chapter 3

A Universal Life Insurance policy is est described as a/an

Annually Renewable Term policy with a cash value account

in increasing and decreasing term policies, which policy component fluctuates during the policy term

Death benefit

In which of the following cases will the insured be able to receive the full face amount from a whole life policy

If the insured lives to age 100

Which option for Universal life allows the beneficiary to collect both the death benefit and cash value upon the death of the insured

Option B

A group of 15 skydivers met at a seminar and began talking about life insurance during a break. Because it was expensive to get individual life insurance, they decided to band together to form a small group so that they could qualify for group life insurance. After they applied for group life insurance, they were rejected. Why?

The purpose of the group was to purchase life insurance

Which of the following Life Insurance policies would be considered interest sensitive

Universal Life

what characteristic makes whole life permanent protection

coverage until death or age 100

An insured buys a 5-year level premium term policy with a face amount of 10,000. The policy also contains renewability and convertibility options. When the insured renews the policy in 5 years, what will happen to the premium

it will increase because the insured will be 5 years older than when the policy was originally purchased

Which statement is not true regarding a straight life policy

its premium steadily decreases over time, in response to its growing cash value

an employee is joining a group insurance plan. In order to avoid having to prove insurability, what must the employee do?

join during the open enrollment period

Variable Whole Life insurance is based on what type of premium

level fixed

A policy will pay the death benefit if the insured dies during the 20-year premium-paying period, and nothing if death occurs after the 20-year period, What type of policy is this?

level term

In ter pllicies, what happens to the premium throughout the term of the policy?

premium always remains level

the follwoing are features of the indexed universal life except

sale of this product requires a securities license

Which of the following tatements about group life is correct

the cost of coverage is based on the ratio of men and women in the group

An employee is insured under her employer's group life plan. If she terminates her group coverage, which of the following statements is incorrect

the insured may choose to convert to term or permanent individual coverage

which of the following determines the cash value of a variable life policy

the performance of the policy portfolio