Survivor Purchase Option
Definition of "Survivor purchase option"
Provision applied as a rider attached to an ordinary life insurance policy for the purpose of meeting estate planning requirements. When the insured dies, the beneficiary is entitled to receive the death benefit in cash or to use the death benefit to purchase a new ordinary life insurance policy. This new policy is not subject to additional underwriting requirements and has, as the date of issue, the same time as the original policy. The initial premium due is automatically subtracted from the original policy's death benefit.
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Additional amount of life insurance above that provided by the employee benefit plan (standard group life plan) that may be chosen by the employee. A limit is usually placed on this maximum ...
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