State RegulationsIL specificDifficulty 1/5
Under the Illinois rules governing life insurance illustrations, what is an illustration?
Select an option to reveal the answer and the full 3-part explanation — free, no signup.
Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
50 Ill. Adm. Code 1406 governs life insurance illustrations, and an illustration is a presentation or depiction of how a policy's benefits and values would be determined over time. Its defining feature is that it may include non-guaranteed elements such as projected dividends or crediting rates, which is exactly why Illinois regulates how illustrations are prepared and presented.
Why the other options are wrong
- A) An illustration does not amend or alter the contract; the policy and its endorsed application remain the entire contract.
- C) Illustrations are not limited to guaranteed figures; the projection of non-guaranteed elements is what triggers regulation under 50 Ill. Adm. Code 1406.
- D) A claim form has no relationship to the illustration rules; illustrations are sales-presentation documents.
Memory hook
An illustration shows the math — including the parts not guaranteed.