What is true about a guaranteed renewable policy?

What is true about a guaranteed renewable policy?

• A. Premiums are guaranteed for life.
• B. Renewability is guaranteed without proof of insurability, to a stated age, but premiums are not guaranteed.
• C. The insurer can cancel at any time without reason.
• D. Renewability is guaranteed and premiums are fixed for life.

Answer: (B)

Guaranteed renewable means you have the right to renew the policy to a specified age without needing to prove you're insurable, and the insurer cannot cancel the policy for health reasons. However, at each renewal the insurer can raise the premium, and those future premiums aren’t guaranteed to stay the same. This matches the statement that renewability is guaranteed to a stated age, but premiums are not guaranteed. In contrast, some policies keep premiums fixed for life or allow cancellation, which isn’t how guaranteed renewable policies work.

Guaranteed renewable means you have the right to renew the policy to a specified age without needing to prove you're insurable, and the insurer cannot cancel the policy for health reasons. However, at each renewal the insurer can raise the premium, and those future premiums aren’t guaranteed to stay the same. This matches the statement that renewability is guaranteed to a stated age, but premiums are not guaranteed.

In contrast, some policies keep premiums fixed for life or allow cancellation, which isn’t how guaranteed renewable policies work.