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Hawaii life provisions, riders and options practice questions

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Section II of the Hawaii Life exam's general part, Life Provisions, Riders, Options, and Exclusions, has 15 of the 50 scoreable general questions. [1] The outline lists riders (waiver of premium, guaranteed insurability, payor benefit, accidental death, term riders, other insureds, long term care, return of premium, disability, cost of living), policy provisions and options (entire contract, insuring clause, free look, consideration, owner's rights, beneficiary designations, premium payment, reinstatement, loans, nonforfeiture options, dividends, incontestability, assignments, suicide, misstatement of age and gender, settlement options, accelerated death benefits) and exclusions for war, aviation and dangerous occupations. [1]

Our Hawaii life flashcards cover Hawaii's grace period, entire contract, incontestability, misstatement of age and reinstatement rules. This page covers the other Hawaii law behind section II, with 10 practice questions.

Exclusions and suicide (HRS 431:10D-108)

A Hawaii life policy may not exclude or restrict liability for death caused in a certain way, except for these listed circumstances: [2]

If an exclusion applies, the policy must still pay at least a reserve amount set by law, adjusted for any debt or dividend credit. A policy also may not limit the time to sue to less than three years after the cause of action arises. These rules do not apply to annuities or to disability and accidental death benefit provisions. [2]

What incontestability does and does not cover (HRS 431:10D-109, 110)

An incontestable clause bars only a contest of the policy's validity. It does not stop the insurer from relying, at any time, on provisions that exclude or restrict coverage. [3] A reinstated policy or annuity may be contested for fraud or material misrepresentation in the reinstatement only for the same period the policy allows after original issue. [4]

Nonforfeiture options (HRS 431:10D-104)

If a premium is in default, the company must grant a paid-up nonforfeiture benefit on request made no later than sixty days after the premium's due date. After premiums have been paid for at least three full years on ordinary insurance, the owner may instead surrender the policy within sixty days of the default for a cash surrender value. If no option is chosen within sixty days, the paid-up benefit named in the policy takes effect. The company may defer paying a cash surrender value for six months after it is demanded. [5]

Policy loans and installments (HRS 431:10D-102)

Once a policy has a cash surrender value and no premium is in default, the insurer will lend up to the loan value, but it may defer a loan, other than one to pay a premium to the insurer, for six months after application. The policy may also provide that unpaid loan interest is added to the debt, and that the policy terminates if total debt including interest equals or exceeds the loan value. The loan provision does not apply to term policies or term riders. [6] A policy that lets proceeds be paid in installments determinable before maturity must include a table of the guaranteed installments. [6]

Free look and replacement

The Insurance Division says you may return a new life policy within ten days of receiving it for a full refund of the premium paid, and warns that replacing a policy may restart the two year contestable period. [7]

Practice questions

1. Which exclusion may a Hawaii life policy contain?

A. Death from any illness in the first year
B. Death as a result of war, declared or undeclared
C. Death from any accident
D. Death in any car crash

Answer: B. (HRS 431:10D-108(b)(1)) [2]

2. How long after issue may a Hawaii life policy exclude suicide?

Answer: Within two years from the date of issue, whether the insured was sane or insane. (431:10D-108(b)(5)) [2]

3. What is the shortest time a policy may allow for filing a lawsuit after the cause of action arises?

Answer: Three years. (431:10D-108(a)) [2]

4. A policy's two year incontestable period has passed. Can the insurer still deny a claim under an aviation exclusion in the policy?

Answer: Yes. Incontestability bars only a contest of validity, not defenses based on exclusions. (HRS 431:10D-109) [3]

5. After a premium default, how long does the owner have to request a paid-up nonforfeiture benefit?

Answer: No later than sixty days after the due date of the premium in default. (HRS 431:10D-104(b)(1)(A)) [5]

6. When must an ordinary life policy offer a cash surrender value on default?

Answer: After premiums have been paid for at least three full years. (431:10D-104(b)(1)(B)) [5]

7. The owner surrenders for cash. How long may the company defer payment?

Answer: Six months after the demand. (431:10D-104(b)(3)) [5]

8. An owner asks for a policy loan to pay a premium due to the insurer. May the insurer defer it for six months?

Answer: No. The six month deferral right does not apply to loans for paying premiums to the insurer. (HRS 431:10D-102(a)(8)(B)) [6]

9. A policy includes Hawaii's optional loan termination wording, and the loan plus unpaid interest grows to equal the loan value. What happens?

Answer: The policy terminates and becomes void. (431:10D-102(a)(8)(B)(ii)) [6]

10. Does Hawaii's required policy loan provision apply to term policies?

Answer: No. The loan provision does not apply to term policies or term insurance benefits provided by rider. (431:10D-102(a)(8)(B)(iii)) [6]

Study tips for section II

Practice more with the free Hawaii life practice test.

Prep Retention is independent and is not affiliated with Pearson VUE or the state.

Sources

Laws and exam documents quoted as of October 2026.

  1. Pearson VUE, Hawaii content outlines 121201 (effective January 1, 2026): https://www.pearsonvue.com/content/dam/VUE/vue/en/documents/publications/121201.pdf
  2. HRS 431:10D-108: https://data.capitol.hawaii.gov/hrscurrent/Vol09_Ch0431-0435H/HRS0431/HRS_0431-0010D-0108.htm
  3. HRS 431:10D-109: https://data.capitol.hawaii.gov/hrscurrent/Vol09_Ch0431-0435H/HRS0431/HRS_0431-0010D-0109.htm
  4. HRS 431:10D-110: https://data.capitol.hawaii.gov/hrscurrent/Vol09_Ch0431-0435H/HRS0431/HRS_0431-0010D-0110.htm
  5. HRS 431:10D-104: https://data.capitol.hawaii.gov/hrscurrent/Vol09_Ch0431-0435H/HRS0431/HRS_0431-0010D-0104.htm
  6. HRS 431:10D-102: https://data.capitol.hawaii.gov/hrscurrent/Vol09_Ch0431-0435H/HRS0431/HRS_0431-0010D-0102.htm
  7. Hawaii Insurance Division, Life Insurance: https://cca.hawaii.gov/ins/life-insurance/

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