Ch Exam Types Of Insurance Policies Flashcards
A life insurance policy that has premiums fully paid up within a state it time period is called?
Limited payment insurance
All of these statements concerning whole life insurance arefalse except?
When a whole life policy is surrendered income tax may be owed
Which of the following other premium payments for a universal life policy not used for?
Separate account investments
Joe has a insurance policy that has a face value of $300,000. At the end number of years, the policy cash value accumulate to $50,000 and the face amount becomes $350,000. What kind of policy is this?
Universal life policy
Krista purchase a 10 year level term life insurance policy that has a death benefit of 200 K. Which of these statements is true?
The premium and the face amount will remain constant for the ten-year period
Which of these would be the best example of a limited paid life insurance policy?
Whole life policy with premiums paid up after 20 years
Which of the following type of life insurance is normally associated with a mortgage loan?
Decreasing term
Tom is shopping for a policy that covers two people and would pay the face amount only when the first person dies. The type of life policy he is looking for is called a ?
Joint life policy
Which of the following statements do not apply to child Coverage in a family policy?
Only children born prior to policy issue dates may be included
What is the automatic continuance of insurance covers referred to as?
Renewal
Under a modified endowment contract, what are the likely tax consequences?
Predeath distributions will become taxable
In a modified endowment contract, the penalty tax imposed on premature withdrawal is
10%
Judy has a $100,000.30 year mortgage on her home. What type of life insurance could she purchase that is designed to pay off the loan balance if she dies within the 30 year period?
Decreasing term insurance
Predeath distributions for a modified endowment contract receivers different tax treatment than other life insurance policies because
The modified endowment contract tend to be an investment vehicle
Which of the following policies does not build cash value?
Term
Insurance policy with the insured can choose where to cash value can be invested is called?
Variable life
Donald is the primary insured on a life insurance policy and as a Children term rider. What is the advantage of adding this rider?
Can be converted to permanent coverage without evidence of insurability
A partial surrender is allowed in which of the following life policies
Universal life
Which of the following is not a true description of non-medical life insurance
Applicants are not required to answer medical questions on the application.
The type of policy which pays on the death of the last person is called
Survivorship life
How are survivorship life insurance policies helpful in estate planning?
Provides funds to help pay taxes
Which type of policy combines the flexibility of a universal life policy with investment choices?
Variable Universal life policy
The statement which best describes the relationship between a premium of a whole life policy and the Premiumpayment period is
The short of the payment., The higher premium
John and Mary has a handicap child that is financially dependent upon them. The death of one of the parents would not be financially disastrous, however the death of both like we would be. What policy best suited for them
Second to die policy
When is decreasing term policy is purchase, it contains a decreasing death benefit and
Level premium
Mark, age 45, has a modified endowment contract. What is the tax penalty for taking a loan against his policy prior to age 59 1/2?
10%
Which of these riders will pay a death benefit if the insured spouse die?
Family term insurance rider
A spouse and child can be added to a primary insurance coverage as what kind of rider?
Family term
Which type of multiple protection policy pays on the death of the last person?
Survivorship life policy
All of these are valid options for an adjustable life policy except
A nonforfeiture option can be used to increase the death benefit
A securities license is required for a life insurance producer to sell?
Variable life insurance
The least expensive Option to pay off a 30 year mortgage balance would be?
Decreasing term life
What kind of life insurance policy covers two or more people with the death benefit payable upon the last person’s death?
Last survivor life insurance
A life insurance policy that pays the face amount if the insurance advised to a specific period of time is called
Endowment insurance
A life insurance policy that is a subject to a contract interest rate is referred to as
Universal life
Variable life insurance and universal life insurance are very similar. Which of these features are hell exclusively by Variable universal life insurance?
Policy owner has the right to select a investment which will provide the greatest return
Term insurance is approximate for someone who’s
Seats temporary protection and lower premiums
A policy owner may change to policy features on what type of life insurance
Adjustable life
All of these are characteristics of a universal life insurance policy except
Fixed surrender value
Sean, Mike, and Dave are brothers who have a $100,000 first to die joint life policy cover in all three of their lives. If Mike dies first the policy proceeds
Will no longer provide insurance protection
A business will typically use which type of life insurance to cover their employees?
Group policy
A limited payment whole life policy provides
Life protection
Index whole life insurance contains a security component that acts as
Hedge against inflation
Insurance policy which contains cash values that very accordingly to is investment performance of stocked is called
Variable whole life
Peter has a policy where 80% to 90% of the premium is invested in traditional fix income securities and remainder of the premium is a visit in a contractor to a stipulated stock index. What kind of policy is this?
Equity indexed whole life
An insurance policy written out the 1988 that feels to pass to seven pay test is known as
A modified endowment contract
What happens to the coverage on a Children term rider when the child reaches a certain specific age?
Courage is Eliminated
A life insurance policy that contains a guarantees interest rate with a chance to earn a rate that is higher than the guarantee rate is called?
Universal life
A permanent life insurance policy where the policy owner pays premiums for a specific number of years is called
Limited pay policy
What is the proper order for additional life insurance premium, from lowest to highest?
Modified premium, ordinary life, single premium
The premium for a modified whole life policy is
Lower than the typical whole life policy doing the first few years and then higher than typical for the remainder
What does the word “level”level term describes
The face amount
Which of the following is a life insurance policy that does not require a physical examination?
Non-medical

Which type of life insurance policy pays the face I’m out at the end of the specific If the insured is still alive
Endowment policy
What is a corridor in relation to a universal life insurance policy?
The gap between the total death benefit and the policy cash value
Which of these describes a result of a modified endowment contract that fails to meet the seven pay test
Predeath distributions are typically taxable
What type of life insurance are normally use for key employees Indemnification
Term, whole, and universal life insurance
Jonas is a whole life insurance policy owner and would like to add coverage for his two children. Which of the following products will allow him to Accomplish of this?
Child term writer
Which type of life insurance offers flexible premiums, A flexible death benefit, and the choice of how the cash value will be invested?
Variable universal policy
Which of the following is not true regarding a family policy that covers children?
Conversion of Charles coverage to permanent insurance requires evidence of insurability
Shirley has a $500,000.10 year nonrenewable level term life policy. If she does 15 years as a policy inception date, how much will her beneficiary receive?
Nothing
The type of multiple protection coverage that pays on the death of the last person that called
Survivorship life policy
A single premium cash value policy can be described as
A policy that is paid up after only one payment
Raw purchase a standard whole life policy with a $500,000 death benefit when he was age 30. His insurance agent told him the policy would be paid up if he reached age 100. The present cash value of the policy equal $250,000. Robert recently died at age 60. The death benefit would be
$500,000
Lynne owns a life policy that guarantees the right to renew the policy each year, regardless of health, but at an increase premium. What kind of policy is this?
Renewable term
An interest sensitive life insurance policy owner may be able to withdraw the policy cash value interest free. The provision that allows this is called
Partial surrender
A renewable term life insurance policy allows the policy owner of the right to renew the policy
Without producing proof of insurability
A modified endowment contract is best described as
A life insurance contract that accumulate cash value higher than the IRS will allow
Which type of life insurance is normally associated with a payor benefit rider
Juvenile insurance
A life insurance policy limits of liability will be
The policy face amount
A life insurance policy written on one contract for two people in which it is payable upon the first death is called
Joint
Which of the following types of life insurance combines a savings element along with a flexible premium option?
Universal life
Any renewable term life insurance policy, the contract will usually
Require a higher premium payable at each renewal
Scott has just purchased a new house. He is now shopping for a life insurance policy that provides the death benefit that message to projected outstanding debt of his mortgage. What life policy would best suit his knees?
Mortgage redemption
A renewable term life insurance policy can be renewed
Add a predetermined date or age, regardless of the insured health 
Level premium permanent insurance accumulates a reserve that will eventually
Equal the face amount of the policy
Decreasing term life insurance is often used to
Provide coverage for a home mortgage
Which of these is not subject to income tax on the modified endowment contract
Death benefit
Reggie purchase a life insurance policy with a face value of $500,000. I have a 15 year, the cash that you had accumulated to $100,000 and the policy face amount has become $600,000. Which type of life insurance policy is this?
Universal life
Which policy feature makes a universal life policy different from a whole life policy?
A flexible premium schedule
A modified endowment contract is best described as
A life insurance contract which accumulate cash value is higher than the IRS will allow
