Practice question
A policy’s premium depends on final audited activity during the term. It states the agreed basis and rates for computing the final premium. An objection says Section 51 always requires a fixed final number at inception despite that insurance character. Which is correct?
- Every variable premium is categorically illegal
- The insurer may instead omit all calculation terms
- Only a later verbal demand may set it
- The section expressly accommodates the stated basis-and-rates approach
- The policy automatically becomes life insurance
Legal references
- Insurance Code as amended by RA 10607: https://lawphil.net/statutes/repacts/ra2013/ra_10607_2013.html; Section 51.
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