Massachusetts Life Producer Practice Exam

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Study for the Massachusetts Life Producer Exam. Use flashcards and multiple-choice questions with detailed hints and explanations. Prepare effectively for your exam with confidence!

Practice this question and more.

How long can an insurer legally defer paying the cash value of a surrendered life insurance policy?

3 months
6 months
9 months
12 months

The correct answer is: 6 months

The correct answer is that an insurer can legally defer paying the cash value of a surrendered life insurance policy for a maximum of 6 months. This provision is put in place to protect the insurer from an immediate payout that could significantly impact their financial stability, while still ensuring that policyholders have a reasonable expectation of receiving their cash value in a timely manner. This 6-month waiting period is a standard timeframe outlined in insurance regulations, allowing insurers to manage their liabilities effectively while also providing a safeguard for policyholders. Recognizing that policyholders might need access to their cash value for various reasons, the legally mandated period ensures that they are not left in a prolonged state of uncertainty regarding their funds.