Retirement And Other Insurance Options Flashcards
According to the taxation rules of life insurance policies, how are cash value increases taxed?
Cash value growth is tax deferred
If a retirement plan is qualified, what does that mean?
The plan has favorable tax treatment
Life insurance may be used to pay state inheritance taxes and federal estate taxes elimination the need to sell assets from the estate. What is this called?
Estate conservation
Group life policies are written as what time of insurance?
Annually renewable term
What is required to qualify an individual to contribute to a traditional IRA?
Earned income
What are the most common tires of business life insurance?
Key person
Buy-sell agreements
Executive bonuses arrangement
What is the main advantage of converting from group life insurance to individual coverage?
Evidence of insurability is not required
What are the person uses of life insurance?
Survivor protection
Estate creation & conservation
Cash accumulation
Liquidity
What are the characteristics of the group that underwriters well consider before issuing a policy?
Groups purpose
Size
Financial strength
Turnover
What are some examples of qualified plans?
IRA
401(k)
HR10 (keogh)
SEP
SIMPLE
When planning for survivor protection in life insurance, what needs to be considered?
The insured current assets, liabilities and survivors needs.
Upon surrender of a life insurance policy, what portion of the cash value will be taxed?
Only the portion in excess of the paid premium
What is the penalty for excessive contributions to a traditional IRA?
6%
If an insured terminates membership in a group life insurance, to what you’re off insurance can the insured cover the coverage?
Whole life
