If a company accepts a renewal premium payment that extends coverage beyond the policy's maximum age limit, what must the company do?

When a company accepts a renewal premium payment that goes beyond the policy's maximum age limit, it creates an obligation to maintain the coverage for the duration for which the premium has been received. By accepting the payment, the insurer essentially affirms the validity of the contract for that extension period, meaning they must honor the terms of coverage regardless of the age limit that would typically apply.

Accepting the premium indicates the insurer’s acceptance of the risk associated with the policyholder's continued coverage. Therefore, the insurer is legally bound to provide coverage for the period that the premium payment covers, ensuring that the policyholder is not left without protection despite reaching or exceeding the maximum age limit set forth in the original policy terms.

Other options like refunding the premium or terminating the coverage do not align with the principle of honoring the existing contract once the premium has been paid. Similarly, applying additional charges would not be consistent with the acceptance of the premium for the existing coverage. Thus, the correct response reflects the obligation created by the insurer’s actions in accepting the payment.