2) Term Life Insurance

Question 1

What are the three primary characteristics of term insurance

Answer 1

Limited duration, Renewal rights, and conversion privileges.

Question 2

What is Limited Duration

Answer 2

Usually, term insurance is valid for a specific number of years

Question 3

What are Renewal rights

Answer 3

This means the policy may be renewed after the INITIAL term without evidence of insurability.

Question 4

What are conversion privileges

Answer 4

The policyholders may choose to convert (change) some or all of the term insurance into permanent insurance WITHOUT evidence of insurability

Question 5

What are the types of term insurance

Answer 5

#1 Decreasing term insurance or mortgage insurance
#2 term insurance with a uniform or fixed face amount

Question 6

What is decreasing term insurance

Answer 6

The face value of the insurance (or death benefit) decreases while the premiums remain level.

The right to convert term insurance to permanent insurance applies to the remaining face amount at the conversion date.

Question 7

What is Term insurance with a uniform or fixed face amount

Answer 7

Insurance amount and premiums are fixed for the contract period, The premium increases upon each renewal (at the end of the contract period)

Question 8

Who is term insurance clientele

Answer 8

People who can see an end date for their need, young couples, business partners, people with limited finances