An insured arranges for his premium payment to cease at the age of 70. This is a whole life policy with
Answer Details
The insured in this scenario has arranged for their premium payments to stop at age 70 for a whole life insurance policy. This means that the policy will remain in effect for the insured's entire life, and the death benefit will be paid out to their beneficiaries upon their death.
The type of premium payment arrangement that best fits this scenario is limited premium payment. This is because with a limited premium payment policy, the insured agrees to pay premiums for a specified period of time (in this case, until age 70), after which they no longer have to make premium payments but the policy remains in force.
An indeterminate premium payment policy does not have a set premium payment period, while a single premium payment policy requires the insured to make a one-time lump sum payment at the beginning of the policy. A modified premium payment policy allows for flexibility in premium payments, but typically still requires payments beyond a certain age or for a certain period of time.