Business insurance – Lesson 9

Question 0

What type of plan involves a sharing of premiums, ownership rights, and death proceeds between an employer and an employee?

Answer 0

Split Dollar

Question 1

In a partnership cross purchase agreement, the life policies on the partners are owned by the partnership. True or false?

Answer 1

False

Question 2

Key person insurance:

Answer 2

Protects the company for which the key employee works.

Question 3

What is not used to buy out a deceased business partner’s interest?

Answer 3

Split dollar insurance

Question 4

What forms of insurance products might be used to fund a deferred compensation plan?

Answer 4

1. Life insurance
2. Disability income
3. An annuity

Question 5

Life insurance is a useful tool in business. What are some of the uses of life insurance?

Answer 5

1. A funding method
2. Business interruption insurance (key employee).
3. An employee benefit

Question 6

What are the three ways businesses are organized?

Answer 6

1. Sole proprietorships
2. Partnerships
3. Corporations

Question 7

What are the two types of partnership insured buy sell agreements?

Answer 7

1. Cross purchase plan

2. Entity purchase plan

Question 8

In a partnership, what is used more frequently when there are a number of partners?

Answer 8

Entity purchase plan

Question 9

In a Deferred Compensation plan, should the employee choose to leave the employment prior to retirement, the deferred compensation will be forfeited. True or false?

Answer 9

True