Which of the following statements regarding a life insurance policy dividend is TRUE?

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Which of the following statements regarding a life insurance policy dividend is TRUE?

A) It represents a refund of overcharged premium in a non-participating whole life policy
B) It represents the build-up of cash value in a permanent insurance policy
C) It is the distribution of excess of funds accumulated by the insurer on participating policies
D) It is a stockholders return on his investment to the company

Answer: C) It is the distribution of excess of funds accumulated by the insurer on participating policies

Basic Principles

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An insured's building has an actual cash value of $200,000, and he has insured the property for $120,000 with an 80% coinsurance clause. A $40,000 loss occurs. How much will the policy pay?

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In insurance,

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