New York Insurance Exam Practice Question
What is the purpose of a policy's free-look period?
Correct Answer: B
Rationale: The free-look period allows policyholders to review their insurance policy after purchase and return it for a full refund if they are unsatisfied. This ensures that individuals have the opportunity to thoroughly understand their coverage before committing financially.
Option A, waiving premiums, is incorrect as the free-look period does not eliminate the need for premium payments. Option C, increasing the death benefit, misrepresents the free-look period's function, which is not related to altering policy benefits. Option D, canceling the policy automatically, is misleading; the policyholder must actively choose to return the policy during the free-look period.
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