Life Insurance Flashcards
issues very small face amounts, such as $1,000 or $2,000. Premiums are paid weekly and collected by debit agents. They were designed for burial coverage.
Industrial
is life insurance of commercial companies not issued on the weekly premium basis. It is made up of several types of individual life insurance, such as temporary (term), permanent (whole).
Ordinary
is insurance written for members, such as a place of employment, association, or a union. Coverage is provided to the members of that group under one master contract. The group is underwritten as a whole, not on each individual member. One of the benefits of group life coverage is usually there is no evidence of insurability required.
Group
Which of the following Life insurance policies combine term insurance with an investment element?
Universal Life
J is issued a Life insurance policy with a death benefit of $100,000. She pays $600 per year in premium for the first 5 years. The premium then increases to $900 per year in the sixth year and remains level thereafter. The policy’s death benefit also remains at $100,000. Which type of life insurance policy is this?
Modified Premium Life
K is looking to purchase Renewable Term Insurance. Which type of Term insurance may be renewable?
Level
Which of the following actions is NOT possible with a Universal Life Policy?
Premiums may be applied as a credit against income tax.
K purchased a Life insurance policy in 1986 which paid 10% interest in the early years of the policy. Twenty years after the purchase, she received a notice from the insurer stating that the policy will soon terminate unless a much-higher premium is paid because of falling interest rates. This type of policy is known as a _______ life policy.
Universal
Limited Pay Life Policy is a
Life Paid Up at age 70
Exceeds the maximum amount of premium that can be paid into a policy and still have it recognized as a life insurance contract.
MEC - Modified Endowment Contract
A term life policy matures upon
insured’s death during the term of the policy
At what point does a Whole Life insurance policy endow?
When the cash value equals the death benefit.
What kind of insurance policy supplies an income stream over a set period of time that starts when the insured dies?
Family maintenance policy
T would like to be assured $10,000 is available in 10 years to replace a roof on his house. What kind of $10,000 policy should T purchase?
Ten Year Endowment
