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Question

What does the term "Surrender Value" signify in the context of insurance policies?

A The sum assured by the insurance company upon the policyholder's demise. Correct Answer Incorrect Answer
B A refund of premiums to policyholders who have maintained their policies for the entire duration. Correct Answer Incorrect Answer
C An amount paid to policyholders who wish to terminate their policy prematurely, subject to a calculated reduction. Correct Answer Incorrect Answer
D Additional compensation provided to policyholders who opt for a partial withdrawal from their policy's accumulated funds. Correct Answer Incorrect Answer
E None of the above Correct Answer Incorrect Answer

Solution

Explanation: Surrender Value pertains to the sum paid to policyholders who opt to terminate their insurance policy before its designated maturity date. However, this payout is not the full premium paid; it undergoes a calculated reduction that considers factors such as the policy's duration and the premiums paid. This complex concept reflects the intricate dynamics of policy termination and its financial implications.

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