chapter 2
a straight life policy has what type of premium?
A level annual premium for the life of the insured
With respect to a Variable annuity, when is the number of annuity units determined?
At the time of the initial payout
The term "fixed" in a fixed annuity refers to all of the following but
Death benefit
Annually renewable term policies provide a level death benefit for a premium that
Increases annually
An insured has a life insurance policy that requires him to only pay premiums for a specified number of years until the policy is paid up. What kind of policy is it?
Limited-pay life
who bears all of the investment risk in a fixed annuity?
The insurance company
At the time of annunciation of a variable annuity, which of the following CANNOT fluctuate?
The number of annuity units
The main difference between immediate and deferred annuities is
When the income payments begin.
When would a 20-pay whole life policy endow?
When the insured reaches age 100
Under which of the following annuities is the exact monthly benefit not know in advance?
variable annuity
an insured purchased a life insurance policy. The agent told him that depending upon the company's investments and expense factors, the cash values could change from those shown in the policy at issue time. The policy is an
Interest-sensitive whole life.
Why is an equity indexed annuity considered to be a fixed annuity?
It has a guaranteed minimum interest rate.
which of the following is true regarding variable annuities
The annuitant assumes the risks on investment.
The equity in an equity index annuity is linked to
an index like standard and poor's 500
a party wishing to buy an annuity that will advance with economic and market conditions should buy a
variable annuity
Which of the following types of policies allows the policy owner to skip premium payments, provided that there is enough cash value in the policy to cover the premium amount?
Universal life
In a survivor-ship life policy, when does the insurer pay the death benefit?
Upon the last death
Which of the following products requires a securities license?
Variable annuity
Under a 20-pay whole life policy, in order for the policy to pay the death benefit to a beneficiary, the premiums must be paid
for 20 years or until death, whichever occurs first.
An individual has been making periodic premium payments on an annuty. The annuity income payments are scheduled to begin 2 years after the annuity was purchased. What type of annuity is it?
Defeered
which of the following is not true regarding equity indexed annuities?
They earn lower interest rates than fixed annuities.
which of the following is true for both equity indexed annuities and fixed annuities?
They have a guaranteed minimum interest rate.
all other factors being equal, the least expensive first-year premium payment is found in
Annually renewable term
which of the following is a feature of a variable annuity?
benefit payment amounts are not guaranteed.
