Nothing is payable to the policyholder
Excess amount (subsisting cash value after deducting loan/interest) is payable
Notice has to be given to the policyholder by the insurer
None of the above
Answer is Right!
Answer is Wrong!
The correct answer is: A. Nothing is payable to the policyholder.
When a life insurance policy is foreclosed, the insurer takes possession of the policy and any cash value that has accumulated. The insurer then uses this money to repay the loan, plus interest. If there is any money left over, it is returned to the policyholder. However, if the loan amount is more than the cash value of the policy, the policyholder will not receive anything.
Option B is correct. If there is any money left over after the loan is repaid, it is returned to the policyholder.
Option C is correct. The insurer must give the policyholder notice of foreclosure before taking possession of the policy.
Option D is incorrect. Option A is the only incorrect option.