Question

why is the policy issue date important? *
it determines the insured age
it starts the contestability and suicide periods
it establishes the beneficiary
it determines the face amount

if the insured dies during the grace period before the premium is paid, the insurer will: *
deny the claim
pay the claim minus the unpaid premium
pay only cash value
refund premiums

a life insurance policy lapses when:
the insured dies
cash value reaches zero
premiums are not paid by the end of the grace period
a loan is taken

Explanation:

1. For the first question: The policy issue date marks the start of time-sensitive clauses like contestability (where the insurer can challenge policy validity) and suicide periods (where suicide claims are restricted). Other options are incorrect: insured age is determined by birth date, beneficiary is set by the policyholder, and face amount is chosen when purchasing the policy.
2. For the second question: The grace period is a window where coverage remains active after a missed premium. If the insured dies during this time, the insurer pays the death benefit but subtracts the unpaid premium amount. Denying the claim, paying only cash value, or refunding premiums do not align with standard grace period rules.
3. For the third question: A policy lapses when the policyholder fails to pay premiums by the end of the grace period, resulting in a loss of active coverage. The insured's death triggers a claim, a cash value of zero is not the standard lapse trigger, and taking a loan against the policy does not cause a lapse.

Answer:

1. It starts the contestability and suicide periods
2. Pay the claim minus the unpaid premium
3. Premiums are not paid by the end of the grace period