Pennsylvania Life and Health Insurance Exam Practice Question
Backdating on a life insurance policy is the practice of
Correct Answer: B
Rationale: Backdating on a life insurance policy involves making the policy effective on an earlier date than the present, which allows the insured to secure a lower premium based on their age at that earlier date.
Option A is incorrect as it refers to accepting premiums after the grace period, which does not relate to backdating. Option C misrepresents backdating by discussing exclusions for preexisting conditions, which pertains to health insurance rather than life insurance. Option D describes the reinstatement of a lapsed policy, a separate process that does not involve changing the policy's effective date.
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