Uses of Life Insurance Flashcards
1
Q
Based on an individual’s potential lost earnings
A
Human Life Value Approach
2
Q
Based on the family’s needs if the insured were to die prematurely
A
Human Needs Approach
3
Q
Protects a business against financial loss caused by the death or disability of a vital member of the company
A
Key Person Insurance
4
Q
Ethical duty of a producer to sell a product that provides proper coverage
A
Needs-based Selling
5
Q
The policyholder is not the insured
A
Third party ownership
6
Q
The policyholder is not the insured
A
Third party ownership
7
Q
Each partner purchases, pays the premium for, and is the beneficiary of a life insurance policy on each of the other partners.
A
Cross-purchase plan
8
Q
The partnership itself agrees to buy the deceased partner’s share of the business
A
Entity plan
