All the following provisions must be included in life insurance policies, EXCEPT

• A. Grace period
• B. Conversion provision
• C. Extended Term
• D. Term policies

Answer: (C)

The key idea is that some provisions are standard features in life insurance contracts, while others are optional or only relevant in certain policy types. A grace period is a baseline protection that must be included so the policyholder can pay a late premium and keep the coverage in force. The conversion provision is also a common feature in term policies, allowing the insured to switch to a permanent policy without new underwriting when the term ends. The extended term provision, however, is a nonforfeiture option that depends on having cash value in the policy; it isn’t required to be included in every life policy because not all policies accumulate cash value, and some forms may offer different nonforfeiture choices or none at all. Term policies are a policy type rather than a specific provision, so they’re not something that must be included as a clause in every policy. Therefore, extended term is the provision that isn’t universally required.