and Answers by gracie-mae

When all named beneficiaries predecease the insured, the policy proceeds revert to the insured’s estate. This allows settlement under probate unless otherwise directed by policy terms.

Exact Extract (Virginia Life Insurance Study Guide): “If no living beneficiary is designated at the time of the insured’s death, proceeds are payable to the estate of the insured.”

References (Virginia Documents / Study Guide):

— Virginia Life Insurance Examination Outline, Beneficiary Succession

The "insurance with other insurers" provision, addressed in Virginia Code § 38.2-3514, is a coordination of benefits (COB) mechanism in individual health insurance policies designed to prevent over-insurance and duplicate payments when an insured has multiple policies covering the same loss. This provision allows the insurer to prorate benefits—paying a share based on the total coverage—when certain conditions are met. Option C states that the insurer wasn’t notified prior to the claim of other coverage, which triggers proration. This aligns with standard COB rules: if the insurer isn’t informed of other policies, it may assume primary liability initially but adjust to a pro-rata share upon discovery, ensuring equitable payment across insurers. Option A (within 31 days of renewal) is irrelevant; renewal proximity doesn’t affect benefit coordination. Option B (grace period) relates to premium payment timing, not other insurance, and doesn’t trigger proration. Option D ($2,000 claim threshold) is arbitrary and not a standard condition in Virginia law or study materials for this provision. The study guide likely emphasizes notification as key to COB, as Virginia follows NAIC model regulations requiring disclosure of other coverage (e.g., via application or claim forms). Without prior notice, the insurer applies proration retroactively, making C the correct choice.

Uniform policy provisions are mandated by law and cannot be deleted. Underwriting actions include issuing, rejecting, or adding riders. Exact extract: “Insurers may not delete or alter mandatory uniform provisions.”

Accidental death benefit (ADB) riders pay an additional death benefit if death results from accidental causes. It is not automatically included in every policy and requires an additional premium. Exact extract: “The accidental death benefit rider provides extra coverage in the event of accidental death and is available only by payment of an additional premium.” It does not affect cash values or nonforfeiture options.