What will happen if an insured allows his whole life policy to lapse and does not tell the insurer what to do with the cash value in the policy?

a. The insurer can convert the cash value of the policy to its capital assets account if the money is not claimed within three years.

b. The insurer will send a check for the entire amount minus any outstanding loans to the insured.

c. The insurer will use the cash value as a single premium payment to purchase a paid-up whole life policy for the amount of insurance that the cash value will buy.

d. The insurer will convert the policy to a term policy with a face amount equal to the original policy's face amount with the term of the policy as long as will be bought by the original policy's cash value.

Answer: D