Oklahoma Life Producer Practice Exam

Which type of term life insurance typically requires a medical exam for renewal?

1. Level Term Policy

2. Renewable Term Policy

3. Decreasing Term Policy

4. Non-renewable Term Policy

The correct answer is: Non-renewable Term Policy

The correct answer is that a non-renewable term policy typically requires a medical exam for renewal. Non-renewable term life insurance policies provide coverage for a set period without the option to extend the policy once it expires. Because these policies lack renewal provisions, if an individual wishes to obtain new coverage after the term ends, they often must undergo a medical exam and qualify based on their current health status for the new policy. This requirement stems from the nature of non-renewable support, which does not provide a seamless transition or guarantee of coverage beyond the initial term. Insurers often request a medical exam to reassess risk factors, especially if there has been a significant lapse in coverage. This approach helps ensure that the insurer accurately evaluates the applicant's health at the time of reapplication. Understanding this concept is crucial for life insurance producers, as it underscores the importance of educating clients about the implications of policy types and health assessments related to term life insurance.