Question

29 tony applied for a life insurance policy on his life, and his application was approved. he received the final contract from his agent two days ago and paid the first premium. today, tony changed his mind and decided to cancel the contract. he contacts his agent to inform him about his decision and asks if he will get a refund of the premium. which of the following responses will the agent provide?
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a. tony cannot cancel the policy, but he can let it lapse by not making the premium payments.
b. tony will be able to get a refund if he returns the policy for cancellation within 10 days after its issue.
c. tony has a 30 - day free - look period during which he can review the contract and decide if he wants to return it for a full refund.
d. tony can cancel the policy anytime, but he will not be provided with a refund of the premium.
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Explanation:

In life insurance, the "free - look period" is a common provision. During this period (usually around 10 - 30 days depending on regulations), the policyholder can review the policy and decide to return it for a full refund of the premium paid. Option a is incorrect as typically there are provisions for cancellation within the free - look period. Option b is incorrect because the free - look period allows for cancellation with a refund, not just letting it lapse. Option d is incorrect as the free - look period does allow for a refund of the premium if cancelled within that period. So the correct answer is based on the concept of the free - look period in insurance.

Answer:

c. Tony has a 30 - day free - look period during which he can review the contract and decide if he wants to return it for a full refund.