A limited-pay whole life insurance policy with a short premium paying period (e.g., 10 years) runs the risk of becoming a “MEC” (Modified Endowment Contract) if:
a. the insured pays the full annual premium and dividends are applied as additional premiums
b. the policy passes the seven-pay test
c. the policy passes the incidental benefit test
d. Table 38 rates, rather than PS 58 rates, are used to measure the employee's economic benefit