Florida Life and Health Insurance License Practice Test

What type of Disability Income policy cannot be cancelled or have its premiums increased by the insurance company?

1. Renewable

2. Convertible

3. Noncancellable

4. Guaranteed renewable

The correct answer is: Noncancellable

Noncancellable is the type of Disability Income policy that cannot be cancelled or have its premiums increased by the insurance company. This means that the policy will remain in effect as long as the premiums are paid and the terms of the policy are met, providing a sense of security for the policyholder. Renewable policies allow for the policy to be renewed, but the premiums can still be increased by the insurance company. Convertible policies allow for the policy to be converted into another type of policy, but the terms and premiums may change. Guaranteed renewable policies guarantee the policy can be renewed, but the premiums can still be increased. Therefore, noncancellable is the only option where the insurance company has no ability to cancel the policy or increase premiums.