Types of life insurance policies
which of the following is incorrect regarding a $100,000 20-year level term policy?
at the end of 20 years, the policy's cash value will equal $100,000
in a survivorship life policy, when does the insurer pay the death benefit?
upon the last death
when would a 20-pay whole life policy endow?
when the insured reaches 100
which of the following is true regarding the premium in term policies?
the premium is level
a straight life policy has what type of premium?
a level annual premium
what does "level" refer to in level term insurance?
face amount
all of the following are true about variable products except
the premiums are invested in the insurer's general account
the term "fixed" in a fixed annuity refers to all of the following except
death benefit
an annuity owner is funding an annuity that will supplement her retirement. because she does not know what effect inflation may have on her retirement dollars, she would like a return that will equal the performance of the standard and poor's 500 index. she would likely purchase a(an)
equity indexed annuity
under a 20-pay whole life policy to pay the death benefit to a beneficiary, the premiums must be paid
for 20 years or until death, which ever comes first
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
all other factors being equal, which of the following terms best describe the coverage provided by term policies, as compared to any other form of protection?
greatest
during partial withdrawal from a universal life policy, which portion will be taxed?
interest
which of the following best describes annually renewable term insurance?
it is level term insurance
an insured buys a 5-year level premium term policy with a face amount of $10,000. the policy also contains reliability 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 option for universal life allows the beneficiary to collect both the death benefit ad cash value upon the death of the insured?
option b
which of the following is NOT one of the three basic types of coverage that are available, based on how the face amount changes during the policy term?
renewable
which of the following policies would be classified as a traditional level premium contract?
straight life
which of the following would help prevent a universal life policy from lapsing?
target preimium
all of the following are true regarding the convertibility option under a term life insurance policy except
upon conversion the death benefit of the permanent policy will be reduced by 50%
which of the following types of insurance policies would provide the greatest amount of protection for a temporary period during which an insured will have limited financial resources?
term
all of the following entities regulate variable life policies except
the guaranty association
what is the purpose of establishing the target premium for a universal life policy?
to keep the policy in force
an insured owns a life insurance policy. to be able to pay some of her medical bills, she withdraws a portion of the policy's cash value. there is a limit for a withdrawal and the insurer charges a fee. what type of policy does the insured most likely have?
universal life
a policy will pay the death benefit if the insured died during the 20-year premium-paying period, and nothing if the death occurs after the 20-year period. what type of policy is this?
level term
which of the following is an example of a limited-pay life policy?
life paid-up at age 65
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 insurance
which of the following is called a "second-to-die" policy?
survivorship life
which type of life insurance policy allows the policy owner to pay more or less than the planned premium?
universal life
an insurance policy that only requires a payment of premium at its inception, provides insurance protection for the life of the insured, and matures at the insured age 100 is called
single premium whole life
all of the following are true regarding a decreasing term policy except
the payable premium amount steadily declines throughout the duration of the contract
annually renewable term policies provide a level death benefit for a premium that
increases annually
variable life insurance is based on what kind of premium?
level fixed
a man decided to purchase a $100,000 annually renewable term life policy to prove additional protection until his children finished college. he discovered that his policy
required a premium increase each renewal.
which of the following is not true regarding the accumulation period of an annuity?
it would not occur in a deferred annuity
the death protection component of universal life insurance is always
annually renewable term