Question

An insured and his wife are both involved in a head-on collision. The husband dies instantly, and the wife dies 15 days later. The company pays the death benefit to the estate of the insured. This indicates that the life insurance policy had what provision?

A Common Disaster
B Accidental Death
C Survivor Life
D Second-to-Die

Answer 1

The policy included a Common Disaster provision, ensuring the death benefit is paid out according to the insured's wishes even if both the policyholder and spouse die closely in time due to the same event.

Step-by-step explanation:

The life insurance policy in question likely included a Common Disaster provision. This provision is designed to provide protection in situations where the policyholder and a secondary insured, such as a spouse, die within a short period of time from the same event.

The purpose is to ensure that the benefits from the policy are distributed in accordance with the insured's wishes, often to the contingent beneficiaries, should the primary beneficiary also perish in the same event.