Question

george forgot to pay his monthly life insurance premium that was due march 1. the policy had a face value of $100,000. on march 21, george died. how much will the insurer pay george's beneficiary for this death claim

Answer 1

Answer: An amount equal to the face value of the policy, MINUS the overdue premiums and any interest or late penalties George owed them

Explanation:

Grace Periods are usually included in Life Insurance policies to safeguard the client in question in case they are late with their payment. This means that should they pay within the grace period they will not lose their coverage.

Normally in Life Insurance, a grace period of 30 days is standard. George died 20 days after his due date which meant that he was still under a grace period and so the Insurance company will still pay out to his beneficiaries but they will deduct all monies owed by George.