What is usually payable to the beneficiary if the insured dies during the grace period of an unpaid life insurance policy?

In the event of the insured's death during the grace period of an unpaid life insurance policy, the beneficiary is typically entitled to the full face amount of the policy, minus any unpaid premiums. This is because the coverage remains in force during the grace period, which is a time allowance provided by the insurer for the policyholder to pay any overdue premiums without losing the policy benefits.

The grace period is intended to give policyholders a last chance to maintain their coverage. If the insured passes away during this time, the insurer will first account for any premiums that were owed and deduct that amount from the face value of the policy before disbursing the benefits to the beneficiary. This practice ensures that the insurance company can recoup any unpaid risks while still honoring the coverage that was in effect leading up to the insured's death.

The choice of the full face amount reflects the intention to provide the beneficiary with the maximum benefit possible while also addressing the outstanding obligation related to unpaid premiums. Hence, the correct answer aligns with standard industry practices regarding death benefits during the grace period.