Ace the Florida Life & Health Insurance Test 2025 – Dive In and Secure Your Success!

Question: 1 / 400

The Consideration clause in a life insurance policy indicates that a policyowner's consideration consists of what?

A legal document

The initial premium and a completed application

A life insurance policy is a contract between the policyowner and the insurance company. The Consideration clause states what the policyowner must provide in order to receive insurance coverage. Option A is incorrect because a legal document is not considered as the policyowner's consideration. Option C is incorrect because a monthly premium is only a periodic payment and does not reflect the initial agreement between the policyowner and the insurance company. Option D is incorrect because an annual statement is simply a report of the policy's status and does not constitute the policyowner's consideration. Only option B, the initial premium and a completed application, fulfills the requirements of the Consideration clause. This means that the policyowner must pay the initial premium and submit a completed application in order to receive insurance coverage.

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A monthly premium

An annual statement

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