State RegulationsNC specificDifficulty 1/5
A North Carolina life policy limits suicide benefits for a period after issue. The insured dies by suicide within that window. Under G.S. 58-58-22(4), what is the minimum the insurer must return?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
Under G.S. 58-58-22(4), a policy may limit suicide benefits for no more than two years after issue, and during that window the insurer must at least return the premiums paid. North Carolina refunds premiums paid during the limitation window; a reserve-based formula is not the North Carolina standard.
Why the other options are wrong
- A) Returning the reserve value is not North Carolina's rule; the statute requires at least the premiums paid.
- B) The full face amount is payable only after the permitted limitation period expires, not during it.
- D) Suicide is not an absolute exclusion; the statute caps the limitation period and guarantees a minimum return of premiums.
Memory hook
NC suicide window: two years, then premiums back — not reserve value.