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Primerica: Online Pre-Licensing > Life Insurance Policies > Flashcards

Life Insurance Policies Flashcards

1
Q

renewable without a physical examination, up to a certain age.

A

Term insurance

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2
Q

may be converted to whole life, but not the reverse. Conversion is based on the
insured’s current age.

A

Term insurance

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3
Q

convertible based upon the current or attained age of the insured.

A

Convertible term

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4
Q

the re-entry option is contingent upon the insured passing a physical
exam.

A

Term insurance

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5
Q

the premium and the amount of coverage are level throughout the term.

A

Level Term

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6
Q

the premium will increase every year, although the

face amount will remain the same.

A

Annual Renewable Term (ART)

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7
Q

The face amount of a mortgage protection life insurance policy will decrease at the same rate as
the mortgage balance declines.

A

Term insurance

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8
Q

T/F

It is the face amount that decreases on a decreasing term policy, not the premium.

A

True

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9
Q

type of life insurance provided in mortgage redemption insurance.

A

Decreasing term

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10
Q

must contain a table showing their guaranteed cash value at the end of each
year (anniversary date) for the first 20 years. It is shown per unit (per thousand).

A

Whole life

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11
Q

benefits are bundled (packaged).

A

Whole life

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12
Q

benefits are transparent (stand-alone).

A

universal life

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13
Q

reach maturity at the same time (age 100).

A

Whole life and limited pay

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14
Q

premiums are due until the insured dies or reaches age 100.

A

Whole life

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15
Q

premiums are paid for a shorter period of time.

A

limited pay

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16
Q

has a level premium and will provide coverage until the insured
dies or reaches age 100.

A

Straight or whole life

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17
Q

pay the face amount upon death or age 100, whichever comes first.

A

Whole life

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18
Q

though paid up earlier, do not mature until the insured reaches
age 100.

A

Limited pay whole life

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19
Q

T/F

Limited pay whole life insurance has limits that pertain either to the number of years payments
must be made, such as 20 pay-life, or the age by which all premiums must be paid, such as life
paid-up at 65.

A

True

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20
Q

the cash value will equal the face amount at maturity.

A

20-pay whole life

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21
Q

T/F

A single premium may buy a policy that is paid up for life.

A

True

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22
Q

T/F

A single premium policy has an immediate cash value.

A

True

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23
Q

This may be suitable for someone with fluctuating income

A

Adjustable whole life

24
Q

T/F

Adjusting the premium paid on an adjustable whole life policy will affect the face amount, and
vice versa.

A

True

25
Q

different from whole life because it has a premium that is flexible.

A

Universal life insurance

26
Q

These policies permit their owners to take partial surrenders.

A

Universal life insurance

27
Q

T/F

Taking a partial surrender on a universal life policy allows the policyowner to withdraw some of
the cash value without paying tax on the interest.

A

True

28
Q

This type of insurance is also known as interest sensitive whole life.

A

Universal life insurance

29
Q

a combination of 1-year renewable term and a cash value account.

A

Universal life insurance

30
Q

offers flexible premiums and a minimum guaranteed rate of return.

A

Universal life insurance

31
Q

Loans are allowed on these kinds of policies

A

Universal life

32
Q

allows the insured to self-direct the cash value investment.

A

Variable life

33
Q

have no guarantees and are not backed by the guaranty fund.

A

Variable policies

34
Q

T/F

Investing in variable products isn’t considered a hedge against inflation.

A

False, it is considered a hedge against inflation.

35
Q

A universal life policy that has an investment component is called…

A

variable universal life.

36
Q

A life insurance policy that invests its cash values in equities is known as…

A

variable life.

37
Q

A life insurance policy that has a flexible premium and allows the policyowner to self-direct their
cash values into equities is known as…

A

variable/universal life

38
Q

T/F

An agent must be registered with FINRA in order to sell a variable product.

A

True

39
Q

pays only when the first insured dies.

A

joint life policy

40
Q

pays only

when the second insured dies.

A

joint and survivor life policy

41
Q

commonly used in estate planning so the death benefit of the

policy can be used to pay estate taxes when due.

A

Survivorship life insurance

42
Q

pays when the surviving insured dies.

A

Survivorship life insurance

43
Q

a life insurance policy written on the life of a minor.

A

A juvenile life insurance policy

44
Q

T/F

On credit life, the creditor is both the policyholder and the beneficiary.

A

True

45
Q

The type of policy used to provide credit life insurance

A

decreasing term.

46
Q

T/F

The policy limits on credit life cannot exceed the amount of the loan.

A

True

47
Q

the employees receive a certificate of insurance that summarizes
coverage and lists the employee’s beneficiary.

A

Group life insurance

48
Q

the policyowner, who is usually an employer, is issued the master policy.

A

Group insurance

49
Q

75% eligible employees must enroll.

A

contributory group life insurance policy,

50
Q

100% of all eligible

employees must participate.

A

noncontributory group life plan (employer pays total premium)

51
Q

T/F

Individual policies are usually more expensive than group.

A

True

52
Q

the employer may require an employee to pay the premium for dependent’s
coverage.

A

Group life

53
Q

T/F

Group insurance participation requirements don’t help to avoid adverse selection.

A

False: they do help

54
Q

T/F

A group cannot be formed just to buy insurance.

A

True

55
Q

T/F

Experience rating is for large groups only. Rates are based on claims experience of the group.

A

True

Primerica: Online Pre-Licensing (4 decks)

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