Free Oklahoma Life Insurance Practice Exam Online

Correct answer: C. One month, but not less than 30 days

Correct. Section 4003 requires a grace period of one month, but not less than 30 days, during which the policy stays in force even though the premium is overdue.

• A: Incorrect. Oklahoma law mandates a grace period even for monthly-premium policies; it is not left to insurer discretion.
• B: Incorrect. Seven days is far shorter than the statutory minimum grace period for a monthly-premium life policy.
• D: Incorrect. Six months substantially overstates the statutory grace period requirement.

Correct answer: D. The policy remains in force for the death claim, and the insurer may deduct the overdue premium from the proceeds

Correct. Section 4003 keeps the policy in full force during the grace period; if a claim arises during that time, the insurer may deduct the overdue premium from the death benefit rather than denying the claim outright.

• A: Incorrect. The policy is still in force during the grace period, so a death during that window is not treated as an automatic denial for lapse.
• B: Incorrect. The beneficiary does not forfeit the benefit; the claim is paid, reduced by the unpaid premium amount.
• C: Incorrect. There is no posthumous medical exam requirement tied to the grace period provision; the policy simply remains in force through the grace period.

Correct answer: B. Return the amount of all premiums paid, since the death occurred within two years of policy issue

Correct. Under 36 O.S. § 4024, if death results from suicide within two years from the date of policy issue, the insurer's obligation is limited to returning the amount of all premiums paid.

• A: Incorrect. Oklahoma law permits a two-year suicide exclusion in life policies; it is not the case that suicide is never addressed by the contract.
• C: Incorrect. The statute requires the insurer to return premiums paid, not simply deny the claim and return nothing.
• D: Incorrect. There is no statutory 50% compromise payment; the specified remedy is a return of premiums paid.

Correct answer: B. The full face amount of the policy, since the death occurred after the two-year suicide exclusion period

Correct. Once the two-year suicide exclusion period under 36 O.S. § 4024 has passed, the policy pays the full death benefit the same as for any other cause of death, subject to the policy's other terms.

• A: Incorrect. Suicide is not permanently excluded; the exclusion in Oklahoma's standard provision is limited to the first two years after issue.
• C: Incorrect. The premium-refund-only remedy applies specifically to deaths within the two-year window, not after it has passed.
• D: Incorrect. After the exclusion period expires, the beneficiary is entitled to the full death benefit, not merely the cash value.

Correct answer: D. After the policy has been in force during the insured's lifetime for a specified period (typically two years), the insurer generally cannot contest it based on application misstatements, apart from statutory exceptions such as fraud

Correct. Section 4004's incontestability provision bars the insurer from contesting the policy based on application misstatements once the policy has been in force during the insured's lifetime for the specified period, generally two years, subject to recognized exceptions like fraud.

• A: Incorrect. The whole purpose of an incontestability clause is to cut off the insurer's ability to contest indefinitely; it is not an unlimited right.
• B: Incorrect. This describes the opposite of what incontestability accomplishes; the clause is meant to prevent contests long after issue, not preserve them indefinitely.
• C: Incorrect. Incontestability provisions are a standard feature of individual life policies in Oklahoma, not limited to group policies.