General Powers And Duties Flashcards
What is the primary purpose of life insurance?
To provide financial protection to beneficiaries upon the death of the insured.
True or False: Life insurance policies are only available for individuals over the age of 18.
False
Fill in the blank: The individual whose life is insured is referred to as the __________.
insured
What are the two main types of life insurance?
Term life insurance and whole life insurance.
Which type of life insurance provides coverage for a specific period?
Term life insurance.
What is a beneficiary in the context of life insurance?
A person or entity designated to receive the death benefit from a life insurance policy.
True or False: Whole life insurance policies accumulate cash value over time.
True
What is ‘underwriting’ in life insurance?
The process of evaluating the risk of insuring a person and determining the premium.
Multiple Choice: Which of the following is NOT a factor in determining life insurance premiums? A) Age B) Health C) Marital Status D) Location
C) Marital Status
What does ‘premium’ refer to in life insurance?
The amount paid periodically to keep the insurance policy active.
Fill in the blank: A life insurance policy that pays out upon the death of the insured is called a __________ policy.
death benefit
True or False: Life insurance proceeds are generally subject to income tax.
False
What is the difference between ‘term’ and ‘permanent’ life insurance?
Term life insurance provides coverage for a set period, while permanent life insurance provides lifelong coverage.
What is ‘cash value’ in a whole life insurance policy?
The savings component of a whole life policy that grows over time and can be borrowed against.
Multiple Choice: Which type of life insurance typically has higher premiums? A) Term life B) Whole life
B) Whole life
What is the ‘contestability period’ in life insurance?
A period during which an insurer can challenge a claim due to misrepresentation or fraud.
Fill in the blank: Life insurance policies often include a __________ clause that allows the policyholder to cancel the policy within a specified time frame.
free look
What is ‘riders’ in the context of life insurance?
Additional provisions that can be added to a life insurance policy to customize coverage.
True or False: Life insurance policies can be transferred to another person.
True
What is a ‘lapse’ in a life insurance policy?
The termination of a policy due to non-payment of premiums.
Multiple Choice: Which of the following is a common rider? A) Accidental Death Benefit B) Automatic Premium Loan C) Both A and B
C) Both A and B
What does ‘face amount’ refer to in a life insurance policy?
The amount of money the insurer pays to beneficiaries upon the insured’s death.
Fill in the blank: A __________ is a legal document that outlines the terms of the life insurance policy.
policy contract
What is ‘conversion privilege’ in term life insurance?
The option to convert a term policy to a permanent policy without medical underwriting.
True or False: Life insurance is only necessary for individuals with dependents.
False
What is the role of an insurance agent in life insurance?
To help clients select appropriate policies and assist with the application process.
