State RegulationsNY specificDifficulty 2/5
An insured dies within two years of issue while working at an occupation that the life policy specifically named and excluded as hazardous. Under N.Y. Ins. Law §3203(b)(1)(D), the insurer:
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Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
Under N.Y. Ins. Law §3203(b)(1)(D), when death occurs within 2 years of issue from a hazardous occupation that is named and excluded in the policy, the insurer must return the premiums paid. The insurer may instead attach a graduated table of death benefits, paying reduced amounts for death from the excluded occupation rather than excluding it flatly. The exclusion is limited to the first 2 years after issue.
Why the other options are wrong
- A) Hazardous occupation exclusions are permitted under §3203(b)(1)(D) for death within 2 years of issue from a named, excluded occupation.
- C) The measure of the insurer's obligation is return of premiums or a graduated table under §3203(b)(1)(D), not the cash value.
- D) Forfeiting premiums is not permitted; §3203(b)(1)(D) requires the premiums to be returned when the exclusion applies.
Memory hook
Hazardous occupation death within two years: premiums back - or a graduated table.