Alice finds she no longer is able to pay premiums on her $50,000 Whole Life Policy, but needs that amount of protection for her family. Which Nonforfeiture Option provides this protection?

a. fixed amount

b. reduced paid-up

c. paid-up option

d. extended term

The answer is letter d, extended term.

Explanation:

In order to know more about the answer, let's define what "Nonforfeiture Option" is.

Nonforfeiture Option is an option that one can choose instead of simply dropping the insurance policy. It protects the policy owner against total loss of benefits in case of lapsed policy. This only works for Whole Life Policy. So, in the situation above whereby Alice decided not to pay the premiums on her $50,000 Whole Life Policy, she will still be protected through the Nonforfeiture Option called the "extended term." Thus, the answer is letter d, extended term.

Extended Term - This term will give Alice the chance to be covered over a limited period of time upon her failure to pay her premiums.