2 Types of Life Insurance

Universal life insurance is Select one: A. A life insurance policy that separately states the protection, savings, and expense components. B. A savings account that provides for life insurance payments from the interest on the savings. C. A type of term life insurance without cash values. D. An insurance and savings account that requires disciplined adherence to monthly payments.

A. A life insurance policy that separately states the protection, savings, and expense components. CorrectCorrect. A life insurance policy that separately states the protection, savings, and expense components.

Which one of the following is a characteristic of universal life insurance? Select one: A. The cash value of the policy will always keep the coverage in force. B. The cash value is guaranteed to earn at least a minimum interest rate. C. If the policyholder becomes unemployed, premiums will be waived. D. Policyholders are locked in to regular premium payment.

B. The cash value is guaranteed to earn at least a minimum interest rate.

The cash values in variable universal life insurance are guaranteed, as are a minimum interest rate. -True -False

-False

Current assumption whole life insurance includes features of a Select one: A. Variable universal life policy and a term policy. B. Traditional whole life policy and a first-to-die (joint) life policy. C. Traditional whole life policy and a universal life policy. D. Term policy and a traditional whole life policy.

C. Traditional whole life policy and a universal life policy.

Which one of the following statements about whole life insurance is true? Select one: A. It has an annual premium that is usually less than the premium for a comparable amount of term insurance. B. It provides protection for a fixed period of time. C. It is a form of term insurance that is convertible to universal life insurance. D. It develops a cash value that, with some limitations, is available to the insured during the life of the policy.

D. It develops a cash value that, with some limitations, is available to the insured during the life of the policy.

Term life insurance provides Select one: A. Lifetime protection that builds cash value. B. Lifetime protection that builds cash value and is usually renewable and convertible. C. Temporary protection with cash value. D. Temporary protection with no cash value and is usually renewable and convertible.

D. Temporary protection with no cash value and is usually renewable and convertible.

Flexibility is a fundamental characteristic of Select one: A. Whole life insurance. B. Term life insurance. C. Group life insurance. D. Universal life insurance.

D. Universal life insurance. CorrectCorrect. Flexibility is a fundamental characteristic of universal life insurance.

Which one of the following types of life insurance is useful to someone whose current need for life insurance will diminish after a number of years? Select one: A. Universal life B. Variable life C. Whole life D. Term life

D. Term life CorrectCorrect. Term life insurance is useful to someone whose current need for life insurance will diminish after a number of years.

All of the following are characteristics of universal life insurance, EXCEPT: -It combines life insurance protection with an investment or a savings aspect. -Three interest rates are stipulated in the policy. -The insurance protection, savings, and expense components of the policy are unbundled. -For most universal life policies, the insured's premium payments are flexible.

Three interest rates are stipulated in the policy.

Most term life insurance policies Select one: A. Are available to meet financial obligations that continue for a lifetime. B. Are not convertible. C. Carry some guarantee of renewability. D. Are hybrid combinations of life insurance and investment vehicles.

C. Carry some guarantee of renewability. CorrectCorrect. Most term life insurance policies carry some guarantee of renewability.

Term life insurance provides Select one: A. Lifetime protection that builds cash value. B. Lifetime protection that builds cash value and is usually renewable and convertible. C. Temporary protection with cash value. D. Temporary protection with no cash value and is usually renewable and convertible.

D. Temporary protection with no cash value and is usually renewable and convertible. CorrectCorrect. Temporary protection with no cash value and is usually renewable and convertible