South Carolina Life and Health Practice Exam

Which insurance feature provides coverage for a specific type of event like accidental death?

1. Accidental death benefit

2. Convertibility feature

3. Disability income rider

4. Living benefits

The correct answer is: Accidental death benefit

The accidental death benefit is a specific feature within some life insurance policies that provides an additional payout if the insured person dies as a result of an accident. This benefit is designed to offer extra financial support to the beneficiaries during a time of loss, addressing the heightened financial risks associated with accidental death compared to deaths from natural causes or illnesses. This feature highlights the insurance industry's ability to customize coverage based on particular risks, allowing policyholders to choose additional benefits that align with their specific needs or concerns. An accidental death benefit typically pays a predetermined amount, which is often in addition to the standard death benefit, providing significant peace of mind for policyholders who want to ensure their loved ones are adequately protected in the event of such unforeseen occurrences. Other options do not directly pertain to providing coverage specifically for accidental death. The convertibility feature allows policyholders to change their term life insurance policy into a permanent one without providing evidence of insurability, while a disability income rider provides income replacement if the policyholder becomes disabled and cannot work. Living benefits refer to features that allow policyholders to access part of their death benefit while still alive under certain conditions, which is not focused on accidental death coverage.