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Life Insurance > Policies > Flashcards

Policies Flashcards

1
Q

Attained age

A

the insured’s age at the time the policy is renewed or replaced

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2
Q

Cash value

A

a policy’s savings element or living benefit

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3
Q

Deferred

A

withheld or postponed until a specified time or event in the future

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4
Q

Endow

A

to have the cash value of a whole life policy reach the contractual face amount

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5
Q

Face amount

A

the amount of benefit stated in the life insurance policy

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6
Q

Fixed life insurance products

A

contracts that offer guaranteed minimum or fixed benefits

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7
Q

Lapse

A

policy termination due to nonpayment of premium

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8
Q

Level premium

A

the premium that does not change throughout the life of a policy

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9
Q

Nonforfeiture values

A

benefits in a life insurance policy that the policyowner cannot lose even ifthe policy is surrendered or lapses

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10
Q

Policy maturity

A

in life policies, the time when the face value is paid out

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11
Q

Securities

A

financial instruments that may trade for value (for example, stocks, bonds, options)

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12
Q

Variable

life insurance products

A

contracts in which the cash values accumulate based upon a specific portfolio of stocks without guarantees of performance

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13
Q

Has no Cash Value, and provides the greatest amount of coverage for the lowest premium

A

Term Life

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14
Q

Temporary protection because it only provides coverage for a specific period of time

A

Term Life insurance

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15
Q

_________ provides what is know as pure death protection

A

Term Life

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16
Q

3 basic types of term coverage

A

level
increasing
decreasing

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17
Q

In all types of term life coverage, the premium is

A

Level

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18
Q

Upon selling, renewing , or converting a term policy, the premium is figured at the ____

A

Attained Age

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19
Q

Level term insurance

A

death benefit does not change

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20
Q

Level Premium term

A

level death benefit and level premium

21
Q

Term life with a level premium and a decreasing death benefit each year

A

Decreasing Term

22
Q

renewable provision

A

allows policyowner the right to renew coverage at the expiration date without evidence of insurability

23
Q

Convertable provision

A

provides the right to convert the policy to a permanent policy without the evidence of insurability.

24
Q

______________ is a general term used to refer to various forms of lifeinsurance policies that build cash value and remain in effect for the entire life ofthe insured (or until age 100) as long as the premium is paid

A

Permanent

life insurance

25
Q

The most commontype of permanent insurance is

A

Whole Life

26
Q

Build cash value (living benefits)

A

Whole life policies

27
Q

Can you borrow against cash value in a whole life policy

A

yes

28
Q 
Key charateristics of \_\_\_\_\_\_\_\_\_\_\_\_\_\_ are
Level premium
Level Death benefit
cash value
living benefits
A

Whole life insurance

29
Q

___________ does not usually accumulate until the third policy year

A

cash value

30
Q

The 3 basic forms of whole life insurance are

A

straight whole life
limited-pay
single premium

31
Q

__________ premiums for coverage will be completely paid-up well before age 100

A

limited - pay whole life

32
Q

The policy is completelypaid-up after one premium and generates immediate cash.

A

Single premium whole life (SPWL)

33
Q

allow the policyowner to pay more or less than the planned premium

A

Flexible premium

34
Q

provide the policyowner with thebest of both worlds (term and permanent coverage).
canassume the form of either term insurance or permanent insurance

A

Adjustable life

35
Q

With an adjustable life policy the policy owner can

A

Increase or decrease the premium or the premium-paying period;

Increase or decrease the face amount;
or
Change the period of protection

converting
from term to whole life or vice versa

36
Q

With an adjustable life policy you will need ______________ to increase death benefit or lower premium

A

proof of insurability

37
Q

__________________ insurance is also known by the generic name of
flexible premium adjustable life
. That implies that the policy owner has the flexibility to increase the amount of premium paid into the policy and to later decrease it again

A

Universal life

38
Q

flexible premium
interest-sensitive
has a contract interest rate

A

Universal life

39
Q

Universal life has 2 components

A

Insurance - always annually renewable term insurance

Cash account

40
Q

provides the policy owner with flexible premiums and an adjustable death benefit

the policy owner rather than the insurer decides where the net premiums (cash value) will be invested

the cash values are not guaranteed, and the death benefit is not fixed
The cash value and/or death benefit may increase or decrease over the life of the policy depending on the investment performance of the underlying sub-account

A

Variable universal life

41
Q

a single policy that is designed to insure two or more lives
can be in the form of term insurance or permanent insurance

Premium would be less than for 2 individuals
The death benefit is paid upon the
first death only

A

Joint Life

42
Q

pays on thelast death

rather than upon the first death

A

Survivorship life

43
Q

any life insurance written on the lifeof a minor

A

Juvenile Life

44
Q

Group life insurance is usually written as___insurance

A

It is usually written as
annually renewable term
insurance

45
Q

two distinguishing features of group life insurance are

A

Evidence of insurability is usually not required (unless an applicant is enrolling forcoverage outside the normal enrollment period)

Participants (insureds) under the plan do not receive a policy because they donot own or control the policy

46
Q

each insured participant under the group plan is issued a

A

certificate ofinsurance

47
Q

The actual policy, or
masterpolicy/contract
, is issued to

A

the sponsor of the group, which is often an employer

48
Q

Group life insurance cost are based on

A

the average age of the group and the ratio of men to women

49
Q

special type of coverage written to insure the life of thedebtor and pay off the balance of a loan in the event of the death of the debtor
usually written as
decreasing term insurance
may be written asan individual policy or as a group plan

A

Credit

insurance

Life Insurance (5 decks)

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