State RegulationsGA specificDifficulty 1/5
An individual life policy issued in Georgia contains a suicide exclusion covering two years from issue. The insured dies by suicide within that two-year period. Under O.C.G.A. § 33-25-5, what must the insurer pay?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Under O.C.G.A. § 33-25-5, a Georgia life policy may exclude liability for death by suicide, sane or insane, within two years of issue — but if the policy contains that exclusion, the insurer must still pay an amount not less than the policy's reserve, computed under the Commissioner's reserve valuation method. Georgia deliberately deviates from the NAIC-model refund-of-premiums approach.
Why the other options are wrong
- A) A refund of premiums paid is the NAIC-model result and a documented distractor; Georgia requires the reserve.
- B) The policy does not void entirely; O.C.G.A. § 33-25-5 mandates a minimum payment of the reserve when the exclusion applies.
- C) The full face amount is not required during the exclusion period — only the reserve minimum.
Memory hook
Georgia pays the reserve, not the premiums.