State RegulationsAZ specificDifficulty 2/5
Which statement correctly describes coverage under an Arizona individual life policy during the grace period?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
A.R.S. 20-1203 requires the grace period in every life policy for premiums after the first, and coverage continues in force during that window. The insurer's remedy for a claim arising in grace is simply to deduct the overdue premium from the payment. Evidence of insurability belongs to reinstatement after lapse, not to the grace window.
Why the other options are wrong
- A) the policy does not lapse at the due date; the grace period protects continuity.
- B) evidence of insurability is a reinstatement requirement, not a grace-period condition.
- D) grace applies to premiums after the first, which is the opposite of this statement.
Memory hook
Grace keeps the policy alive.