PSI Life Exam Practice Test

What happens to coverage under a children term rider when a child reaches a specified age?

1. Coverage continues with increased premium

2. They are converted to a permanent policy

3. They are eliminated from coverage

4. They retain coverage with reduced benefits

The correct answer is: They are eliminated from coverage

When a child reaches a specified age specified in the children's term rider, the coverage under this rider is typically eliminated. Children's term riders are designed to provide life insurance coverage for a policyholder's children until they reach a certain age, often around 18 or 21. Once this age is reached, the rider generally terminates and the coverage is no longer in effect. This approach allows the policyholder to provide temporary coverage during the children’s early years, but it does not continue indefinitely. While there may be options available in some policies to convert to a permanent policy or retain benefits in a different form, standard practice for a children's term rider is to cease coverage entirely once the specified age is reached. This ensures that the policy only covers children during the defined term of the rider, after which they may seek their own life insurance if needed.