Pennsylvania Life and Health Insurance Exam Practice Question
Which of the following is a provision in an interest-sensitive life policy which allows the policyowner to withdraw the policy's cash value interest free?
Correct Answer: D
Rationale: In an interest-sensitive life policy, a **Partial Surrender** allows the policyowner to withdraw cash value without incurring interest charges, making it a flexible option for accessing funds.
**A: Spendthrift Clause** protects the policy's proceeds from creditors but does not pertain to cash value withdrawals.
**B: Waiver of Premium** provides a means to keep the policy active if the policyowner becomes disabled, but it does not involve cash value access.
**C: Automatic Premium Loan** allows for the borrowing of cash value to cover premiums, but it incurs interest on the loan amount. Thus, only Partial Surrender offers interest-free access to cash value.
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