L&HIllinoismedium
Under 50 Ill. Adm. Code 1406, which statement about life insurance policy illustrations delivered to Illinois applicants is correct?
AIllustrations may guarantee non-guaranteed values if presented in good faith
BIllustrations are optional and need not be retained by the insurer
Insurers must clearly label which values are guaranteed and which are non-guaranteed, and the applicant must sign the illustration at or before policy delivery
DOnly universal life policies require an illustration
Why this is the answer
Illinois's life illustration rule, 50 Ill. Adm. Code 1406, adopts the NAIC Life Insurance Illustrations Model. Insurers must clearly distinguish guaranteed values (mortality and expense based on policy minimums) from non-guaranteed elements (current dividend scale, current credited rate, current charges). The applicant must sign a copy of the illustration acknowledging receipt at or before delivery, and the insurer must retain it for IDOI inspection.
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