State RegulationsFL specificDifficulty 1/5
Which of the following is NOT a nonforfeiture option in a Florida life policy?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Under Chapter 627, Florida Statutes, the nonforfeiture options are cash surrender, reduced paid-up insurance, and extended term insurance. The automatic premium loan is a different creature entirely: it is a feature of the policy loan provision under Fla. Stat. 627.458 that borrows against cash value to pay overdue premiums and keep the original policy in force. It preserves the policy by creating debt, not by forfeiting and re-issuing coverage.
Why the other options are wrong
- A) Cash surrender is the classic nonforfeiture option that ends coverage for its net value.
- B) Reduced paid-up insurance is a nonforfeiture option buying smaller permanent coverage.
- C) Extended term insurance is a nonforfeiture option keeping the same face amount as term.
Memory hook
Loan is debt, not forfeiture - APL is not on the nonforfeiture list.