State RegulationsOH specificDifficulty 1/5
How does a return-of-premium feature on a term life policy operate?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
A return-of-premium term policy or rider promises that if the insured outlives the level term period, the insurer returns some or all of the premiums paid; if the insured dies during the term, the full death benefit is paid instead. The trade-off is a higher premium than plain term, and the product's form is subject to Ohio's policy-form filing framework (ORC 3915.14).
Why the other options are wrong
- B) Death during the term triggers the death benefit, not a premium refund in place of it.
- C) Early surrender typically returns little or nothing; the return-of-premium promise applies at the end of the term period.
- D) Annual dividends relate to participating policies, not the return-of-premium refund feature.
Memory hook
Outlive the term, take the premiums home.