State RegulationsNC specificDifficulty 2/5
A producer in Greensboro is handling a life insurance replacement. Under 11 NCAC 12 .0612(a)(4), what return right must the replacing insurer give notice of?
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Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
Under 11 NCAC 12 .0612(a)(4), in a replacement the replacing insurer must notify the applicant of the right to return the policy within 30 days of delivery for an unconditional full refund of all premiums and considerations, including policy fees. The 30-day right applies only to replacements; the standard free look is 10 days.
Why the other options are wrong
- A) Ten days is the standard free-look period, not the enhanced right given in replacement transactions.
- C) Thirty-one days is the life grace period figure, and a refund less fees contradicts the unconditional full-refund standard.
- D) Sixty days is not a return period under the rule, and the replacement refund is not limited to cash surrender value.
Memory hook
Replacement stretches the free look to 30 days — fully refunded.