The correct answer is D. All of the above.
A lapsed policy is a life insurance policy that has not been paid for in a certain period of time, usually 12 months. If a policy lapses, the insurer may still be willing to revive it, but there are usually certain conditions that must be met. These conditions may include paying back all of the premiums that were missed, plus interest, and/or providing a new medical examination.
Revival of a lapsed policy can be beneficial to both the policyholder and the insurer. For the policyholder, it can mean that they will not have to start over with a new policy, which may have higher premiums. For the insurer, it can mean that they will not have to pay out a death benefit if the policyholder dies while the policy is lapsed.
However, there are also some risks associated with reviving a lapsed policy. For example, if the policyholder’s health has declined since the policy lapsed, they may be required to pay higher premiums or may not be able to get the policy revived at all. Additionally, if the policyholder dies shortly after reviving the policy, the insurer may not pay out the full death benefit.
Overall, whether or not to revive a lapsed policy is a decision that should be made on a case-by-case basis. The policyholder should carefully consider the risks and benefits before making a decision.
Here are some additional details about each option:
- Option A: Revival of a lapsed policy is subject to certain conditions as set out by the underwriter. This means that the insurer may have certain requirements that must be met in order to revive the policy. These requirements may include paying back all of the premiums that were missed, plus interest, and/or providing a new medical examination.
- Option B: Revival of a lapsed policy cannot increase the risk for the insurer. This is because the insurer will have already assessed the risk when the policy was originally issued. However, if the policyholder’s health has declined since the policy lapsed, the insurer may require them to pay higher premiums or may not be able to get the policy revived at all.
- Option C: Fresh medical examination report is not always required for revival of a lapsed policy. This is because the insurer will already have a medical history on the policyholder from when the policy was originally issued. However, if the policyholder’s health has declined since the policy lapsed, the insurer may require them to provide a new medical examination.