Assignment task:
Betsy White, aged 45, applies for a universal-life (UL) policy and, while completing the Temporary Insurance Agreement (TIA) part of the application, answered "No" to all the TIA questions, while in fact she had diabetes and had not disclosed the same in the application. Betsy dies in a car accident before the policy is issued, and the TIA is in force. While investigating the claim, the insurer discovers that she had a history of diabetes. Which of the following applies to this beneficiary's claim? A. The insurer will have to pay the TIA amount, because the TIA was in force. B. The insurer will not pay the claim, because there is a material misrepresentation in the application, and a standard policy would not be issued in this case. C. The insurer will adjust the TIA amount based on the charged, had they issued him a rated policy. D. The insurer will have to pay the TIA amount, because it is likely to have issued a standard premium that would have been policy in this case.