Life License Qualification Program (LLQP) Practice Exam

Which of the following is NOT a right granted to a policyholder?

1. Surrendering the policy's cash value

2. Modify a provision in the insurance contract

3. Assignment of ownership

4. Change the beneficiary, if revocable

The correct answer is: Modify a provision in the insurance contract

The correct answer is the modification of a provision in the insurance contract, as this is generally not a right granted to a policyholder. Policyholders have the ability to manage and utilize certain features of their policies, such as surrendering the policy for its cash value, assigning ownership rights, and changing beneficiaries, provided those actions comply with the terms set forth in the policy. However, modifying a provision in the insurance contract typically requires agreement from the insurer. The terms outlined in the contract represent a legal agreement between both the policyholder and the insurer, and any changes usually necessitate formal amendment or endorsement by the insurer. This ensures that both parties consent to the specific language and implications of the insurance agreement. Surrendering the cash value, assignment of ownership, and changing a revocable beneficiary are all actions that policyholders can typically perform within the established framework of their policies. Each of these actions signifies the policyholder's control over their policy within the limits defined by the insurance company, while altering contract provisions usually does not fall into this category of rights without the insurer's approval.