Life Insurance policies

Question 1

What are living benefits of whole life insurance?

Answer 1

Loan value

Question 2

In what type of life insurance policies can the policy owner skip premium payment with out the policy lapsing?

Answer 2

Universal life

Question 3

When does an adjustable life insurance policy accumulate cash value?

Answer 3

When the premiums paid are more than the cost of the policy

Question 4

What is the purpose of establishing the target premium for insurance?

Answer 4

To prevent the policy from lapsing

Question 5

What type of life insurance policy provides permanent protection?

Answer 5

Whole life

Question 6

What type of life insurance policy is Life Paid-up at age 65?

Answer 6

Limited paid whole life

Question 7

What type of policy is typically issued without proof of insurability from the insured?

Answer 7

Group policy

Question 8

In variable universal life insurance, to what policy components does the term variable refer ?

Answer 8

Cash value and death benefit

Question 9

Under a 20-pay whole life policy, in order for the policy to pay the death benefits to a beneficiary, the premium must be paid for what time period?

Answer 9

For 20 years or until the insured’s death whichever comes first

Question 10

When would a 20-pay whole life policy endow?

Answer 10

When the insurer reach the age of 100

Question 11

What are the characteristics of the group that underwriters will consider before issues a group policy?

Answer 11

Groups Purpose, size, financial strength and turnover

Question 12

What universal life option has a gradually increasing cash value and a level death benefit?

Answer 12

Option A

Question 13

What type of insurance is best suited to cover a mortgage?

Answer 13

Decreasing term

Question 14

What are the death benefit options in universal life policies?

Answer 14

Option A- level death benefits, and Option-B-increasing death benefits

Question 15

An individual just burrowed $10,000 on a 5 year note from the bank. The note odd due in installments. What type of life insurance policy would be best suited to this situation?

Answer 15

Decreasing term

Question 16

Who is entitled to the cash values in a life insurance policy?

Answer 16

The policy owner

Question 17

Between adjustable live and universal life policies, which one provides more flexibility to the policy owner ?

Answer 17

Universal life

Question 18

Whole life insurance policies mature when the insured reaches age 100. Of the owner of whole life policy (the insured) does at 80, and there are no outstanding loans on the policy, what portion of the death benefit will be paid to the beneficiary.

Answer 18

The full death benefit

Question 19

The death protection component of a universal life policy is expressed as what type of coverage?

Answer 19

Annually renewable term

Question 20

Universal life policies have two types of interest rates. What are they?

Answer 20

Guaranteed and current

Question 21

In term policies, what happens to the premium throughout the term of the policy?

Answer 21

It’s fixed (remains level)

Question 22

What happens to the cash value when a whole life policy matures?

Answer 22

Cash value is paid to the policy owner

Question 23

A whole life policy that requires that the policy owner only pays premiums for a specific number of years is known as what kind of policy?

Answer 23

Limited-paid whole life

Question 24

What type of policy issues certificates of insurance to the insureds?

Answer 24

Group policy

Question 25

Even the amount of insurance is increased in an adjustable life policy, what will the insurer require from the insured?

Answer 25

Evidence of insurability

Question 26

What happens to the premium in an annually renewable term life policy?

Answer 26

The premium increased with each renewal

Question 27

A policy states it will pay a specified face value amount of the insured does during the 20 years premium- paying period and nothing of death occurs after the 20 years period. What type of policy is this?

Answer 27

20 year level term

Question 28

While life policies provide protection until the insured reaches what age?

Answer 28

Age 100

Question 29

Under Option-B in universal life insurance policy, what happens to the death benefits?

Answer 29

The death benefits increase each year by the amount of the cash value increases

Question 30

What is the main advantage of converting from group life insurance to individual coverage?

Answer 30

Evidence of instability is not required

Question 31

What is the major difference between the most common types of whole life policies: straight life, limited payments and single premium?

Answer 31

Premium payment mode

Question 32

What type of whole life policy generate immediate cash value?

Answer 32

Single premium whole life

Question 33

What does level refer to in level term insurance?

Answer 33

Face amount

Question 34

How is the premium determined in a joint life insurance policy?

Answer 34

The premiums are based on the average age of the insureds

Question 35

Who is insured under a juvenile life policy?

Answer 35

A minor

Question 36

What elements of an adjustable life policy can be changed by the policy owner?

Answer 36

The amount and payment period of premium, the face amount, and the period for protection

Question 37

Group life insurance policies are written as what type of insurance?

Answer 37

Annually renewable term

Question 38

The policy owner of a whole life insurance policy is also the insured. What age must the insured stain in order to recover the policy’s face value amount?

Answer 38

Age 100

Question 39

If an employee wants to join a group life insurance coverage outside of the open enrollment period, what would the employee have to provide?

Answer 39

Evidence of insurability

Question 40

Who owns a group life insurance contract?

Answer 40

The employer (aka- the sponsor of the group).

Question 41

What policy component Missy decrease in decreasing term insurance?

Answer 41

Face amount

Question 42

Why are policy loans not available on teen insurance?

Answer 42

There are no cash values to borrow against

Question 43

An insured received a monthly summary for his life insurance policy. He notices that the cash value of the policy is significantly lower this month than it was last month. What type of policy doors the insured have?

Answer 43

Variable

Question 44

What type of premium is charged on a straight life policy?

Answer 44

A level premium for the life of the insured

Question 45

What type of whole life insurance policy only requires a payment of premium at its inception, and in addition to providing insurance protection for the life of the insured, endows at the insured’s age 100?

Answer 45

Single premium whole life

Question 46

In annually renewable term policies, what is the annual premium based upon?

Answer 46

The insured’s attained age

Question 47

In a joint life policy, when is the death benefit paid?

Answer 47

Upon the first death

Question 48

If an insured terminates membership group life insurance, to what type of insurance can the insured convert the coverage ?

Answer 48

Whole life

Question 49

What type of policy offers pure death protection?

Answer 49

Term

Question 50

Regarding taxation, how does the cash value of universal life policy accumulate?

Answer 50

Tax deferred

Question 52

Variable whole life insurance is based on what type of premium?

Answer 52

Level fixed

Question 53

Which of the following are not allowed in credit life insurance?

Answer 53

Creditors requiring that a debtor buy insurance from a certain insurer.

Question 54

All of the following could own group life insurance except?

Answer 54

A group needing low-cost life insurance.

Question 55

Annually renewable term policies provide a level death benefit for a premium that.

Answer 55

Increases annually

Question 56

Which of the following policies would have an IRS require corridor or gap between the cash value and the death benefits?

Answer 56

Universal life- Option-A

Question 57

Which of the following best describes annually renewable term insurance?

Answer 57

It is level term insurance

Question 58

All of the following are true about variable products EXCEPT?

Answer 58

The premiums are invested in the insurer’s general account