Arkansas Life and Health Insurance Practice Exam

Which provision is an Optional Uniform Provision?

1. Grace Period

2. Incontestability

3. Misstatement of Age

4. Relation of Earnings to Insurance

The correct answer is: Grace Period

The Grace Period provision is considered an Optional Uniform Provision because it gives policyholders additional time to pay their premiums after the due date without the risk of policy lapse. This provision is not required by law but is commonly included in insurance policies to provide some leniency to the insured in case of financial difficulties. In contrast, the Misstatement of Age provision, Incontestability provision, and Relation of Earnings to Insurance provision are mandatory provisions that must be included in all policies to protect the interests of the insured and regulate the insurance industry.