Life Insurance✓ Verified · outline & fact-checked · Sep 2026Difficulty 2/5
A no-lapse guarantee on a universal life insurance policy provides that:
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
The no-lapse guarantee, also called a guaranteed death benefit or secondary guarantee, ensures that a universal life policy remains in force for a stated period or for life, regardless of how the cash value performs, provided the policyowner pays the required minimum premium on schedule. It addresses the risk that poor credited interest or rising costs could otherwise exhaust the cash value and cause the policy to lapse. The guarantee protects the death benefit, not the cash value.
Why the other options are wrong
- A) The guarantee covers the death benefit, not the cash value; cash value can still decline with unfavorable credited interest.
- B) Universal life premiums remain flexible and may change; the no-lapse guarantee conditions continuation on paying the required minimum.
- C) The guarantee is conditioned on premium payment and does not override the policy's other terms, such as coverage limits.
Memory hook
No-lapse guarantee: keep paying the required minimum and the coverage outlives bad market luck.