New Jersey Life Producer Law Practice Test

The correct choice identifies typical exclusions found in a life insurance policy. Most life insurance policies specifically stipulate exclusions to clarify situations where the insurer will not pay out a claim.

Suicide within the contestable period is a common exclusion because insurers usually want to avoid claims that arise from a policyholder intentionally ending their life shortly after obtaining coverage. This period typically lasts for the first two years of the policy. During this time, the insurance company closely scrutinizes claims to prevent potential abuse of the policy.

Acts of war are also commonly excluded due to the unpredictable nature and potential catastrophic losses associated with wartime scenarios. Insurance companies generally do not want to risk significant financial exposure from events that are beyond the control of the policyholder.

Illegal activities are another standard exclusion since engaging in unlawful acts often increases the risk profile of the insured individual. If a policyholder is involved in illegal activities at the time of death, insurers commonly deny claims as a way to mitigate risks associated with providing coverage.

The other options would typically not be considered standard exclusions in life insurance policies. For example, while health conditions might influence underwriting, they would not necessarily be outright exclusions. Unemployment and disability are more related to health or income protection policies rather than life insurance, and accidental deaths